Tax incentives as the tool for stimulating hard to recover oil reserves development

I V Sharf,D N Borzenkova,L S Grinkevich

doi:10.1088/1755-1315/27/1/012079

Abstract

The share of hard-to-recover oil reserves, principally from unconventional hydrocarbon sources, has significantly increased in the world petroleum market. Russian policy of subsurface management is directed to stimulate the development, survey and involvement into production of hard-to-recover oil reserves by tax-financial and economic-organizational tools among which tax incentives is the most effective one. The article highlights different categories of hard-to-recover oil reserves as a basis for generating tax incentives. Also the aspects of tax influence on petroleum business (involved in production of had to recover reserves) in Tomsk region are revealed, both positive and negative.

Highlights

The issue concerning hard-to-recover oil reserves is becoming extremely relevant in rapidly changing macroeconomic conditions
State Register of Mineral Reserves estimates 2885 deposits with oil reserves; more than a half of recovered reserves are buried in 11 unique deposits and in 85 large deposits (60-300 mln.t.); among them 9 unique and 56 large deposits are situated in West Siberian petroleum basin
Long-term and risky investments for production and development of HC from conventional reserves are becoming less attractive. This reflects on the financial possibilities of petroleum enterprises and principally on Russian enterprises

Summary

Introduction

The issue concerning hard-to-recover oil reserves is becoming extremely relevant in rapidly changing macroeconomic conditions. 2) change of energy producing and energy consuming structure due to the increase in alternative energy sources significance and production of hydrocarbons (HC) from unconventional reserves [2,3]. This fact influences strongly the strategy of financial trading organizations. Long-term and risky investments for production and development of HC from conventional reserves are becoming less attractive. This reflects on the financial possibilities of petroleum enterprises and principally on Russian enterprises.

Published under licence by IOP Publishing Ltd

Hard to recover

Findings

Conclusion