Page 66 - UKRRptOct19

9.2 ​Major corporate news 9.2.1​ Oil & gas corporate news
Naftogaz group paid UAH 79.8 billion in taxes and duties to the state budget ​in January-August 2019. Naftogaz group’s contribution accounted for 15.7% of the state budget revenue in the first eight months of 2019. Naftogaz group remains Ukraine’s biggest taxpayer. In 2018, the group paid UAH 137.8 billion in taxes and dividends to the state and local budgets.
Naftogaz group has imported its maiden batch of oil products from Belarus ​for sale on the Ukrainian market. “We will supply 30,000 tons of diesel fuel manufactured by the Mozyr Oil Refinery to the Ukrainian market in September. This will be sold along with in-house produced fuel. We plan to actively develop our trading segment, as it is very important to satisfy Ukraine’s demand and diversify sources,” commented Mykola Havrylenko, head of Naftogaz group’s oil unit. Thanks to these imports, Naftogaz group’s sales of diesel fuel in September will more than double. This will have a positive effect on the market, considering the anticipated deficit of diesel fuel in Ukraine during September and October. Naftogaz group produces up to 10,000 tons of diesel fuel per month, while consuming about half of this amount. Previously, Naftogaz group had only imported raw materials for its refining facilities
Naftogaz has signed an agreement with a major international trader for guaranteed physical deliveries of around 450 mcm of gas in Q1 2020. “​Thanks to the developed European gas market, and despite the risk of gas transit interruption by Russia this coming winter, we have contracted the required volumes with physical delivery in Q1 2020. We have ensured the proper preparation for the coming heating season, injected additional gas volumes to our UGS facilities, made our GTS ready for operation without transit, and contracted physical gas deliveries that do not depend on Gazprom’s behavior. This gives us confidence that the winter season will be warm in Ukraine, whatever our northern counterparts may do,” commented head of Naftogaz integrated gas business unit Andrew Favorov. Naftogaz is now considering several more offers from major European traders regarding gas supplies after the New Year and will use them if it is commercially justified.
Gas stocks in Ukrainian UGS facilities are 4 bcm higher than previous year as of 17 September 2019​ Ukraine has increased gas volumes in its UGS facilities to 19.5 bcm, which is 4 bcm higher than the previous year. “We started preparations for the heating season back in April. Our gas stocks have reached 19.5 bcm, which is 4 bcm higher than the previous year. Taking into consideration the physical deliveries contracted by Naftogaz for Q1 2020, we can state that Ukraine has enough gas for the coming winter,” Naftogaz CEO Andriy Kobolyev said. Naftogaz will continue injections into the country’s UGS facilities until the beginning of the heating season.
With European gas prices almost two thirds below the peak of one year ago, Ukraine’s household gas prices are not expected to be a debating point with the IMF​. With stocks high and production strong, European gas prices could drop another 20% this fall, according to analysts quoted by Bloomberg. Ukraine has 19bn cubic meters in storage, almost enough to get through the winter. Prime Minister Honacharuk confidently told reporters recently: “When a politician starts to interfere with the price, it leads to two
66​ UKRAINE Country Report​ October 2019 ​ ​www.intellinews.com