Astana, Kazakhstan, Sept.22
By Daniyar Mukhtarov - Trend:
Kazakhstan's Association of Oil, Gas and Energy Sector Organizations (KazEnergy) proposes to resume the issuance of combined contracts for the exploration and production in order to stimulate the inflow of investments in the oil and gas sector, Director General of KazEnergy Asset Magauov said.
He made the remarks while presenting the National Energy Report for 2013.
"We intend to put forward proposals on attracting investments in the oil and gas sector. We are working on amendments to a number of draft laws, to be more precisely, to the Code on Subsoil, as we are aware that currently, a small volume of investments in made in the geological exploration," Magauov said.
The aim is to firstly resume the issuance of contracts on exploration and production, as the investors which make considerable amount of investments in the geological exploration currently have no guarantee that a contract on production will be signed.
Additionally, the association intends to raise the issue of reducing the tax burden of oil producing companies.
"The tax burden of the oil and gas sector is as huge as 70-80 percent. However, taking into account that our fields are deep and have a high content of hydrogen sulphide, we intend to advocate for tax relief under the law 'On Subsoil'," Magauov said.
The director general of KazEnergy said that the optimal tax burden should be equal to 60 percent.
Additionally, the association intends to propose the strict differentiation of environmental and administrative fines in order to avoid double liability.
"We have involved an international consultant in order to put forward proposals on the amendments to the current legislation. Currently, the Code on Subsoil is under discussion. It consists of two parts: solid minerals and oil. The Mining Industry Association is working on the amendments to the first part and we are working on the second part," Magauov said.
Edited by CN