Greek gov’t promises tax cuts to attract oil and gas firms

Greece is planning to cut tax rates for oil and gas companies as it wants to attract them to help exploit its untapped offshore hydrocarbon resources, its energy minister said on Tuesday.

Under the plan, oil and gas explorers will pay 25 percent tax, down from 40 percent currently, and 5 percent of the tax will go to local communities.

“We have done this in order to incentivize our investors to invest in the future of Greece,” Yiannis Maniatis (photo), Greece’s energy minister, said at a conference in London.

He did not say when the new tax rates would come into effect.

Debt-laden Greece, which spent 15.6 billion euros to import fuel last year, or about 8.6 percent of its gross domestic product, has launched an ambitious program to discover big hydrocarbon reserves.

It has been inspired by large gas finds offshore from nearby Israel and Cyprus.

Maniatis also announced the tender of Greece’s first large-scale oil and gas exploration licenses after several fruitless attempts over the past decades to make big oil discoveries.

A group of Greek government oil and gas experts is meeting representatives from BP, Shell, Total and ExxonMobil and other oil companies in London on Tuesday and Wednesday, a government source said.

Once the tender is officially published in the coming weeks, oil and gas producers will be able to bid for licenses covering 20 blocks located south of Crete and in the Ionian Sea.