E.Siberian oil tax breaks could start June 1 -report

MOSCOW, May 18 (Reuters) - Russia could abolish export tariffs on oil produced at new East Siberian fields from June 1, Energy Minister Sergei Shmatko was quoted by RIA Novosti news agency as saying on Monday. The tax cuts are designed to stimulate production in hard-to-access oilfields after Russian output declined last year for the first time in a decade, and were first proposed at an industry meeting in February. [ID:nLC831078]

"We estimate such a decision could be taken from June 1," RIA Novosti quoted Shmatko as saying.

Russia, the world's second-largest oil exporter, must balance its need for oil export revenues against the demands of the budget as the country enters its first recession in a decade.

During the February meeting in the refining town of Kirishi, Prime Minister Vladimir Putin proposed a temporary lowering of export taxes on new East Siberian deposits in order to boost investment.

Beneficiaries could include state-controlled industry leader Rosneft (ROSN.MM: Quote, Profile, Research), which plans this year to launch its huge Vankor field, as well as TNK-BP (TNBPI.RTS: Quote, Profile, Research) and Surgutneftegas (SNGS.MM: Quote, Profile, Research), which own fields in the region. (Reporting by Robin Paxton)