Oil Price Fluctuations not to Affect Hand-Over of AIOC Assets to Azerbaijani Government: Deputy Minister
Azerbaijan, Baku, 7 November/ Trend , corr I. Khalilova/ Drop in oil prices in global markets will not have any impact on a date of transfer to zero balance due to high time for complete re-payment of investments of foreign investors within the development of AzeriChiraq-Gunashli bloc of fields in the Azerbaijani sector of the Caspian, deputy taxes minister Natig Amirov said.
"Average annual oil prices exceed $100, therefore, the transfer is possible until the end of this year which depends on accounting of foreign oil companies," Amirov said.
Hand-over of assets of Azerbaijan International Operating Company (AIOC, operator of Azeri-Chiraq-Gunashli bloc of fields) to the Azerbaijani government is expected to begin in 2009, according to SOCAR President Rovnag Abdullayev.
A working group of representatives of SOFAZ, SOCAR and AIOC has been set up to prepare for this process. The working group will complete the work by the end of 2008. At the moment, the working group is discussing hand-over of assets to the government and schedule of activities after that.
Oil prices in global markets affected acceleration of repayment of investments. Due to the high time for zero balance, assignments of AIOC and its partners on tax profit tax will also contract by the end of year.
However, deputy minister said the funds for 2008 have already been assigned to the state budget. In the Q1 of 2008, AZN 1.296bln (including advance for Q4 of 2007) were transferred to the budget. Though Ministry of Finance's expectation was AZN 1.75bln-AZN 1.8bln at the end of the year, this forecast was fulfilled as of the end of August. Tax agencies do not expect considerable assignments till the end of the year.
World oil prices affect rise in budget assignments from oil companies and distribution of oil revenues between government and foreign companies which carried out at 80/20 at present.
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