Page 18 - FSUOGM Week 33

FSUOGM NEWS IN BRIEF FSUOGM

RUSSIA The revenue of its Ukrainian assets pipeline decreased by 8% in 2019 to 31.135mn
decreased 28% y/y to $26.8mn, mostly on tonnes.
Russian production meets the back of a decrease in hydrocarbon prices, Azeri, Chirag and Guneshli (ACG) oilfields
The BTC pipeline exports oil from the
while its revenue in Russia grew by 2% y/y as
OPEC+ caps a result of higher hydrocarbon output (up 7% operated by BP.
The volume of transit oil—crude
y/y).
Russia produced 9.78mn barrels per day of oil “The company’s EBITDA decreased originating in Kazakhstan—through the BTC
and natural gas condensate between August 1 22% y/y, we estimate, to $14.4mn, while the fell to 2.418mn tonnes in January to July from
and 18, Reuters reported on August 19, citing EBITDA margin stood flat y/y at 41%. JKX’s 2.727mn tonnes in the same period a year
unnamed sources. net income fell 30% y/y to $1.5mn,” Alexander earlier.
Russia has agreed to limit production Paraschiy of Concorde Capital said in a note. Azerbaijan also exports oil via Russia
of 9mn bpd under an agreement between The company has no borrowings as of end- through the Baku-Novorossiisk pipeline and
OPEC+ members. The production cap June, while its cash balance stood at $14.4mn via Georgia by rail and through the Baku-
excludes condensate, however, with Russia (vs. net cash of $14.9mn as of end-2019). It Supsa pipeline.
understood to produce 700,000-800,000 bpd also reported that it had secured a $5.0mn Turkmenistan also historically exported
of the fuel. credit line from Alfa Bank in July to finance its some crude via the BTC. However, it switched
Given the above numbers, Russia appears possible short-term needs. its flows to a Russian port in 2019.
to be maintaining its compliance with OPEC+ “As natural gas prices are likely to recover
caps on production. The Energy Ministry said in Ukraine in 2H20, the company’s P&L is set
at the start of the month that July’s oil output to slightly improve, even though the absence Kazakhstan’s oil and
in was unchanged from June levels, when of active drilling operations in 1H will lead
compliance was 99%. Crude and condensate to a gradual decline of hydrocarbon output condensate production
production increased to 9.37mn bpd in July in Ukraine (by 6-7% on quarterly basis). The
from 9.32mn bpd in June. recovery of drilling and workover operations down 1.4% y/y in Jan-July
in late 2H20, along with the expected recovery
of natural gas prices, should result in JKX’s Kazakhstan’s oil and condensate
Novatek could improve P&L improving in 2021. We remain positive production declined by 1.4% y/y in the first
seven months of 2020, Kazakhstan’s Energy
on JKX’s mid-term value growth,” Paraschiy
dividend policy added. Minister Nurlan Nogayev told a government
meeting on August 11.
Russia’s second-largest natural gas producer The decline in oil production was driven
and liquefied natural gas (LNG) leader Naftogaz paid UAH77.9bn to by Kazakhstan’s need to fulfill agreements
Novatek will improve its dividend payments, reached by OPEC+ earlier this year.
the CEO of the company Leonid Mikhelson state budget in 7M20 “Production of oil and condensate
told the press on August 14 as cited by Reuters amounted to 51.5mn tonnes in the first
and Interfax. Naftogaz Group paid UAH 77.9 billion to the seven months of this year. This is 1.4% lower
Reportedly, the dividend policy could state and local budgets in January-July 2020, compared to the same indicator in 2019,”
be revised upwards at the upcoming board including UAH 39.6 billion of remaining Nogayev said.
meeting of August 25, one of Russia’s richest dividends for 2019. Oil exports in the period amounted to
men Mikhelson said. Revenues from Naftogaz Group exceeded 42mn tonnes, up by 0.4% y/y. Gas production
As reported by bne IntelliNews, previously 17% of total state budget revenues in January- for the first seven months of 2020 amounted
Mikhelson pledged to decide on the dividends July 2020. to 33.4bn cubic metres, registering a 1%
in 2Q20. For 2Q20 under IFRS Novatek Naftogaz Group remains Ukraine’s biggest increase from the same period last year.
showed $2bn in total revenues, $0.99bn total taxpayer. In 2019, Naftogaz Group’s tax and US-Kazakh joint venture TengizChevroil
Ebitda (including joint ventures such as dividend payments to budgets of all levels (TCO) said on August 11 that crude
Yamal LNG) and net income of $0.58bn. The totaled nearly UAH 121.4 billion. production in the first half of 2020 stood at
company beat the consensus expectations NAFTOGAZ GROUP, August 12, 2020 14.26mn tonnes. The production level was
on top and bottom lines by 2% and 7% recorded at 28.6mn tonnes in 2019.
respectively. “In the first half 2020, TCO sold over
Novatek has completed Russia’s largest CENTRAL ASIA & SOUTH 725,000 metric tonnes of LPG, 3.9bn cubic
LNG project Yamal LNG and is developing metres of dry gas and over 1.3mn tonnes of
the Arctic LNG-2 project. Previous reports CAUCASUS sulfur,” the press service of TengizChevroil
suggested that more co-operation with foreign said.
energy majors on LNG projects is possible. Azerbaijan’s oil exports via
BTC slump 11% in 7M-20

EASTERN EUROPE Azerbaijani oil exports via the Baku-Tbilisi-
Ceyhan (BTC) pipeline that runs through
JKX decreases EBITDA 22% Georgia and Turkey declined by 11% y/y
in the first seven months of this year to
y/y in 1H20 16.745mn tonnes, according to Azerbaijan’s
State Statistics Committee.
Ukraine’s leading independent oil and gas Total oil exports from Azerbaijan in
producer JKX Oil & Gas Plc reported revenue the period amounted to 20.997mn tonnes.
down by 23% year on year at $35.1mn in Around 80% of that total went through the
1H20, the company said on August 11. BTC. Azerbaijan’s oil exports through the

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