Rada adopts bill on increasing royalty for gas production

The Verkhovna Rada adopted bill No. 7038-d on increasing the royalty for gas production during martial law and the state of emergency, MP Yaroslav Zhelezniak (the Holos parliamentary faction) has said.

"No. 7038-d – an increase in the royalty for gas production during martial law and a state of emergency," the MP said, mentioning the bill as adopted in his Facebook post on Tuesday.

According to the report, 270 MPs backed the bill with the required 226 votes.

On February 23, the Committee on Finance, Tax and Customs Policy recommended that the Verkhovna Rada adopt at the final reading finalized bill No. 7038-d on increasing gas royalties.

As Deputy Finance Minister Svitlana Vorobei said during the meeting, the revised version of the bill provides for an increase in budget revenues by UAH 30.6 billion in 2022 at the expense of private gas producers.

"The collected money will be used to finance the increase in salaries of the military, to ensure payments for eAid – these are the main directions," she said.

According to the deputy minister, the finalized bill provides for maintaining the current royalty rates at a gas selling price of up to $400 per 1,000 cubic meters.

"Excess profit, starting from $401 per 1,000 cubic meters, will be calculated at an increased rate, which is 2.2 times more for old wells, and three times more for new ones. Thus, the profitability laid down in drilling planning will be preserved for enterprises The current rates were introduced in 2018, when the price of gas did not exceed $300 per 1,000 cubic meters," she said.

Currently, the royalty for gas production from old wells for deposits at a depth of up to 5 km is 29%, at a depth of more than 5 km it is 14%.

When gas is produced from new wells drilled since 2018, the royalty for deposits at a depth of up to 5 km is 12%, at a depth of more than 5 km it is 6%.

Source: www.en.interfax.com.ua