Business news from Ukraine

DTEK OIL & GAS INCREASES GAS PRODUCTION IN JAN-JULY

DTEK Naftogaz produced more than 1.1 billion cubic meters of gas in January-July, which is more than 10% more year-over-year, the company said in a press release on Friday.
“The increase in production was made possible due to the implementation of the drilling program in 2020, as well as the completion of drilling of two wells in 2021,” the company said.
In addition, DTEK Naftogaz in 2021 carried out overhaul and stimulation operations, as well as process operations at more than 20 wells of the operating stock, the company said.
“A number of technologies that were applied at the same time were used by the company for the first time in Ukraine. DTEK’s oil and gas business remains a technological leader and a driver for the development of the oil and gas industry in Ukraine,” DTEK Oil & Gas said.
According to the company, by the end of 2021 it is planned to complete the drilling of two more wells and put into operation a modular refrigeration unit at Machukhske field. This will allow reaching a new record production rate in 2021 of 2 billion cubic meters of gas.
“Due to sustainable process development and systemic investments, we ensure the growth of gas production from year to year […]. The use of fiscal stimulating instruments by the government, as well as a stable and transparent regulatory environment, are extremely important for the further effective development of the industry,” CEO of DTEK Oil & Gas Ihor Schurov said in the press release.
By the end of 2020, DTEK Naftogaz increased natural gas production by 10.8% (by 180,000 million cubic meters) compared to 2019, to 1.84 billion cubic meters.

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UKRAINIAN NAFTOGAZ HAS INVESTED $580 MLN IN OIL AND GAS SECTOR OF EGYPT OVER 15 YEARS

Over 15 years, NJSC Naftogaz Ukrainy has invested about $580 million in the production of concessional oil and gas fields of hydrocarbons in Egypt, said First Deputy Chairman of the Board of the company Serhiy Pereloma.
“We plan to develop this area in the future and, accordingly, to increase the volume of hydrocarbon production,” he wrote on his Facebook page following a meeting with Ambassador of the Republic Ayman Elgammal.
According to him, the joint company of the NJSC and the Egyptian General Petroleum Corporation (EGPC) – Petrosannan Company – were able to significantly increase the production of hydrocarbons in the Alam El Shawish East Western Desert this year. In particular, work has begun to increase hydrocarbon recovery by flooding an oil reservoir of one of the main fields, an intensive well workover campaign has been carried out, and significant results have been achieved during hydraulic fracturing operations.
“We plan to expand this successful experience. We are looking for ways not only to increase oil and gas production, but also new opportunities for their further transportation,” Pereloma said.
He also said that the Petrosannan Company has provided the Egyptian Coptic Church in Asyut governorate with geological data that will help drill new wells to supply the farms with fresh water.

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UKRGAZVYDOBUVANNIA REDUCES GAS PRODUCTION

Ukrgazvydobuvannia in January-July 2021 reduced gross production of natural gas by 5.2% (by 437 million cubic meters) compared to the same period in 2020, to 7.932 billion cubic meters, the press service of the company said.
According to its data, gross production for the seven months decreased by 5.1% (by 406 million cubic meters) compared to January-July 2020, to 7.493 billion cubic meters.
Underfulfillment of the production plan is 125 million cubic meters and 51 million cubic meters respectively
In July 2021, gross gas production decreased by 4.8% (by 57.5 million cubic meters) compared to July 2020, to 1.144 billion cubic meters, marketable – by 4.5% (by 50.8 million cubic meters), to 1.088 billion cubic meters.
To stabilize production indicators during January-July 2021, the company commissioned 25 new wells, carried out 80 well workovers, performed 321 coiled tubing operations, 71 hydraulic fracturing operations, carried out nine sidetracking operations, equipped a remote monitoring system for 197 high-production wells.
As reported, Ukrgazvydobuvannia, 100% of which belongs to NJSC Naftogaz Ukrainy, in 2020 reduced production of marketable gas by 1.2% (by 170 million cubic meters) compared to 2019, to 13.45 billion cubic meters, and the company’s gross production amounted to 14.23 billion cubic meters.

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GAS TRANSIT THROUGH UKRAINE’S GTS DECREASES BY 14%

Transit of natural gas through the gas transmission system (GTS) of Ukraine in January-July 2021 amounted to 25.616 billion cubic meters, which is 14.1% less than in the same period in 2020 (29.82 billion cubic meters), according to the data of Gas Transmission System Operator of Ukraine (GTSOU).
In particular, in January, transit amounted to 3.863 billion cubic meters (124.6 million cubic meters per day), in February – 2.907 billion cubic meters (103.8 million cubic meters per day), in March – 3.694 billion cubic meters (119.2 million cubic meters per day), in April – 3.718 billion cubic meters (123.9 million cubic meters per day), in May – 3.86 billion cubic meters (124.5 million cubic meters per day), in June – 3.723 billion cubic meters (124.1 million cubic meters per day), in July – 3.851 billion cubic meters (124.2 million cubic meters per day).
According to the press service of the company, in particular, 23.3 billion cubic meters of gas were transported by transit in the western directions (Slovakia – 15.8 billion cubic meters, Hungary – 5.3 billion cubic meters, Poland – 2.2 billion cubic meters), in the south – 2.3 billion cubic meters (Moldova – 1.9 billion cubic meters, Romania – 400 million cubic meters).
GTSOU notes that in July Gazprom used all previously booked capacities, but showed no interest in additional transit capacities, despite the record growth in prices in European gas markets, as well as low volumes in European storage facilities and the planned stop of Yamal-Europe routes and Nord Stream 1.
According to GTSOU Director General Serhiy Makogon, Gazprom is emptying its UGS facilities in Europe in order to compensate Europeans for the lost gas volumes, and at the same time not to increase additional transit through Ukraine.

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NATIONAL SECURITY AND DEFENSE COUNCIL: UKRAINE LOSES 17,000 KM OF GAS DISTRIBUTION NETWORKS

Ukraine has recently lost about 17,000 gas distribution networks that have groundlessly ended up in private ownership, National Security and Defense Council (NSDC) Secretary Oleksiy Danilov said.
“Unfortunately, we must say that recently, in some amazing way, the government has lost 16,920 kilometers of networks, which have passed into private ownership. We see no reason today not to deal with this issue and intend to find out how this happened,” he said at a briefing on the results of the NSDC meeting in Kramatorsk on Friday, July 30.
At the same time, he said the gas distribution market segment is distinguished by the monopoly position of one group of companies owned by businessman Dmytro Firtash, due to which the NSDC will instruct the Cabinet of Ministers to check their activities.
“One of the companies owns 70% of regional gas companies. This directly concerns Mr. Firtash, against whom personal sanctions have been imposed. We will also deal with this issue. By the decision of the NSDC, we will instruct the Cabinet of Ministers to check all these things in order to bring them into line with the current legislation. We will not allow someone as a state to blackmail us and distort bills,” Danilov said.

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STATE SERVICE OF GEOLOGY OF UKRAINE PUT UP FOR AUCTION 5 OIL AND GAS AREAS

The State Service of Geology and Subsoil of Ukraine has put up for electronic auction five hydrocarbon sites with a total starting cost of UAH 207.8 million (excluding the cost of geological documentation), the authority has said.
At the auction on October 20, 2021, in particular, Pivdenno-Rusanivska area (Sumy and Poltava regions) was put up for UAH 92.5 million (hereinafter without VAT), Zhukivska area (Poltava region) – for UAH 5.306 million, the Kitvan area (Ivano-Frankivsk region) – for UAH 1.925 million, Reshetylivska area (Poltava region) – for UAH 2.229 million and Tynivske area for UAH 107.847 million.
As reported, following the results of electronic trading in 2020, the State Service of Geology and Subsoil attracted UAH 826 million of direct revenues to the state budget. In 2021, a plan was announced to receive at least UAH 750 million.

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