The Federal Agency for Mineral Resources (Rosnedra) has submitted proposals on extra incentives for businesses, engaged in geological prospecting operations, to the Russian Ministry of Natural Resources and Environment. These measures include tax deductions for supporting the sector, according to Rosnedra Head Oleg Kazanov.

“There are two ways to attract funding into the geological prospecting sector. The

first option is direct incentives, so that mineral deposits’ users would profit from these activities. For example, we suggest introducing tax deductions and reducing profit taxes by the value of prospecting operations with a multiplying factor.

According to Kazanov, there are plans to stipulate a three-point multiplying factor for the Arctic and a 1.5-point multiplying factor for other regions.

The agency’s specialists also believe that geological prospecting operations can be effectively expanded by encouraging output. “For example, it becomes possible to expand production at previously unused oil and gas fields by listing hydrocarbon deposits among hard-to-extract reserves in accordance with additional criteria and by applying special tax regimes. This, in turn, inevitably boosts the volume of geological prospecting operations,” Kazanov noted.