Our Arctic Neighbors: Russia cuts taxes for Arctic exploration

Russia’s State Duma approved tax cuts in early July for oil producers to encourage exploration and development, particularly for those working in Arctic regions. The new legislation creates exemptions from the mineral extraction tax for oil fields that are no more than 0.05 percent depleted. In the offshore Arctic, tax holidays would last 10 to 15 years or until total output reaches 35 million tons of oil (255.5 million barrels). Tax holidays for onshore fields in the Timan Pechora and Yamal Peninsula regions would last seven to 12 years or until total output reaches 15 million tons (109.5 million barrels).

Russian oil production has been falling this year, in contrast to previous years, when it rose steeply.