KYIV – Reflecting Ukraine’s newly competitive gas market, foreign gas trading companies became so numerous this year that they now support an industry publication, in English.
Gennadii Kobal, a local oil and gas expert, launched the trade publication, ExPro, to meet a new demand for dependable gas volume and price information. At first, it was in Ukrainian. Then, in July, he added English to cater to EU-based traders.
For years, Ukraine had one gas supplier, Russia’s state-controlled Gazprom. But in Nov. 2015, Ukraine stopped buying gas directly from Russia. With the market opening of the last two years, there are now dozens of traders.
“We have a rising gas market here in Ukraine,” said Kobal, formerly a consultant for gas production companies. “A few years ago, we only had one big seller—Gazprom. Now we have nearly 50 companies engaged in importing gas from Europe, most of which are European companies.”
Jaroslav Kinach, long active in Ukraine’s gas production industry, said he subscribes to ExPro because it has reliable production information not readily available elsewhere.
“The industry is kind of closed,” Kinach said, remarking that independent companies are often left in the dark by state concerns that dominate the industry.
“The independent producers used to get together periodically in so called ‘scout meetings’ to share general, non-confidential information,” he said of past attempts to share information on the impact of laws and regulations. “We tried to formalize these group meetings into an industry association, but it never materialized when the global majors left Ukraine.”
Local companies recently organized an industry group, Kinach said, but it is mostly geared towards lobbying and not information sharing. That’s why ExPro is helpful.
“Their newsletter summarizes new legislation, rules, regulations, in addition to providing reliable and very useful information on production, market prices, transit volumes, as well as key developments among players,” he said.
Kobal said that of his roughly 300 subscribers, about one third choose English. Some are Ukrainians who prefer to read in English because they work with foreign partners.
Because traders want daily, not weekly, information, Kobal is building an ExPro website, which he plans to launch in coming weeks..
“I think an English version would even be more needed [than a Ukrainian one] at the moment,” he said of the website. English would be useful for foreign companies interested in Ukraine.
Even as the gas market grows in Ukraine, Kobal says that foreign production companies are not lining up to enter the country.
One year ago, Ukraine cut the tax on gas production here to 29 percent, from 55 percent. Now, the Rada is debating a law that would cut the tax on production from new wells to 12 percent, from 29 percent.
Kobal said cutting taxes is not enough.
“We need not only low royalties, but we need also a good law system,” said Kobal. “Not only tax, but to protect private investment. It will take some years to see foreign producers investing here.”
For comments and story tips, please email UBJ IT Correspondent Harvey Hinman at this address: firstname.lastname@example.org.
Slider Photo: Gennadii Kobal, founder and director of ExPro. (supplied)Inside Photo: ExPro’s weekly digest. (Harvey Hinman)