Page 48 - UKRRptApr19

9.2 Major corporate news 9.2.1 Oil & gas corporate news
The Ukrainian cabinet will extend a contract with CEO of the nation's state-owned natural gas monopoly Naftogaz Andriy Kobolev for one year , Volodymyr Groysman said at a government meeting on March 20. The statement followed last week's proposal of the company's board to extend a contract with Kobolev for one year, until March 22, 2020, according to a letter signed by the board's head Clare Spottiswoode. At the same time, the board has proposed to halve the current level of the company head's salary to UAH520,500 ($19,461) without paying monthly and quarterly bonuses. However, Kobolev can claim for bonuses based on the results of work for 2019 if the nation's gas pipeline operator is created ready for certification, and gas production is increased by January 1, 2020. Meanwhile, Groysman said on March 20 that a tender to select members of the board of Naftogaz will take place on March 20, 2020. The PM added that the extension of the contract with the current Naftogaz board for a year is an acceptable solution, taking into account agreements reached during consultations with the supervisory board regarding the reduction of salaries and bonuses of the board members and achieving certification of the gas transmission operator until January 1, 2020 year, as well as increasing the level of natural gas production. On March 6, the Ukrainian government greenlighted a special resolution with the aim to appoint a new head to Naftogaz. The contract with Kobolev will expire on March 22 under a decision of the government in Kyiv. Over the past years, Kobolev has won a reputation as a reform-minded manager among Western donors for his attempts to reform the monopoly. Under his leadership,
Mark Rollins, the British CEO of Ukrnafta, the nation’s largest oil producer, is being let go after almost four years in the job. By terminating Rollins on April 30, Naftogaz asserts control of a company, where it controls 50% plus one share. During his tenure running Ukrnafta, Rollins turned the company into one of the top five taxpayers of the nation. But he ran afoul of Naftogaz over unpaid debts by the state oil and gas company. Responsible for two thirds of Ukraine’s oil production, Ukrnafta has 43 drilling rigs, 168 gas wells, 1,936 oil wells and 537 gas stations across Ukraine.
DTEK Naftogaz, one of the nation’s largest private gas producers, plans to nearly double natural gas production to 3bn cubic meters by 2024, Igor Shchurov, the company’s general director, said Wednesday at the Ukrainian Energy Forum in Kyiv. Praising regulatory changes and cuts in royalties, Shchurov said the company plans to double investment, to $110mn, and to increase drilling depths, possibly to below 7 km. Responsible for about one third of Ukraine’s privately produced gas, DTEK Naftogaz produced 1.65bn cubic meters last year, the same amount as in 2017.
9.2.3 Transport corporate news
Ukrzaliznytsia plans to spend $1.85bn through 2025 to buy 310 new locomotives , Alexander Bogdanov, deputy director of the state railroad’s locomotive department, said at a recent railway conference in Kyiv. The average Ukrzaliznytsia locomotive has used up 84% of its expected working life. By the end of this month, all 30 GE locomotives imported from the US
48 UKRAINE Country Report April 2019 www.intellinews.com