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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UKRNAFTA POSTS NET PROFIT OF UAH 1.585 BLN IN H1

PJSC Ukrnafta in January-June 2021 saw a net profit of UAH 1.585 billion versus UAH 2.596 billion of a net loss for the same period in 2020.
According to the company’s statement in the information disclosure system of the National Securities and Stock Market Commission, its net income in the first half of the year increased 1.5 times (by UAH 5.069 billion), to UAH 15.042 billion, gross profit – 3.3 times (by UAH 4.608 billion 607.785 million), to UAH 6.571 billion.
Ukrnafta is the largest oil company in the country. NJSC Naftogaz Ukrainy owns 50% + 1 share in Ukrnafta, a group of companies associated with the former shareholders of PrivatBank – about 42% of shares. Ukrnafta has 25 drilling rigs, 1,891 oil and 162 gas well. The company owns 537 filling stations.

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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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UKRTRANSNAFTA IN JUNE FOR FIRST TIME TRANSPORTS ALGERIAN CRUDE OIL

JSC Ukrtransnafta in June for the first time transported Algerian Saharan Blend crude oil, the press service of the company has reported
“After checking the quality indicators of crude oil, the company began accepting it into the oil transmission system for further transportation to the facilities of the Kremenchuk oil refinery. Algerian oil will be transported through the Odesa-Kremenchuk pipeline,” the press service said.
The press service recalled that in addition to pumping oil from Ukrainian fields, UTN now already has experience in transporting six grades of imported oil: Urals, Azeri Light, Bakken (since July 2019), El Sharara (since November 2019), WTI (since June 2020) and Saharan Blend.

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UKRAINIAN STATE READY TO ACT AS CO-INVESTOR IN OIL REFINERY

Ukraine is negotiating with investors and is ready to act as their partner in an oil refinery project, but it needs guarantees for the supply of oil regardless of the political situation, Deputy Head of the President’s Office of Ukraine Kyrylo Tymoshenko has stated.
“We have an idea for our own oil refinery … This is a big investment. We spoke with several investors, but the state is also ready to invest in such an enterprise. At the same time, we need to understand how we will get oil so as not to depend on any political situations,” Tymoshenko said in an interview with Interfax-Ukraine.
According to him, in particular, the presence of an oil refinery will fully guarantee the supply of bitumen for the Big Construction project.
Tymoshenko stated that today, due to cheaper logistics in the volume of bitumen imports to Ukraine, Belarus is the leader.
“There is also Ukrainian bitumen – Kremenchuk [oil refinery], but its volumes are not enough, although the plant is operating at full capacity. In addition, there are quality issues related to the oil used, but in principle it is now at the level,” Tymoshenko said.
He noted that, in addition to Belarusian bitumen, Ukraine imports Greek, Italian and from other countries. The scheme for the supply of bitumen by tankers was worked out last year, when there were traffic jams on the border with Belarus.
“We do not think that Belarus will stop supplying bitumen to us, because we are a really large customer … If Belarus refuses to supply bitumen to Ukraine, then its suppliers, according to our information, have booked quotas in other countries. There will be no problems with this,” he said.
Tymoshenko also said that within the framework of the Big Construction project, Ukraine is ready to build new oil and gas terminals on the Black Sea, there are preliminary agreements after the visit of the President of Ukraine to Qatar.
At present, the state, through NJSC Naftogaz Ukrainy, owns 51% in Ukrnafta, the largest oil company, which in 2020 reduced oil and condensate production by 1%, to 1.5 million tonnes. Another 42% are controlled by the ex-owners of PrivatBank. Oil and condensate production by Naftogaz Group decreased to 1.95 million tonnes from 2 million tonnes a year earlier, while in Ukraine as a whole – to 2.4 million tonnes from 2.43 million tonnes in 2019.

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