Ukraine would receive income of $15 billion in five years of transit of Russian natural gas, according to Minister of Energy and Environment Protection of Ukraine Oleksiy Orzhel. “The approximate income with which Ukraine left this meeting [the meeting in Minsk on December 20, following which Ukraine-Russia-EC signed an intergovernmental protocol], is more than $3 billion for arbitration and approximately $3 billion for transit each year during five years,” the minister wrote in his column for the Ekonomichna Pravda (Economic Truth) publication on Tuesday.
“Thus, in five-year outlook, we will receive about $18 billion, of which $3 billion is ‘natural’ money – before the New Year. And this is without any enslaving conditions regarding the purchase of Russian gas,” Orzhel said.
At the same time, he said that at the meeting in Minsk the parties made significant progress, however, at present, the risk of not signing the new contract still exists.
“The protocol is not an agreement yet. In the last week of December, our companies will draft the text. But until the agreement itself has been signed, there is no transit. Can the other side change its mind at the last moment? Yes. Are we ready for this? Yes. But if this happens, Gazprom will suffer all image losses,” the minister added.
Ukraine in January-June 2019 imported 4.863 billion cubic meters of natural gas for a total of $1.060 billion, in particular in June 1.372 billion cubic meters for $259.638 million, according to the State Statistics Service.
Thus, the average price of gas imported by the country in June 2019 amounted to $189.3 per 1,000 cubic meters, which is 7.8% less than in May 2019 ($205.3).
The counterparties for the six months of 2019 were companies from Switzerland with 1.732 billion cubic meters of gas for $372.82 million, Germany with 1.567 billion cubic meters for $329.671 million, Hungary with 356.061 million cubic meters for $72.895 million, the Czech Republic with 246.071 million cubic meters for $51.799 million, Poland with 292.817 million cubic meters for $63.78 million, Austria with 224.315 million cubic meters for $63.597 million, France with 172.724 million cubic meters for $38.518 million, the UK with 106.64 million cubic meters for $28.751 million, Luxembourg with 88.627 million cubic meters for $23.159 million, Slovakia with 57.583 million cubic meters for $11.23 million, Italy with 16.893 million cubic meters for $3.487 million, and Bulgaria with 1.4 million cubic meters for $255,000.
Gas was not imported from Russia for the indicated period.
Smart Energy group, following the results of drilling and overhaul projects, has reached the daily production of natural gas in the amount of one million cubic meters (mcm), the press service of the group has said.
Among the successful well overhaul projects, Smart Energy noted the decommissioning of well No. 1 in Ostroverkhivske gas condensate field (Kharkiv region), located in the license area of Ukrgazvydobuvannia.
As reported, in 2019 the group plans to invest about UAH 1 billion in the increase of natural gas production.
Earlier, in January 2019, the group announced that it had reached a historic daily maximum of 960,000 cubic meters of gas.
Smart Energy is a management company that is part of Vadim Novinsky’s Smart-Holding. It is engaged in the implementation of projects in the field of hydrocarbon production and alternative energy.
The National Commission on Securities and the Stock Market has signed a memorandum of cooperation with the European Federation of Energy Traders (EFET) on the development of commodity markets for energy products and financial instruments markets, on which energy products are the basic asset.
According to a press release of the commission, the parties will cooperate in developing new securities and bankruptcy legislation that will provide the netting of commodity derivatives and the effective protection of netting in operations with such products such as natural gas, electricity and the like.
“Now energy companies and producers operating in the Ukrainian market do not benefit from liquidation netting when implementing agreements and must make prepayment for the supply of gas when dealing with counterparties with the EU. This situation does not contribute to the creation of a highly liquid energy market in Ukraine similar to the markets of the EU countries. Therefore there is the need to improve the domestic legislative framework and implement relevant EU directives,” the press release noted.
According to the commission, the norms on the introduction of liquidation net settlement of derivatives are already contained in draft law No. 7055 on capital markets and regulated markets.
EFET unites European energy traders working in wholesale electricity and natural gas markets. The federation was founded in 1999 in response to the liberalization of European electricity and gas markets.