Page 53 - UKRRptAug21

9.2.7 TMT corporate news
Ihor Smilyanskyi, CEO of Ukrposhta, is setting ambitious goals for the next two years of his management of the national postal service. He posts on Facebook that his 5-year development strategy is: to create a postal bank that will be one of Ukraine’s five largest banks; to grow Ukrposhta into a company with $1bn in revenues by 2026; to digitize the entire system and build a network of sorting centres near big city ring roads; to launch 2,000 mobile branches, ensuring that banking services reach the entire nation; and to attract a strategic international investor to buy at least 25% of the company. Last week, Ukrposhta’s Supervisory Board unanimously voted to extend Smilyanskyi’s contract for another two years.
9.1.10 Renewables corporate news
Ukraine’s largest iron ore pellet exporter Ferrexpo launched a pilot 5MW solar power plant, according to Interfax-Ukraine’s report that cited a July 16 press release by the company.
Ferrexpo’s investments amounted to severalmn dollars, and the plant’s yearly production will amount to 6.5-7 GWh. The company plans not to sell the electricity produced into the market but instead consume it for pellet production. Ferrexpo’s midterm plans include constructing a renewable energy power plant with a capacity of 250-1000 MW, the release said.
The planned 250-1000 MW power plant will be a significant project for Ferrexpo. The total investments will amount to up to $0.25-1bn, we estimate. This is 2.4-9.7x Ferrexpo’s 2020 development CapEx ($103mn) and 1.3-5.1x the amount of dividends it paid in 2020 ($195mn).
Nevertheless, this project might be easily spread over several years, limiting the redirection of cash from dividends. Furthermore, Ferrexpo might attract external green financing for the plant’s construction, which will minimize the project’s effect on the company’s dividend payouts.
The planned solar plant will cover 18-70% of Ferrexpo’s electricity needs. Producing this much solar electricity might require either storing it or selling it into the market.
The 5MW pilot plant’s electricity production will amount to only 0.4% of Ferrexpo’s electricity consumption on an average yearly basis.
The above estimates use production volumes of 12 mmt of pellets per year with a consumption coefficient of 160 kWh per ton of pellets. We assume the larger plant Ferrexpo intends to build will also be a solar power plant that would cost about $1,000 per kW to construct and would produce electricity at full capacity for about 3.7 hours on an average calendar day, similar to what we estimate for the pilot plant.
53 UKRAINE Country Report August 2021 www.intellinews.com