JKX Oil & Gas with assets in Ukraine and Russia in the nine months of 2019 reached an average daily production of 10,668 barrels of oil equivalent (boepd), which is 19% more than the average figure for the nine months of 2018.
According to the company’s report on the London Stock Exchange, production in Ukraine in January-September 2019 rose by 51% compared to January-September 2018, to 5,535 boepd, in particular that of gas by 55%, to 765,000 cubic meters per day, oil and condensate by 33%, to 1,033 boepd.
At the same time, the average gas price for the indicated period of 2019 in Ukraine decreased by 21% compared to the same period in 2018, to $226 per 1,000 cubic meters, oil by 15%, to $61 per barrel.
The company said that in the third quarter of this year, compared with the second quarter, the average daily production grew by 13%, to 11,719 boepd, including in Ukraine by 16%, to 6,217 boepd. In particular, the growth of gas production in Ukraine amounted to 14%, to 842,000 cubic meters per day, oil and condensate by 26%, to 1,260 boepd.
“This is the highest level of oil production for the quarter and since the beginning of the year for the period from 2013,” the report said.
The increase in oil production in the third quarter of 2019 is the result of drilling two new wells: NN81 and IG142, JKX said.
At the same time, gas prices continued to decline in the third quarter, to an average of $175 per 1,000 cubic meters compared with $215 per 1,000 cubic meters in the second quarter and $269 per 1,000 cubic meters in the first quarter.
JKX Oil & Gas is engaged in the exploration and production of hydrocarbons in Ukraine, the Russian Federation, Hungary, and Slovakia.
Ukrainian enterprises in January-September 2019 decreased exports of ferrous scrap metal by 86.9% compared to the same period of 2018, to 40,633 tonnes (307,922 tonnes in January-September 2018).
According to customs statistics released by the State Fiscal Service of Ukraine, exports of scrap metal in monetary terms fell by 88.8%, to $11.273 million ($100.290 million a year ago).
Some 3,551 tonnes of scrap metal was exported in September, 155,000 in August, 204,000 tonnes in July, 208,000 tonnes in June, 8,068 tonnes in May, 8,791 tonnes in April, 8,246 in March, 8,252 tonnes in February and 3,140 tonnes in January.
At the same time, in January-September 2019, the country increased imports of scrap metal in kind by 48% compared to January-September 2018, to 43,503 tonnes. Imports in monetary terms decreased 0.2%, to $26.521 million.
Imports of scrap metal for the mentioned period arrived mainly from Turkey (55.26% of deliveries in monetary terms), Russia (35.19%), and the Netherlands (2.51%); and major exports were shipped to Turkey (86.99%), the Netherlands (6.21%) and Germany (4.85%).
Ukrainian metal companies in January-September 2019 imported 1,462 tonnes of ferrous products obtained by direct reduction of iron ore (HS code 7203) – hot briquetted iron (HBI), which is a substitute for pig iron and scrap metal. The HBI was imported from Russia through July-August for a total value of $478,000 when 1,539 tonnes of HBI was imported through January-September 2018 with a total value of $509,000.
As reported, Ukrainian enterprises in 2018 decreased exports of ferrous scrap metal by 33% compared to 2017, to 327,547 tonnes. Exports of scrap metal in monetary terms fell by 13.3%, to $105.646 million.
The Cabinet of Ministers of Ukraine has earmarked UAH 70 million to buy equipment for issuing passports, driver’s licenses and registration of vehicles in the administrative service centers, Ukrainian Prime Minister Oleksiy Honcharuk said at a briefing on Wednesday.
“Today we took the first step towards the unification of the network of administrative service centers. It so happened that in the previous government many ministries tried to make themselves transparent offices, the administrative service center, each built its own infrastructure. This will not happen… We will optimize them. Today we approved the procedure for using funds for one of these networks – Administrative Service Centers, and the logic of the merger has already been laid in this procedure,” Honcharuk said.
The prime minister said that all these structures were created with one goal – to provide administrative services to the population – therefore, their unification is inevitable.
A bill on demonopolilzation of the spirit sector could be passed by the end of this year, according to newly appointed advisor to the Minister of Economic Development, Trade and Agriculture of Ukraine on a voluntary basis Serhiy Bleskun. “A project to demonopolize the alcohol industry starts on Friday during the roundtable. A law on demonopolization of the alcohol industry may be adopted by the end of the year. The bill has already been developed,” he said at a briefing in the Cabinet of Ministers on Wednesday.
According to Bleskun, the state receives UAH 4.6 billion annually from the alcohol industry.
“We ask buyers of alcohol how much time it will take to build a distillery. They say: one and a half or two years. If they are allowed today, then after one and a half or two years they will have their own alcohol to make private distilleries operate,” he said.
State-owned enterprise Ukrspyrt is a major producer of alcohol and alcohol-containing products in Ukraine. Until now, it was subordinate to the Ministry of Agricultural Policy and Food.
The total production capacity of the SOE is more than 36 million decalitres per year. It has 41 production sites.
Fifth President of Ukraine and current member of the Ukrainian parliament Petro Poroshenko does not want to cooperate with the State Bureau of Investigations (SBI) on the investigations into thirteen criminal proceedings in which he is a witness, SBI Director Roman Truba said. “Petro Poroshenko should understand that it is in his interests to testify so that the investigators can study the circumstances as soon as possible […] Unfortunately, the ex-president does not agree on that. We are offering cooperation, but he offers opposition. We are proposing to him an investigation into all circumstances of the case, he is engaging in politics near the SBI office,” Truba told a briefing in Kyiv on Wednesday.
A testimony is needed first and foremost for Poroshenko himself, Truba said.
The SBI is investigating 13 criminal proceedings in which Poroshenko is a witness and he is being questioned in that status, Truba said.
Philip Morris Ukraine, British American Tobacco, JTI and Imperial Tobacco in Ukraine are mulling the possibility of decreasing production and later closing the tobacco factories on the territory of Ukraine over the adoption of the legislative requirement on the government regulation of markup on their goods by the Verkhovna Rada.
“The fact of adoption of this bill will have serious consequences for the industry. This is the absence of a transition period and implementation mechanisms. In the near future, this will expose our business to risks. We will be forced to consider the issue of producing our goods at other factories, since we do not even fully understand how to execute this bill,” Director of British American Tobacco Ukraine Simon Welford said at a press conference at Interfax-Ukraine on Wednesday.
He said that bill 1049, passed at second reading, introducing a single account for paying taxes and duties, the single social security contribution, sets a fixed markup for wholesale and retail traders of tobacco products at 7% and 13% of the maximum retail price per package.
General Manager of Imperial Tobacco in Ukraine Rastislav Cernak said that these legislative initiatives could entail an increase in the volume of illegal trade in tobacco products from 8.4% to 20%. At the same time, he said that over the past three years, the volume of the “shadow” tobacco market has grown by about seven times and this annually cost UAH 5 billion the national budget.
At the same time, Cernak predicted a 25% reduction in cigarette production. “Such a 25% drop, according to our estimates, will cost the national budget about UAH 7 billion. Therefore, we urge the Verkhovna Rada to revise bill No. 1049 and remove the amendment that establishes the regulation of the markup. We request that transparent lawmaking in Ukraine along with an open dialogue with major investors start working, as such significant changes in taxation force us to rethink our business in Ukraine,” he said.
