Russian crude production continued its positive growth trend in June, with overall output increasing by 2.1% year-on-year. But some in the industry are questioning how long Russia can maintain such production levels in the face of a predicted decline at mature fields, and the high costs associated with new techniques to maximize production. At first glance, Russia's June production data looks positive. The country produced 43.083 million mt, or 10.484 million b/d, in June - a new post-Soviet record. With production in the first six months of the year totaling just under 259 million mt, it is also on course to meet its target of producing 518 million mt (10.36 million b/d) in 2013, flat on 2012. While Russia's official strategy up to 2020 targets production levels of 505 to 510 million mt/yr of crude, the government is aiming to produce more than that. Officials have introduced tax incentives, such as cutting the marginal export duty rate by 5%, to encourage companies to develop reserves that were previously considered not economically viable. In July, the lower house of the Russian parliament backed proposals to remove Mineral Extraction Tax for tight oil produced at the Bazhenov formation in West Siberia. If these are approved by the upper house and President Vladimir Putin, the tax breaks will come into effect next January.
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