The issue of drafting the Subsoil Code is on the agenda

On 12 of September was held the 22nd meeting of the Committee of Oil and Gas Industry of the Presidium of NCE RK "Atameken" under the chairmanship of Daniyar Abulgazin, member of the Presidium of the Scientific and Production Enterprise of the Republic of Kazakhstan. The meeting was attended by Deputy Chairman of the Board of NCE RK "Atameken" Eldos Ramazanov, Chairman of the Board of JSC "NC" KazMunayGas" Sauat Mynbayev, General Director of the Association "KAZENERGY" Bolat Akchulakov, as well as representatives of the association and the National Chamber.

According to Daniyar Abulgazin, the agenda of the meeting included issues related to the drafting and approval of the draft Codes "On Subsoil and Subsoil Use" and the new Tax Code of the Republic of Kazakhstan, implementation of the program for equipping the production facilities of producers of petroleum products and gas stations with control meter devices.

The executive director of the Association "KAZENERGY" Zangar Nogaybay told about the current state of development of the draft Code "On Subsoil and Subsoil Use", noting that the conceptual task was to ensure the balance of interests of the state and subsoil users, the proper level of protection of interests from existing and future contracts on hydrocarbon raw materials , to increase the investment attractiveness of Kazakhstan's oil and gas sector in the context of a decline in world oil prices, and to provide conditions for the sustainable development of the industry.

"In addition, the principle of rational mining of mineral resources and a system of legal and institutional measures aimed at implementing this principle was envisaged. All innovations in the new Code are intended to stimulate investments in geological prospecting, simplification of access to contracts and protection of legitimate interests of subsoil users in relations with the competent authority, by clear regulation of all procedures arising in the practice of work under contracts", - Zangar Nogaybay said.

Nurlan Zhanekenov, Managing Director of the Association "KAZENERGY" made a report on the current work within the framework of the drafting the new Tax Code.

As the speaker noted, the purpose of the new Tax Code is to change ideology: all ambiguities and inaccuracies are interpreted in favor of the taxpayer; ease of use: a unified style of writing, elimination of duplication with by-laws, reduction of cross-references, reduction of the level of the shadow economy, stimulation of increased investments in subsoil use and other sectors of the economy of Kazakhstan" and elimination of ineffective benefits.

During the discussion of this issue, the members of the committee made recommendations on the issues of harmonization of draft laws in subsoil use and taxation. So, for example, the tax code uses the term "contract for combined exploration and production", whereas in the draft subsoil code in the designation of the relevant contract, the term "combined" is not used. The project operates with the concept of "contract for exploration and production of hydrocarbons", "contract for the extraction of hydrocarbons".

"As of today, there are questions on obvious aspects, different interpretations of concepts in laws are possible. This issue will require careful and separate study, and therefore, the transfer of the timing of the introduction of the draft law", - Sauat Mynbayev said.

The next issue of discussion was the implementation of the program for the installation of control meter devices (CMD). The participants were provided with information on the results of the on-site meetings of NCE RK "Atameken", representatives of state bodies and other interested parties on the objects of circulation and storage of fuels and lubricants in Astana. Inspection of the objects confirmed the fears that even with the installation of the newest CMD, incorrect operation of the devices and obtaining unreliable data related to different density of products from different refineries, icing in winter, temperature changes, etc., was possible. In view of the information provided, Committee members were invited to contact Government of the Republic of Kazakhstan with a proposal on the inexpediency of continuing the implementation of this program.

On the part of Atameken, KAZENERGY and the Fuel Association, the opinion was expressed that the issue of setting CMD will not solve the problem of shadow turnover, but will only exacerbate the financial burden on business and formally give grounds for suspending the operation of business facilities, which will lead to a deficit of fuel from 1^st of January 2018.

In turn, Bolat Auetaev, chairman of the Fuel Association added that the issue of pilots remained open, the first pilot was installed at Kostanay gas stations since June this year, and there are still no results.

"The National Chamber gets a lot of feedback from representatives of small and medium-sized businesses on the issue of CMD, they thank us that this work is carried out, the goals are clarified, and expert opinions are given. I note that the work in this direction is very good. The business community supports the initiative to abolish the program of implementation of CMD", - said Eldos Ramazanov.

Summarizing this issue, Daniyar Abulgazin noted that it is necessary to solve this problem.

In addition, the issues of current activity and reporting of a number of associations accredited at NCE RK "Atameken" were discussed and recommendations for their further work were given. Earlier, in the framework of the meeting of the Committee of the mining and metallurgical industry, issues of harmonization and improvement of the legislation on subsoil use in the field of solid minerals and the tax code were also discussed.