Energy

Tuesday, August 17

Seeking to attract foreign investment in the gas sector, Naftogaz will host the Ukraine Gas Investment Congress in Kyiv Oct. 20 to 22. “With the second largest gas reserves on the continent, Ukraine has the single largest growth opportunity in natural gas production in the EU,” says Naftogaz CEO Yuriy Vitrenko. Ukraine has set a targ...

Naftogaz needs $20 billion in investment over this decade to develop gas fields in the Black Sea and deep gas fields on land, Ukraine’s state oil and gas company reports. Naftogaz production has been slowly declining hitting 14 billion cubic meters last year. During the first half of this year, Naftogaz production unit, UGV,...

Replacing natural gas with hydrogen in Ukraine pipeline transmission system could take 40 years, Olha Belkova, foreign relations director for Ukraine pipeline Operator, writes in NV. For starters, moving pure hydrogen is dangerous. Germany mandates a pipeline mix of 10% hydrogen and 90% natural g...

To create hydrogen production, transportation and storage infrastructure will require $11 trillion in investments by 2050 , Belkova writes, citing Bloomberg. With hydrogen accounting for 0.002% of total energy consumption, hydrogen can only account for 24% by 2050, she writes, citing Bloomberg. Belkova concludes: “It is ...

Friday, August 13

Denting German and Ukrainian dreams of replacing Russian natural gas in Ukraine’s main pipeline with hydrogen, a New York Times story warned last night that hydrogen “may, in fact, be worse for the climate than previously thought.” Drawing on a study in the Energy Science & Engineering journal by Cornell a...

Ukraine’s iron ore exports are down 3.5% this year by volume, but revenues are double – to $4.7 billion, reports the State Customs Service. Of the 26 million tons exported through July, China took 46%, the Czech Republic took 9.5%, and Austria took 8%.

Monday, August 9

A powerful explosion followed by a day-long fire at a Gazprom plant in Western Siberia cut Russian gas deliveries to Germany in half on Friday. EU gas prices spiked. The explosion cut gas deliveries across Poland through the Yamal pipeline. Deliveries across Ukraine are expected to drop today. But deliveries through Nord Stream 1 to Germany c...

Due to “catastrophic” damage, “production of gas, gas condensate and partly oil in the eastern part of the Yamalo-Nenets Autonomous Okrug is completely stopped,” a plant employee told Lenta.ru agency. The damaged plant is the larg...

In 2019, the plant produced 100 billion cubic meters of gas, the equivalent of half of Gazprom’s annual gas exports to Europe. Over the weekend, energy analysts struggled to gauge the impact of the fire. Prices in Amsterdam rose sharply, hitting $540 per thousand cubic meters. Over the last two weeks, EU gas prices have risen...

The plant that blew up was built in the 1980s and was scheduled for replacement. Instead of repairing the facility, Gazprom is expected to build a new one. Although the blast was felt 20 km away and the fire burned for 21 hours, no one was killed.

In July, Gazprom cut its pipeline deliveries to the EU by 10.3 billion cubic meters due to scheduled shutdowns of the Nord Stream 1 and Yamal pipelines for planned maintenance. Rather than make up for this shortfall by sending more gas across Ukraine, Gazprom chose to draw down its G...

“Gazprom is devastating its underground storage facilities in Europe,” Makogon told Ukraine pipeline operator’s press service. He said Gazprom-owned reservoirs in Germany are only 13% full, compared to a national average of 63%. Similarly, in Austria, Gazprom’s reservoir...

Friday, August 6

A Ukraine court ruled that a titanium and magnesium plant 49% owned by oligarch Dmytro Firtash should return to full state ownership , the State Property Fund reports. According to the Fund, the mine was partly sold to Firtash on the condition that he spend $110 million to modernize the complex, Ukraine’s only producer of titanium ...

Now the complex is being prepared for re-privatization. “[Zaporizhzhia Titanium and Magnesium Plant] will soon regain the status of a pearl of Ukrainian metallurgy,” Dmytro Sennychenko, chairman of the Property Fund. “In the future we will be able to attra...

Thursday, August 5

Tightening the natural gas shortage in the EU, Gazprom has cut by 50% gas shipments through the Yamal pipeline to Poland and stopped pumping gas into underground storage facilities in Austria, Germany and the Netherlands . With EU storage at only 57.5% of normal mid-summer levels, unfulfilled demand for gas is 16 billion cubic meters, Interfax reports from Moscow, citing data of the Gas Infrastructure Europe portal.

Prices on the European gas market hit $517 per 1,000 cubic meters on Monday . This is three times the level of $170 that Gazprom used in January to calculate its 2021 budget. Energy analysts say that Gazprom is forcing up the EU gas price to pressure regulators to commission ...

Ukraine’s gas pipeline operator earned $1 billion in the first half of this year, largely by pumping Russian gas to Europe. Profits were $208 million, reports the Gas Transmission System Operator of Ukraine. Profits were recorded despite $371 million in unpaid debts by domestic gas distributors. About 80% of this debt is o...

Automobile liquefied gas prices increased by 11% over the last month, hitting their highest level in recent memory , reports Enkorr.ua. The average prices has crossed the psychological barrier of UAH 17 per liter. Behind the increase are: delays in shipments by Rosneft, a 32% cut in shipments by Lukoil and sanctio...

Tuesday, August 3

“Germany Sees No Commitment to Shut Off Russian Gas in Biden Deal,” headlines a Bloomberg story reported in Berlin and based on background interviews with German officials. “Germany has little intention of shutting off Nord Stream 2 if Vladimir Putin tries to use the ...

The chairman of the US Senate Foreign Relations Committee joined counterparts from European parliaments, opposing the US-Germany agreement to allow completion of the Nord Stream 2 undersea gas pipeline. “We consider Nord Stream 2 a geopolitical project geared towards expanding Russia’s influence on Europe by dominating the energy market,...

With Nord Stream 2 99% complete, Ukraine’s goal is to make sure that gas never flows through it, Yuriy Vitrenko, chairman of Naftogaz, told RFE/RL on Saturday. “The battle is lost, but the war isn’t,” he vowed. “And our ‘war’ against Nord Stream 2 continues.” Gazprom owns the pipeline and t...

“US-German gas deal is a disservice to Ukraine,” headlines an editorial in London’s Financial Times. “Russian threat to Europe’s security cannot be ‘parked’ to focus on China.” Editors at the business newspaper write: “Nord Stream has always been at...

Naftogaz now has 17 billion cubic meters of gas in storage, the legal minimum for the start of the heating season , Naftogaz reported yesterday. With gas prices high, Ukraine’s 11 underground gas storage facilities are only 55% full. Last year, when gas prices were far lower, storage peaked at 92% of capacity.

Due to this summer’s spike in natural gas prices, Ukraine’s energy imports were up 76% yoy in July, Alfa-Bank Ukraine reported yesterday. The energy import bill topped $1 billion for the month.

Monday, August 2

Russia’s gas exports to the EU during the first half of this year were the same as January-June 2020 – 67 billion cubic meters. But over the same time, Gazprom’s exports to China, Finland and Turkey have tripled – to 33 bcm, reports Ukrinform, citing data from the Gas Transmission System Operator of ...

“The gas shortage in Europe’s underground storage facilities is largely artificial,” the pipeline operator tells Ukraine’s state news agency. Analysts say Gazrpom is driving up EU prices to justify opening Nord Stream 2 this fall.

The US House of Representatives approved an appropriations bill last week that mandates sanctions against Russia’s Nord Stream 2 gas pipeline , Ukraine’s Embassy in Washington posts on Facebook. The bill allocates $481.5 million in aid to Ukraine, a 6% increase over last year. The Senate is seen as hostile to the Russia-Germany Baltic Sea g...

Friday, July 30

EU gas prices have spiked to historic highs, increasing 10-fold on the Dutch TTF in the last 15 months, said Serhiy Makogon, the Director General GTS Ukraine Operator, wrote yesterday on Facebook. “Today at the European hub TTF, the price of gas with delivery next month crossed the border of 40 euros pe...

High gas prices in Asia – a 20% premium over EU — are causing diversion of LNG cargoes away from EU to Asia, according to S&P Global Platts. LNG deliveries to EU terminals in July were down by almost one third compared to the pre-pandemic year of 2019. For Europe, LNG is the main alternative to Russian p...

This summer’s high gas prices will mean increases of 15-70% in winter heating bills for Ukrainians , forecasts Ukrteplokommunenergo, the heating supply industry association. “If the price of gas continues to rise…we can predict growth [of bills] by 15-70%, depending on the region, city, local commu...

Thursday, July 29

With a 50-50 party split in the Senate, President Biden would have to risk a floor vote in the Senate, a chamber where many Democrats oppose Nord Stream 2. Biden has invited President Zelenskiy to visit Washington on Aug. 30, a day when Congress is not be in session. In September 2014, then-President P...

Wednesday, July 28

With European gas prices at 13-year highs, Gazprom declined an opportunity yesterday to increase its shipments across Ukraine in August by 50% , reports the Gas Transmission System Operator of Ukraine. Currently, Russia’s gas export monopoly company is shipping 124 million cubic meters a day across Ukraine. Yesterday, Ukraine offered additio...

Escalating the war between new Naftogaz CEO Yuriy Vitrenko and the company’s management, Vitrenko charges that a reported net profit of nearly half a billion dollars for the first quarter was in reality a loss of up to $4 billion. On May 5, Peter van Driel, Naftogaz CFO posted on Facebook...

Vitrenko blamed “the desire of management to talk about profits and show a supposedly good result in order to get a bonus as soon as possible, and postpone the reflection of losses until later.” He also says Naftogaz’ failed production program of the last three years has forced the oil and gas company to pay $2 billion to buy gas this summer...

DTEK Oil & Gas, Ukraine’s largest private producer, increased its gas production by 10% during the first half, compared to January-June of last year, the company reports. “DTEK Oil & Gas is steadily increasing gas production thanks to systemic investments and the introduction of innovative technologies,” s...

By the end of this year, the government plans to sell all its shares in Centrenergo, the state-owned energy company, the State Property Fund announced Monday. A rolling series of auctions will commence on August 2. The state owns 78% of Centrenergo. The Fund has reported that the sale might net $14 million. The Fund...

Tuesday, July 27

Canada’s largest investment in Ukraine, the US$1 billion Black Iron mining and processing plant in Kriviy Rih, is being held up by delays at Ukraine’s Defense Ministry, Matt Simpson, CEO of the Toronto-based mining company, tells RBC-Ukraine. If the Defense Ministry completes a binding agreement on transfer of...

“This slow decision making to secure key land rights worries both our investors and us,” Simpson said in a lengthy interview. “Today, with the increasing demand for iron ore and sky-high prices for iron ore worldwide, the interest of investors in the extraction of raw materials is relativ...

Metinvest, Ukraine’s largest iron ore, coke and steel producer, will pay $339 million for Dniprovsky Integrated Iron & Steel Works, a bankrupt steel maker, ProZorro.Sale auction platform reported yesterday. With the purchase, Rinat Akhmetov, owner of Metinvest, raises his control of Ukraine’s steel production from 60% to 70%, calc...

Concorde Capital’s Dmytro Khoroshun writes: “Metinvest’s monthly EBITDA will likely amount to at least $400-500 mln in 2Q21 and in 3Q21 because of strong steel and iron ore prices. Steel prices will likely decrease by the year’s end, but produc...

With EU pressure growing fast to block imports of ‘dirty steel’, Interpipe is the first in Ukraine to slash CO2 emissions with a built from scratch electric arc steelmaking plant. Opened in 2012 at the cost of $1 billion, the plant produces less than 250 kilograms of CO2 per ton of steel, one tenth of the amount produced by the open hearth plant it replaced. The plant was large...

Responding to high world prices, Ukraine increased its pig iron production by 8% during the first half of this year, compared to January-June 2020. Ukraine smelted 10.8 million tons of pig iron, making it 10th in the world, between Taiwan and Germany, Ukrmetalurgprom reports, citing Worldsteel figures. Ukraine’s sli...

Ukraine’s steel production during the first half increased by 7.4%, to 10.9 million tons of steel. This is barely half the worldwide increase of 14.4%. Many Ukrainian metals companies found it more profitable to export pig iron than to refine it into steel. Ukraine is the world’s 14th largest steel...

President Zelenskiy has signed a decree designed to stimulate the exploration, mining and processing of 37 minerals deemed strategic for the world economy in the 2020s. Within two months, the Cabinet of Ministers is to prepare a list of strategic mining lots that should be put u...

Ukraine increased imports of coal by 18% during the first half of this year, to 10.1 million tons. In response to shortages at thermal power plants last winter, the imported coal bill nearly hit $1 billion for the first half. Top sources of coal: Russia – 60%; US – 22.5%; and ...

Monday, July 26

Congressional Republican and Democrats are united in opposition to the opening of Nord Stream 2, said Yuriy Vitrenko, the Chairman of Naftogaz, speaking with reporters in Washington. “Very positive — there is bipartisan support,” he told VOA of his meetings in the US Congress. “Both major U...

Vitrenko rejected the promise by Angela Merkel, Germany’s outgoing chancellor, to guarantee continued gas transit after 2024. “I cannot understand how Germany can guarantee transit of gas via the territory of Ukraine, if neither of those countries is in charge of producing and transporting the gas,” he told VOA. “Theoretical...

European gas prices are at 13-year highs, but Gazprom is only using 27% of Ukraine’s pipeline capacity, Serhiy Makogon, the General Director of GTS Ukraine Operator, tells the pipeline company’s press service. The strategy of spurning 100 bil...

Ukraine’s pipeline company expect to receive $1.3 billion this year to move gas from Ukraine’s Russian border to the EU . $1 billion of this amount is spent on running the pipeline company — paying 11,000 employees and performing maintenance. Without a long term transit contract after 2024, the pipeline network w...

“This is a one-way street — many Europeans do not understand this, ” he said if Ukraine’s Operator starts to close excess pipelines in 2024. He warned: “Then it will be impossible to turn everything back.”