"We would like to see the tax burden on oil companies drop significantly to 65% of earnings by 2020 from the current 73%," Shmatko told reporters after a governmental meeting in Novokuibyshevsk in the Volga region on development of the oil industry until 2020.
Speaking earlier in the day at the meeting, Russia's Prime Minister Vladimir Putin said work on developing changes to the current tax system should soon be completed.
The final proposals on the new tax system with concrete rates and timeframes for their introduction should be agreed with all the relevant ministries by the end of the year, Putin said.
"I hope that by next summer, it will be submitted to the State Duma [for approval] so that investors can understand in what conditions they are to work, what the rules of the game are and can develop their long-term strategies," Putin said.
The government is considering introducing a special tax regime for new fields and different tax rates of the mineral extraction tax, equalizing export duty for light and heavy products as well as switching to a profit-based tax system from the current revenue-based system at a later stage.
Putin said cuts in mineral extraction tax granted to certain old fields had already helped raise oil production in the Volga region, one of the oldest oil provinces in Russia, by nearly 10% to 102 million mt/year (2.04 million barrels/day) from 93 million mt/year over the last several years.
Putin said the government was also considering a new tax system for certain new projects that could not be developed without the state's support.
"We will be introducing a tax system that would allow minimizing expenditures at the most difficult, initial stage of a project," Putin said.
The tax burden would be increased at a peak production stage and then reduced again at the final stage of a field's natural decline, Putin said.
He mentioned Rosneft's Vankor and Lukoil's projects in the Caspian Sea among projects for which such benefits are to be implemented.
Under the draft program, that the government mainly approved Thursday, Russia's oil production would stay at between 501-505 million mt/year (above 10 million barrels/day) until 2020, with total investments into the industry to amount to some Rb8.6 trillion ($280 billion).
Tax incentives approved in the previous years helped Russian crude production rise gradually in recent years and stay above 10 million b/d, according to the energy ministry.
In the latest record high of September, the country's output rose by 1.6% year-on-year to 10.12 million b/d.
Oil output had been growing mainly due to the startup of new fields such as Rosneft's Vankor field in East Siberia in August 2009 and TNK-BP's Uvat field in West Siberia in February 2009.
The effect of these new field startups, however, has now peaked and Russia is shifting focus to the development of new, hard-to-access reserves to maintain production.
Nonetheless, the energy ministry expects that around 70-80% of the country's overall crude production would be still producing in old oil provinces by 2020 and is considering tax benefits for matured fields as well.
"Despite the benefits that are being provided to encourage greenfields, it is more effective from the point of view of the state budget to give tax benefits to old fields," Shmatko told reporters.
The oil industry accounts for over 40% of Russia's budget incomes at the moment, according to Putin.
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