Naftogaz Offers Producers Higher Price
Ukraine's state gas group Naftogaz said June 25 it intends to raise its purchase price for natural gas bought from producers in the country to $8/mn Btu in July. It is also modernising its network.
Naftogaz offered 6900 hryvnia per '000 m3 ($7.24/mn Btu) to domestic gas producers in June but got no takers - despite June being the seasonal low, both for gas prices and demand. So it has now raised its offer: the July price is 7629 hryvnia per '000 m3 ($8/mn Btu) excluding value added tax (VAT). It previously approved a purchase price rise on March 22 2017 to hryvnia 4,942 per '000 m3 excluding VAT.
Ukraine produced 20.5bn m3 gas in 2017, only 2% more than the previous year, which accounted for 64.2% of total consumption. The rest of volume was imported from European states as Ukraine halted Russian gas purchases in 2015; then Gazprom declined to resume sales to its neighbour in February 2018 when requested by Naftogaz.
Credit: Naftogaz
Ukraine’s gas transition system operator Ukrtransgaz (owned by Naftogaz) announced a tender June 26 expected to be worth hryvnia 2.5bn ($96mn) to upgrade its Yagotyn compressor station. This ensures supply from two domestic gas fields, Shebelinkagasvidobuvannya and Poltavagasvidobuvannya, as well as enabling gas to be pumped into the underground gas storage facilities (UGS). The station compresses gas for onward transportation by three main gas pipelines that terminate in the capital Kiev: two from Shebelinka (one via Dykanka, the other via Poltava) and the third from Efremivka (via Dykanka).
Completion of the procurement procedure and signing of the agreement with the winner in the bidding is planned to end by October. Both Ukrainian and foreign companies can participate in the tender.
Ukrtransgaz adopted a ten-year plan May 8 to modernise the country’s gas transportation system (GTS) along with four compressor stations including Yagotin. By 2021, the company plans to build a new compressor service department with four gas-pumping units powered by gas turbine engines with a capacity of 14-16 MW each and the necessary engineering infrastructure to transport about 50mn m3/d.