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9.2 Major corporate news 9.2.1 Oil & gas corporate news
JKX new well in Ukraine exceeds output expectations. JKX Oil & Gas (JKX LN) reported on May 2 that it successfully tested its WM3 well, the first drilled at its West Mashivska field in Ukraine. The tested production was 126,000 cubic meters per day of natural gas and 19 bpd of condensate, a total of 761 boepd, or higher than the company’s expectations. The company expects the well's initial production will reach 100,000 cubic meters per day (around 600 boepd). The expected production rate from this new well accounts for about 12% of JKX hydrocarbon output in Ukraine in 1Q19. So this well, if it produces in line with plans, should further contribute to the company’s boosted production in Ukraine. It marks the company's second consecutive successful new well in Ukraine.
JKX Oil & Gas reported on May 9 that it partially removed fish in Well-5 in Russia, but still will have to drill a sidetrack to bypass the remaining fish. The drilling of the sidetrack is expected to be completed in the first week of June, the company reported. Recall, JKX reported in early March that its drilling of Well-5 failed due to the parting of a drill pipe that left a large fish inside the well. If completed successfully, Well-5 will be able to contribute significantly to JKX’s output in Russia, where the company’s gas processing facilities are loaded currently by less than 50%. However, this won’t add much to JKX’s overall profit, as netback from natural gas sales in Russia is almost 7x less than in Ukraine. In any case, the news is encouraging for the company.
9.2.3 Transport corporate news
Antonov’s deal to build up to 300 An-132 cargo turboprops for the Royal Saudi Air Force has ended, apparently falling victim to the new Russia-Saudi rapprochement. Under a joint venture contract signed three years ago, Antonov and Taqnia Aeronautics were to build the advanced military cargo planes, some in Kyiv and some in Saudi Arabia. Two years ago, the first prototype flew from Antonov’s airport outside Kyiv. Each plane was valued at $30mn. India may replace Saudi Arabia in the project, Donets tells UNIAN. Two months ago, an An-132D was flown in a demonstration flight in Bangalore at Aero India 2019. Traditionally supplied by Soviet aircraft, India’s air force uses 104 An-32 cargo planes, the 1980s/1990s predecessor of the An-132D. Antonov has signed a commitment to participate in the ‘Make in India’ program and is now waiting the outcome later this month of India’s general election.
9.2.4 Construction & Real estate corporate news
Israeli developer Ofer Kerzner is to start building this year an 8-story, 264-room hotel near Kyiv Boryspil’s Terminal D, Georgy Zubko, the airport’s deputy director for development, tells reporters. Owner of property development company City Capital Group, Kerzner built Art-Zavod Platforma, recycling a former weapons plant into a popular cultural centre.
Kyiv’s tightening office real estate market is prompting Alexander Yaroslavsky’s DCH Group to revive a $50mn business centre project at the northern end of Podol’s Mezhyhirska street. With construction planned for next year, the Class A office centre would have 40,000 square meters of
68 UKRAINE Country Report June 2019 www.intellinews.com