Page 7 - FSUOGM Week 08 2021

FSUOGM COMMENTARY FSUOGM

by 2025. of operation.
The group will also develop opportunities for We also contribute to the goals of sustaina-
the trading and wholesale of gas, in particular, ble urban and community development, health
and will enter the European trade market and promotion, decent work and economic growth.
start trading in forward physical and financial Our strategy over 10 years should lead to
products. Thus Naftogaz will develop its trading the creation of 290,000 jobs, GDP growth
opportunities to gain access to more profitable and national production of UAH233bn and
markets and increase its ability to hedge risks. UAH782bn ($28.1bn) respectively.

BS2/utility platform Rate of implementation and results
To become a full-fledged vertically integrated The new strategy of the Naftogaz Group sets
company working directly with end-users, the goals for the transformation of the Group by
Naftogaz Group will develop the B2C/Utility 2025, and also provides guidance for the further
Platform. development of the company by 2030.
"Six months ago the free gas market was In 2021-2025, we plan to increase the
launched. During this time, we have been cho- resource base and sustainable growth of the gas
sen as a supplier by more than 800,000 Ukrain- business, create a platform for supplying energy
ians. Our goal is to continue to offer customers solutions to customers and enter new low-car-
high-quality services at the best prices and to bon businesses. For this we will actively involve
become a partner for 4mn Ukrainian consumers partners and increase the understanding of our
by 2025, reaching a market share of 35%. We will customers and technical and commercial com-
provide the best prices by creating an effective petencies. Thus by 2025 we will carry out the
scalable model. For example, instead of creating transformation and ensure the readiness of the
our own physical network, we rely on working Group to the IPO.
with customers online and working through the These efforts will allow us to double the value
networks of our partners. In particular, we have of the Naftogaz Group. The levers for increasing
already started co-operation with the networks value will be to increase operational efficiency
of PUMB, Oschadbank branches and Privat- ($1-2bn), commercial efficiency ($2-3bn),
bank. This is the synergy that allows us to offer implement development and growth projects
win-win solutions for all," said Andriy Kobolev. ($3-4bn), and create a low-carbon business plat-
2021 should be a crucial year for the Group form (at least $1bn).
in building a platform for retail gas sales. If suc- "These are ambitious goals. We will be able
cessful, the company plans to go beyond the sales to achieve them only in the absence of political
of exclusively gas and to offer consumers quality interference in the work of the Group, timely
and competitive integrated energy solutions. issuance of licences and land allocation, con-
tinued reform of state property management,
Low carbon business platform timely approval of financial plans, enabling the
Caring about the ecological and social well-be- company to finance investments in growth and
ing of Ukraine is a fundamental principle of the efficiency by maintaining the existing level of
Naftogaz Group's work. Our main goal is to subsoil use fees for traditional deposits and a
achieve carbon neutrality by 2040. This will be predictable and development-oriented dividend
achieved through active investment in emission policy, as well as resolving issues of payments for
reductions and the development of new busi- gas supplied in the heat segment.
nesses, such as hydrogen and biofuel produc- "However, if we succeed, the Naftogaz Group
tion, as well as carbon capture, use and storage will become a catalyst for economic growth and
(CCUS). prosperity of the country. We are talking about
significant budget revenues, greater partner-
ESG (Environmental, Social and Govern- ship opportunities for financial institutions and
ance Criteria) businesses.
The Group is guided by the Global Sustainable "Last but not least, such a strategy will help
Development Goals. to create new jobs and new opportunities for
Achieving carbon neutrality is part of our Ukrainian workers who will be able to find well-
contribution to these goals. In particular, Objec- paid jobs in the country that will maximise their
tive 7 "Affordable and Clean Energy" and Objec- intellectual potential. Ultimately, all this will
tive 13 "Climate Change Mitigation". have a positive impact on GDP growth.
Taking care about the conservation of terres- "As a result, the implementation of our cor-
trial ecosystems, which are the 15th in the system porate strategy will allow us to realise our mis-
of the Global Sustainable Development Goals, sion and vision to unleash the full potential
we strictly adhere to the policy of biodiver- of Ukrainian energy markets and become an
sity protection and make internal and external energy partner chosen by consumers, employ-
audits, which in particular include ecological-bi- ees, financial and industry players, the state and
ological and hydrobiological monitoring of for- the people of Ukraine," said Otto Waterlander,
est, meadow and aquatic ecosystems in the areas chief operating officer of Naftogaz Group. ™

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