Postpones Shtokman decision until after Presidential election
The shareholders met in Moscow on Thursday and decided to await necessary conditions (read tax cut). Final investment decision will be taken by the end of March.
Board of Directors meeting in Moscow on December 29 assessed the progress in the Shtokman project as good, but said additional time is required to achieve the necessary conditions to make a final deal on putting money into the development of the huge natural gas field in the Russian part of the Barents Sea.
Although not stated in the press-release from the shareholders, the necessary conditions in question are related to tax cut on the investment and governmental promises on reduced export duties for natural gas. The two foreign partners in Shtokman Development AG, Statoil and Total, have clearly said such tax cuts are required in order to make the project profitable.
The Board of directors says in a statement that they now postpone the final investment decision until the end of March 2012. Russian Presidential election takes place on March 4.
President of Shtokman Development AG’s Board of Directors, Gazprom’s Alexei Miller says after Thursday’s meeting that all shareholders are determined to continue their good and close cooperation.
The questions about tax cut and reduced export duties for natural gas were supposed to be cleared out before the yearend 2011, but following the December 4 Duma elections several opposition parties have demanded to increase the taxes from Gazprom’s gas production and export instead of reducing them, as reported by BarentsObserver before Christmas.
A postponement of the issue till after the Presidential election by the Russian government can therefore be seen as a natural step in order to avoid further political disturbance between Prime Minister Vladimir Putin and the opposition. Putin has already started his presidential campaign race.
