Investments in gas sector depend on the tax regime

15 September 2014

The owner of the gas producing company Burisma Holdings Nikolai Zlochevsky considers it appropriate to reduce the tax burden on gas companies. He has stated it during the 11th YES Meeting, which was held in Kiev on September 12-13.

“The union of Ukraine should happen and then investments will go to us. First of all, you need to soften the tax for those who want to invest in the gas sector. This will attract new investments. This will provide new Western partners. In a year and a half, and we will see the effect of increasing production, I think, by 30 percent,” – said Zlochevsky.

According to the former Minister of Environment, he has decided to return into business in order to implement many initiatives in a practical way.

Burisma Holdings is the largest private gas producer in Ukraine. “Such a resource as “gas” is still the air for our economy; the real sector cannot be developed without any gas. Today, “no gas” is equal to the loss of potential capacity of our companies tomorrow, “- said Nikolai Zlochevsky.

According to him, the level of responsibility of private gas producers is very high today, not only towards the country but also towards every Ukrainian. That is why most of gas companies have focused their efforts on improving efficiency now. So, he said, thanks to the installation of new production equipment, Burisma Holdings plans to reach 80 million cubic meters of gas per month, and to receive 1 billion cubic meters of gas at the end of the year.

Zlochevsky has also noted that Burisma Holdings, together with other private gas producers will initiate a dialogue with the governement. “Our goal is to find the most efficient model of the functioning of the market in order to ensure the country’s energy security using the knowledge and experience of joint efforts. The need for such actions is proved with the international experience, many international experts have talked about it on Meeting, it is constantly spoken in Ukraine at all levels. It has long been proven that a private owner is the effective owner. Private companies can modernize production facilities and build its own production, can bring the entire sector to a new level, all – the country and the end consumer will benefit from it,” – said Nikolai Zlochevskiy.

Burisma Holdings is the largest independent gas producer in Ukraine working on local energy market since 2002. Today, the company is developing a natural gas field in the main basins of the country, including the Dnieper-Donets and the Carpathian. In the 1Q 2014, the daily gas production was 12.3 thousand BOE (barrels of oil equivalent per day – incl. gas, condensate and crude oil). The entire volume of production is sold at the domestic market of Ukraine.