Page 7 - UKRRptOct22

“This is a violation by Gazprom of the principle of the transit agreement ‘take or pay’,” he said. “Today, Gazprom is obviously paying less than it should under the contract, without any legal grounds”.
Vitrenko also announced over the summer that a $12bn claim against Gazprom for potentially impairing gas deliveries, which Naftogaz dropped in 2019, will be reopened.
2.2 Naftogaz Group is increasing gas production western Ukraine
Naftogaz Group is increasing gas production western Ukraine with the use of new technologies and equipment. In particular, Lvivgasvydobuvannya Gas Production Division, one of three divisions of the JSC Ukrgasvydobuvannya and the operator of deposits in five western regions, has transferred 2% more natural gas to the transportation system y/y than in 2021.
Naftogaz CEO Yuriy Vitrenko spoke about these production increases during a working visit to one of gas deposits in Lviv region together with Maksym Kozytsky, head of the Lviv Military Administration.
According to Vitrenko, Ukraine’s energy security demands maximum self-sufficiency in the provision of energy sources. Even during the current wartime conditions, Naftogaz utilizes all available options to boost gas production.
“Last year we started to ramp up production values and had all the potential to maintain this trend during the current year. Due to military action our company has lost several wells. However, thanks to the efforts of our employees, production decreases are minimal at just two% year-to-date. In comparison, private companies experienced an 11% decline in reduction. In view of situation in our country, we are planning to intensify the development of deposits in western Ukraine, where productivity potential is quite high. The drilling of a deviating hole we observed today is one such project. Meanwhile, our Company resumes works on damaged or shuttered facilities in the east of the country. As our army wins back territory, next year we are planning to increase production volumes,” Vitrenko noted.
According to Vitrenko, every year Naftogaz increases capital investments in exploration and production to reach established targets. Next year, investments will rise by 15% upon approval of the Naftogaz Financial Plan by the government.
Stabilization and increases in domestic gas production are among the most important factors bringing Ukraine closer to energy independence and ensuring a smooth heating season in 2022-2023 for the country. In view of the war unleashed by Russia and unprecedentedly high price for gas in global markets, this season may become one of the most complicated periods in the entire history of independent Ukraine.
Maxym Kozytsky noted that innovations and investments made by Naftogaz are very important for the region. “Lviv region is well-known for its gas production activities. I’m very pleased to see that Naftogaz implements new
7 UKRAINE Country Report October 2022 www.intellinews.com