Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

New Gas Fields May Bring Tax Breaks

Russia may give gas export monopoly Gazprom and other firms tax breaks to tap new fields in East Siberia and the arctic Yamal peninsula following similar breaks for oil producers, an official said.

"Both Yamal and East Siberia are being discussed ... It could become a good spur for both Gazprom and independent producers to increase production," Deputy Economic Development and Trade Minister Kirill Androsov told reporters Thursday.

He said a decision could be made in the fourth quarter of 2007 or the first quarter of next year.

Russia counts on East Siberia, Yamal and the Arctic shelf as future areas of growth in oil and gas production that will allow it to compensate for flagging production in West Siberia and have enough crude to fill new pipelines to Asia.

Androsov also said Gazprom had pledged not to use cash when merging its power assets with coal and power assets of energy major SUEK. "We have received pledges from Gazprom that the deal would not involve cash injections. The management believes it can be done that way," he said.

Media reported earlier this week that the two firms have postponed the merger due to asset valuation differences.

Gazprom's assets are worth around $4.8 billion, while SUEK's assets are currently estimated at $6.3 billion as it plans to contribute coal assets to the new venture alongside its power stakes.

Androsov said the government was against Gazprom injecting cash as it would further increase its heavy borrowings.

Gazprom is seeking to acquire 50 percent plus one share in the joint venture, while SUEK would get the rest.