UPDATE 2-Rosneft Q2 net soars 59 pct, wants tax breaks

* Q2 net $2.56 billion vs f'cast $2.66 billion

* EBITDA rises 33 pct to $4.75 bln, beats forecast

* Net debt at $15.8, down 15 percent from Jan.1

* Shares up 3.4 percent vs 1.2 pct MICEX rise

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By Jessica Bachman and Ekaterina Golubkova

MOSCOW, July 26 (Reuters) - Rosneft's (ROSN.MM) net profit jumped 59 percent in the second quarter from last year on higher oil prices and output, but Russia's largest crude producer cautioned that future growth hinges on energy tax changes.

Oil majors in Russia, the world's leading crude producer, want the government to switch to a profit-based tax regime that is applied equally to all output.

The Russian Energy Ministry has said a new regime, which will move away from the practice of taxing different oil fields at varying levels, will likely be in place by 2012-2013.

While Rosneft and other oil companies benefitted during the first half from zero export duties on crude from newly tapped East Siberian deposits, the stimulus measure was partially withdrawn from July. [ID:nLDE65F1Y8].

Rosneft's vice-president for finance and investments, Peter O'Brien, told Reuters on Monday the company would meet its target to increase output by between 4.5 and 5.0 percent this year despite the end of the tax holiday.

"The second half will be good and production will continue to grow, but we will be paying higher taxes. So with all else being equal I think it is fair to say profit on an after-tax basis will be reduced by between $400 and $500 million," he said.

Rosneft's giant arctic Vankor field, whose production stood at 265,000 bpd in June, is one of 22 East Siberian deposits that was exempt from the tax.

August duties for East Siberian crude remain 70 percent below the national rate. [ID:nLDE66E0G3]

ASSET SALE

O'Brien also said that reforming the tax regime is a critical first move if the Russian government decides to sell a minority stake in Rosneft through a share listing as part of a wider asset sale program announced earlier on Monday.

Russia is considering plans to sell minority stakes in major state-owned companies in the next three years to raise over $29 billion in the biggest Russian sell-off since the mass privatisations of the 1990s. [ID:nLDE66P0S0]

"If the government proceeds with the sale of the Rosneft share it would make sense to do so only after reforming the tax regime. (Then) we would have more clarity on the company's growth profile," O'Brien said.

Rosneft's net profit of $2.56 billion profit narrowly missed the $2.66 billion target forecast by analysts in a Reuters poll, but earnings before interest, taxation, depreciation and amortisation (EBITDA) rose 33 percent to $4.75 billion, beating expectations.

The company posted record free cash flow of $2.8 billion which it will in part tap as it extends capital expenditure during the second half, O'Brien told Reuters.

The company plans between $9 billion and $10 billion in capex this year, while only $3.8 billion was spent during the first half.

The company's average daily crude production rose 8.8 percent in the second quarter to 2.32 million barrels per day, up from 2.13 million bpd in the same period last year.

The firm, which acquired billions of dollars in debt while taking over assets that once belonged to defunct Russian oil firm YUKOS, knocked 15 percent off its total borrowings from the beginning for the year.

Net debt as of June 30 was $15.8 billion compared with $18.5 on Jan. 1 and its net debt-to-EBITDA ratio stood at 0.94.

The company said its average daily crude production in Q2 rose 8.8 percent to 2.32 million barrels per day, up from 2.13 million in the same period last year.

Rosneft's quarterly revenue was up 41 percent from a year prior to $15.43 billion and operating cash flow more than doubled to $4.89 billion from Q1 $2.29 billion.

The shares rose 3.4 percent to 206.25 roubles at the close of trade, outperforming Russia's MICEX index which closed up 1.2 percent. (Editing by David Holmes)