Page 78 - UKRRptSept21

9.2 Major corporate news 9.2.1 Oil & gas corporate news
Ukraine’s gas pipeline operator earned $1 billion in the first half of this year, largely by pumping Russian gas to Europe. Profits were $208 million, reports the Gas Transmission System Operator of Ukraine. Profits were recorded despite $371 million in unpaid debts by domestic gas distributors. About 80% of this debt is owed by Regional Gas Company, owned by Dmytro Firtash, calculates Ukrainska Pravda. The Operator cannot shut off gas to Firtash’s company as it would shut off gas to most of Ukraine’s households. Threatening this situation, Gazprom’s contract with the Operator ends in 2024.
Ukraine’s has 17.6bn cubic meters of gas in underground storage – enough for the winter, but 30% less than this time last year, Ukrtransgaz reported yesterday. Last Oct. 28, when the storage facilities switches to transmission mode, reserves totalled 28bn cubic meters. With prices high, Ukraine has slowed purchases.
Poland’s PGNiG invests in gas exploration in Ukraine. The Polish state-owned oil and gas company has signed an agreement with the Ukrainian-American Energy Resources of Ukraine (ERU) on joint exploration of gas in Ukraine. The Polish company is purchasing a controlling stake( 85%) in Karpatgazvydobuvannia, the sole holder of a license to extract gas at Biblivska Oil and Gas Square in western Ukraine, in the area adjacent to the border with Poland. Drilling will begin in the second half of 2022 with further testing planned. If positive results are achieved, the well will be connected to the Ukrainian gas grid and put into operation in 2023. Last year, PGNiG sold 1.2bn cubic meters of gas to Ukraine, and another 210mn cubic meters in the first quarter of 2021.
Naftogaz CEO considers transit as a key source of funding for the transformation of the energy sector. "Ukraine receives quite a lot of revenue from gas transit. We have a contract until 2024 that provides Ukraine with guaranteed income of $7.2 billion. If transit is prolonged, for example, for another 10 years after 2024, this can guarantee Ukraine an additional $20 billion. This is a significant source of financing for Ukraine’s "green transition," Vitrenko said.
Naftogaz’s CEO emphasizes Ukraine’s openness to supporting the involvement of international partners in the gas transmission system operator. "We are ready to explore a consortium with European companies or American companies which would take on the role of operator. This is an idea that is attractive enough for Ukraine as well as potential European and American partners. But the prerequisite for such a consortium is the booking of Ukraine's GTS capacities by European companies," Vitrenko explains.
Naftogaz has invested about $580mn in the production of concession oil and gas in Egypt over the last 15 years, Serhiy Pereloma, the company's first deputy board chairman, writes on Facebook. In a joint venture with Egyptian General Petroleum Corporation, Naftogaz has been exploring and producting in Egypt’s southern, eastern and western deserts. Last year, Egypt accounted for only $7mn of Naftogaz revenues.
78 UKRAINE Country Report September 2021 www.intellinews.com