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9.2 Major corporate news 9.2.1 Oil & gas corporate news
JKX 3Q19 hydrocarbon output rises 25% y/y. JKX Oil & Gas (JKX LN) produced 11,719 boepd of hydrocarbons in 3Q19, the company reported on October 9. This is 24.5% more y/y and 13.2% more q/q. The rise was driven by improved performance in both its Ukrainian assets (5,627 boepd, up 54.9% y/y and 15.9% q/q) and Russian assets (5,502 boepd, up 3.8% y/y and 10.3% q/q). The increasing production at its Ukrainian assets was mostly a result of new well IG-142 (which produced over 900 boepd since its commissioning in July), as well as the performance of two less productive new wells commissioned in mid-2Q19. In 9M19, JKX boosted its hydrocarbon output 19.1% y/y to 10,668 boepd, driven solely by a 50.9% y/y surge in Ukrainian asset output to 5,535 boepd. The company also reported on its satisfactory liquidity position with a $9.5mn cash balance and $11.5mn of hydrocarbon inventory as of end-September. After implementing an active drilling program in Ukraine since early 2018 and a series of successful wells drilled, JKX is demonstrating improving oil and gas production for the third quarter in a row.
JKX wins court battle against $2.3mn tax claim. JKX Oil & Gas (JKX LN) reported on October 22 an appellate court had ruled in its favor in its defense against Ukrainian tax authorities' claim of tax liability and penalties totaling $2.3mn. The ruling upholds the decision of the Poltava Circuit Administrative Court in favor of JKX, rejecting the government's argument and marking the second victory against the 2015 tax claims, the company reported. Recall, JKX underpaid a total of $12.7mn in taxes in 2015, which lead to total tax and penalty claims against the company of $33.5mn (as of end-1H19). This amount has been split into eight separate court cases. The first case for a total claim of $0.3mn finished in favor of JKX in July 2019.
9.2.3 Transport corporate news
Over the next five years, UZ plans to buy or renovate 200 locomotives,
800 passenger cars, 10 Intercity electric trains and 5,000 km of track, the government reports. In a pilot project, public-private partnerships are to be used to modernize three trains stations: Kyiv, Mykolaiv and Zaporizhie.
Breathing new life into Antonov’s Kyiv region assembly lines, the Interior Ministry plans to buy 14 new model Antonovs, in a purchase estimated at half a billion dollars. Minister Arsen Avakov tweets the ministry will buy 13 An- 178s – a short-range military airlift jet. The Ministry will also by an An-32P firefighting turboprop.
The EBRD plans to loan Ukrzaliznytsia $100mn to modernize Ukraine’s portion of the Trans-European Transport Network, or TEN-T, Yevhen Kravtsov, the state railroad CEO, writes on Facebook. Stressing the tender will follow EBRD rules, he writes: “70% of the $100mn will go to modernize infrastructure..30% will go to updating of [electronic systems].”
Kyiv’s Boryspil Airport saw 24.2% more traffic in August 2019, making it the second fastest-growing airport in Europe, only behind Milan Malpensa, reports on Facebook Georgy Zubko, Boryspil’s director for commercial and strategic development.
71 UKRAINE Country Report November 2019 www.intellinews.com