Page 18 - FSUOGM Week 06 2021
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FSUOGM                                       NEWS IN BRIEF                                          FSUOGM


       exceed to $200 per 1,000 cubic metres in   government, Justice Minister Denys   such as the state procurement of oil, a high-
       2021, Alexander Invannikov, head of the   Malyuska reported on February 4. In   level Ukrainian official told bne IntelliNews,
       company’s financial department, said in a   particular, the court decided that it has no   among other schemes.
       conference call on February 9.      jurisdiction to hear the claim, Malyuska   “Kolomoisky, as a powerful minority
         “The budget we approved in December   wrote, calling the event as “super mega   shareholder in Ukrnafta, was always a
       2020 was built on an export price of around   victory."                  headache for Naftogaz, so the intention of
       $170 per 1,000 cubic meters, but now, given   This comes after one day when The   the state company to divorce itself from
       the results of January, we may definitely   Ukrainian government started the   this group is natural. If the separation
       say that we expect the average annual   separation process of national gas company   happens, this will add stability to Naftogaz's
       export price for gas of $200 plus. I mean   Naftogaz and Ukrnafta on February 3.  operations. However, the process does not
       significantly above $200, which exceeds   The size of the claim had exceeded $6bn,   promise to be fast: most likely it will take
       previous pricing guidelines and scenarios   which Ukrnafta shareholders (three Cypriot   a couple of years,” Alexander Paraschiy of
       included in the budget for next year by   companies controlled by Ihor Kolomoisky   Concorde Capital said in a note.
       more than $30,” he said.            and Hennadiy Bogolyubov, owning a      The separation of Naftogaz and Ukrnafta
         He also said that the company was   40.1% stake) had demanded from Ukraine.   comes only a week after Ukrainian
       considering options for reducing 2021   The claim was related to compensation of   President Volodymyr Zelenskiy launched
       borrowing and, correspondingly, the   minorities’ alleged losses from Ukrnafta’s   an assault on Viktor Medvedchuk, the head
       company’s debt burden.              unfavourable natural gas price regulation   of the Political Council of the Opposition
         “We plan a decrease of the debt burden   and taxation imposed in late 2000s. The   Platform, For Life Party, by closing down
       in 2021, if we see stable high gas prices in   initial size of the claim was $4.7bn, as was   several TV stations associated with the
       Europe. We are considering cutting the   reported in 2016.               Ukrainian politician, who is a close personal
       debt planned for 2021 and in general the   Interestingly, according to the zn.ua   friend of Russian President Vladimir Putin.
       debt burden that Gazprom has today if the   news site, the court motivated its dismissal   This week Zelenskiy issued sanctions
       volumes and prices that are currently on the   of the case, amongst other, by its suspicion   by presidential decree – which can only
       market remain consistent,” he said.  that the plaintiffs’ investments in Ukrnafta   be challenged by the Supreme Court and
                                           were “tainted by bribery and corruption.”  not the corrupt regular courts that are
                                              “Taking into account the size of   under the control of the oligarchs – against
       Lukoil says oil output rises        potential losses of Ukraine from the case,   pro-Moscow MP Taras Kozak, who is
                                                                                the nominal owner of the TV stations
                                           this is indeed a big victory of Ukrainian
       by 2.8% in Oct-Dec                  government. Besides removal of a risk of   associated with Medvedchuk.
                                                                                  Medvedchuk is also partnered with
                                           huge payments from the state budget to
       Oil production of Russian oil company   Kolomoisky and Bogolyubov, the court’s   Kolomoisky and owns just under 25% of
       Lukoil grew by 2.8% on the quarter to 18.8   ruling increases leverage of Naftogaz in its   his media empire that includes the major
       mn tonnes in October–December 2020, the   upcoming negotiations on Ukrnafta’s assets   broadcaster 1+1. Kolomoisky has been
       company said in a statement on February 8.  separation between the government and the   credited with putting Zelenskiy into office
         In the whole of 2020, production   minority shareholders,” an analyst at the   by using his media assets to back Zelenskiy's
       decreased by 10% on the year to 77.206mn   Kyiv-based Concorde Capital brokerage said  presidential campaign in 2019; however,
       tonnes, excluding production on the West   in a research note.           it increasingly appears the two have fallen
       Qurna-2 field in Iraq on the back of an                                  out as Kolomoisky lobbies to reverse the
       OPEC+ agreement signed in April 2020,                                    nationalisation of PrivatBank that he owned
       which led to production cuts.       Naftogaz initiates split             until 2016.
         The OPEC+ countries agreed to reduce                                     As bne IntelliNews reported, all of the
       their oil output by 9.7mn barrels per day   of Ukrnafta amid risk of     countries of the Former Soviet Union (FSU)
       in May 2020 to fight the consequences of                                 are suffering from “The Oligarch Problem”,
       the global coronavirus crisis, with Russia’s   multi-billion claims from   which is especially bad in Ukraine.
       share of 2.5mn barrels per day. The cut                                    Analysts speculate that following the
       was narrowed to 7.7mn barrels per day   minorities                       first call with the newly installed Biden
       for August–December 2020, and then to                                    administration in the US, Zelenskiy has
       5.8mn barrels per day until May 2022. The   The CEO of Ukraine’s national gas company   been promised support as part of the US
       agreement is valid until April 30, 2022, but   Naftogaz, Andriy Kobolev, has started the   campaign to meet what it sees as a Russian
       the members will revise its extension in   process of separating the gas company from   threat, but at the same time Washington
       December 2021.                      Ukraine’s leading oil company Ukrnafta   wants to see some results in the fight against
                                           as the battle between the state and the   corruption in Ukraine that is embodied by
                                           oligarchs heats up.                  the oligarchs.
                                              Kobolev sent a letter to the supervisory   Naftogaz owns 50%+1 shares in Ukrnafta
       EASTERN EUROPE                      board asking its members to “study the   and wants the board to consider dividing
                                           possibility of dividing the company’s assets   the company by business directions to
       Stockholm Arbitration court         between two groups of shareholders,”   further separate Naftogaz from a group of
                                                                                minority shareholders that are related to
                                           Interfax-Ukraine reported on February 3.
       dismisses claim of Ukrnafta         government’s recent attempts to rein in   Kolomoisky, who owns with his partners at
                                              The move is the latest in the
                                                                                least a 41% stake in the company.
       minorities to Ukraine               the country’s powerful oligarchs that have   creation of a working group for the asset
                                                                                  In his letter, Kobolev asks for the
                                           inserted themselves into the structures of
       After six years of litigation in Stockholm   many of Ukraine’s most valuable assets.   split, the hiring of one of the big-four audit
       Arbitration, the court dismissed the claim   Oligarch Ihor Kolomoisky is a major   companies to undertake an assets valuation
       of three Ukrnafta (UNAF UK) minority   shareholder in Ukrnafta and has run scams   and the appointment of a legal advisor
       shareholders against the Ukrainian   in the past to siphon off cash from things   that will conduct the process, Concorde



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