MinFin proposes extending tax break for Yamal LNG in exchange for investment agreement

MOSCOW. Sept 25 (Interfax) - Russia's Finance Ministry has proposed to link the application of a zero mineral extraction tax (MET) rate for gas production at fields located completely or partially on the Yamal and Gydan peninsulas that is used to produce liquefied natural gas (LNG), ammonia or hydrogen to the signing of an investment agreement, a source familiar with draft amendments to the Tax Code told Interfax.

In order to get the tax break, the resource developer will have to sign an investment agreement on financing Kamchatka Territory obligations arising from the implementation of measures to build facilities for an LNG regasification complex in the eastern Russian region, as well as development of projects to produce LNG, ammonia or hydrogen. The bill does not specify the location for such projects.