Prime Minister of Lithuania Algirdas Butkevicius is positive that draft laws prepared by the Ministry of Environment over taxation of shale gas exploration and extraction will meet no hurdles and will be adopted, reports LETA/ELTA.
Talking to the national radio LRT Butkevicius informed that the Ministry of Environment has submitted for deliberations of the Government the draft law on Taxation of Shale Gas Exploration and Extraction, and it will be considered on Wednesday.
According to the prime minister, the specialists have analysed shale gas exploration activities in Romania, Great Britain and Poland. In the nearest future the Government should approve the base shale gas extraction tax rate – 12% for conventional hydrocarbons with no differentiation based on extraction site or annual extraction volume; whereas 15% would apply to unconventional hydrocarbon shale.
According to the head of the Government, in order to attract investment into shale gas exploration and extraction it has been proposed to apply zero base tax rate on shale gas for three years since the authorisation date to use these resources but no longer than 1 January 2020.
Butkevicius said that additionally it has been proposed to transfer 90% of the tax to the state budget and 10% to municipalities where extraction takes place, so that they are also interested in attracting investment.
After the draft laws are approved by the Government they will be submitted to Parliament. The prime minister is sure that the laws will pass in Parliament and afterwards a public tender will be announced.
Butkevicius added that the US company Chevron withdrew from shale gas exploration tender because there was no political consent in Lithuania.