Business news from Ukraine

UKRZALIZNYTSIA LAUNCHES TEST OF MUKACHEVO-BUDAPEST TRAIN ON EUROPEAN GAUGE

PJSC Ukrzaliznytsia on November 14, 2018 launched the Mukachevo-Budapest train on the European gauge in a test mode, Ukrainian Infrastructure Minister Volodymyr Omelyan has written on his Facebook page.
“We are planning to launch a regular communication in the near future… The next direction is to Slovakia, and also using the European gauge. This was recently agreed with the Slovak colleague,” the minister said.
According to him, with its convenient communication with many Ukrainian cities and EU countries, Mukachevo can become a major railway hub, and not just a passenger one.
As reported, in September, Ukrzaliznytsia postponed the launch of the Mukachevo-Budapest train until the end of 2018 and planned for 2019 the new Kyiv-Berlin train.

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UKRZALIZNYTSIA TO ELECTRIFY TRACK SECTION FROM KYIV TO BORYSPIL AIRPORT

PJSC Ukrzaliznytsia is holding talks about the electrification of the track section from Kyiv to the Boryspil International Airport, acting Board Chairman of Ukrzaliznytsia Yevhen Kravtsov said on the sidelines of the event devoted to the final stage of the selection of projects at Future of Mobility Lab.UZ edition on October 29.
According to him, in case of passenger traffic growth, the company plans to add a diesel train produced by Kriukov Car Building Works on the Central Railway Station – Boryspil Airport route.
“Depending on the demand in the project launch process, we are planning to increase the number of trains and cars of trains. We have an agreement with the KCBW [Kriukov Car Building Works] for the supply of diesel trains. Perhaps they will be exploited in this section in the future, if there is a demand,” he said.
According to Kravtsov, the project’s payback period is 9-10 years, and the planned load during the first year should be at least 80% of the capacity.
“Now we are coordinating the schedule, since after the launch of this express train, the section between Darnytsia and Boryspil will be one of the most stressful in Ukraine, especially considering the large number of passengers, including commuter traffic. We plan that in the first stages of launching the frequency in the peak hours will be about 30-40 minutes, in non-peak hours – 40 minutes or an hour and a half,” Kravtsov said.
He also said that now Ukrzaliznytsia is discussing the need for night trains with the airport – the need for such trips is being discussed, taking into account the small number of night flights from the airport.
The train will be launched by the end of November, but there is no exact date yet, since there are a number of remarks from Prime Minister Volodymyr Groysman, which should be taken into account, Kravtsov said.
He also said that negotiations are now being completed with the State Aviation Service of Ukraine and UkSATSE regarding the electrification of the section from Kyiv to Boryspil.
“As soon as this is done, it will simplify the issue of using various types of trains on this route,” he said.

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UKRZALIZNYTSIA TO LAUNCH EXPRESS TRAIN TO BORYSPIL AIRPORT

PJSC Ukrzaliznytsia in November 2018 will launch an express train to the Boryspil international airport (Kyiv region).
“In February was the project, in May – the start of works, and in October – a test launch of the train. In November it will be the launch of the express train,” Prime Minister of Ukraine Volodymyr Groysman said on his Twitter account on Thursday.
The prime minister said that the cost of the project was about UAH 580 million, recalling that the estimated cost of the “infamous Air Express” in 2010 amounted to UAH 3.2 billion.
Groysman also pointed out the convenience of creating a covered gallery between the airport terminal and express platform.
As reported, Transportation on the Kyiv city-the Boryspil international airport route could reach 3.8 million passengers in 2019, according to Ukrzaliznytsia. The company expects that with a ticket price of UAH 80 the payback period for the project will near 10 years. Ukrzaliznytsia does not deny the scenario of increasing the cost of travel, depending on the demand for the service, as well as the factors that negatively affect its production cost for the company.
The estimated travel time will be 35-40 minutes.

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UKRAINIAN GRAIN FARMERS CANNOT TIMELY EXECUTE CONTRACTS FOR EXPORTS DUE TO LACK OF UKRZALIZNYTSIA’S LOCOMOTIVES

Ukrainian grain farmers cannot timely execute contracts for exports of products due to a shortage of locomotives at Ukrzaliznytsia, the Ukrainian Agribusiness Club has reported. “The main problem of PJSC Ukrzaliznytsia, which impedes the efficient transportation of grain, is a shortage of locomotives. Due to a lack of traction, wagons stand idle at stations and elevators, while the turnover of cars of Ukrzaliznytsia’s Transport Logistics Center has increased from five to 11 days over the last two years, private to 13 days,” the report says.
According to the association, delays in the transportation of grain crops lead to a breach of export contracts, while transportation rates are declining, and gross production is rising. According to the union, only 500 out of 2,500 Ukrzaliznytsia locomotives work, while the overhauls of many of them were carried out in the 1990s.
At the same time, the association noted an increase in the number of grain wagons in the country: about 11,500 cars are owned by Ukrzaliznytsia, about 10,000 are private.
According to the Ukrainian Agribusiness Club, it’s not worth expecting a speedy improvement in the situation with rail transportation because of a lack of funds at Ukrzaliznytsia for the purchase of locomotives in the near future.

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UKRZALIZNYTSIA TO START ELECTRIFICATION OF DOLYNSKA-MYKOLAIV-KOLOSIVKA RAIL SECTION IN MARCH 2019

PJSC Ukrzaliznytsia plans to start works to electrify the Dolynska-Mykolaiv-Kolosivka rail section in March 2019.
The company said that the ratification of the financial agreement between Ukraine and the European Investment Bank (EIB) under the Ukraine Railway Modernization Project by the Verkhovna Rada would allow launching an open tender to select a general contractor to electrify the Dolynska-Mykolaiv-Kolosivka rail section.
The company expects to use the first tranche at the end of May 2019. The minimum size of the tranche is EUR 5 million, and the total number of tranches will be up to 20, acting Board Chairman of Ukrzaliznytsia Yevhen Kravtsov said.
The project provides for two phases of implementation: work on the Dolynska-Mykolaiv section (the operational length is 148 km) is scheduled from March 2019 to May 2023, and on the Mykolaiv-Kolosivka section (105 km) from June 2019 to October 2021.
As reported, the Verkhovna Rada has ratified a financial agreement (Ukraine Railway Modernization Project) between Ukraine and the EIB on the provision of a EUR 150 million loan to Ukraine, foreseeing funding of the modernization and expansion of the Dolynska-Mykolaiv-Kolosivka railway section.
In January 2018, the Cabinet of Ministers of Ukraine approved the project on the reconstruction of the Dolynska-Mykolaiv railway section with increased capacity of the Znamianka-Dolynska-Mykolaiv section.
On December 19, 2016 a financial agreement on the Ukraine Railway Modernization Project (modernization of the infrastructure of PJSC Ukrzaliznytsia) was signed with the EIB, which provides for a loan of EUR 150 million.

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STATE-OWNED UKRZALIZNYTSIA INVESTS UAH 8.5 BLN IN FIXED ASSETS DEVELOPMENT IN JAN-AUG 2018

Ukrzaliznytsia has repaired and reconstructed 351 km of track from the planned 1,935 km this year, the company’s press service has reported. In January-August 2018, the company reconstructed almost 184 km of track and overhauled more than 167 km, replaced 106 railroad switches for new sets. In September it is planned to reconstruct 36.1 km of track, overhaul 34 km of track, repair 118.6 km, and renew 55.4 km of track on various directions.
In general, it is planned in 2018 to repair 1,935 km of track and 1,317 sets of railroad switches. “Without an economically fair tariff, there will remain a maximum of 5,000 km out of 20,000 km of track in Ukrzaliznytsia in 10-15 years,” director for economics and finance at Ukrzaliznytsia Andriy Riazantsev said.
In the eight months of 2018, Ukrzaliznytsia invested almost UAH 8.5 billion in the development of its fixed assets, in particular, in modernization of infrastructure, the acquisition and repair of rolling stock.

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