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    New Naftogaz CEO to raise output, lower prices


Affordable energy security is back on the agenda for Kiev

by: William Powell

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Natural Gas & LNG News, Europe, Security of Supply, Corporate, Corporate governance, Exploration & Production, Import/Export, News By Country, Ukraine

New Naftogaz CEO to raise output, lower prices

Ukraine's gas production must rise and prices for consumers must fall, the new head of Naftogaz Ukrainy, Yuriy Vitrenko, told journalists at a press conference April 30. He said the failure of upstream subsdiary Ukrgazvydobuvannya to meet the target was one of the reasons for high gas prices for the population.

The company had been expected some years ago to produce 20bn m³/yr by 2020 and make the country self-sufficient, although it is actually seeing production falling, he said. A government commission will examine the reasons for this, he said, in collaboration with the newly established supervisory board. He said the greater transparency he would bring to the company would help raise the overall efficiency of the company.

He also said that the company would do all it could, using all the legal measures available to it, to limit Gazprom's ability to dominate central and eastern gas markets, and also to block capacity on the Russia-Ukraine border. It will also try to stop Gazprom from blocking gas from central Asia from reaching Ukraine and Europe. More transit would equate to higher state revenues as well as lower prices, he said. "There are very specific things we can do to limit the gas price rises," he said.

The state gas companies of Poland and Romania, which he said were analogous to Naftogaz. were profitable last year despite the challenges and they paid dividends to the government that were needed to support the population. "We should be able to do the same ourselves," he said.