Expro.Com.Uaweekly September 7-13, 2020 №37 (224) 07-13.09.2020
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expro.com.uaWEEKLY September 7-13, 2020 №37 (224) 07-13.09.2020 WEEKLY REVIEW News Review It also became known that production sharing filled by 84%, which was record high during Annually, every second Sunday of September, agreements (PSAs), the competition for which the last 10 years. However, the rate of natu- Ukraine celebrates a professional holiday the took place more than a year ago, would result ral gas injection into UGS decreased from 110 Day of Workers of Oil&Gas Production and Re- in conclusion of contracts with the winners by mcm a day down to 87 mcm a day since the finery Industries. A few days before there was the end of the year. beginning of September due to reduced im- a meeting held between the Prime Minister of The good news of the last week was from the port supplies caused by the planned repairs Ukraine Denis Shmygal and the management UGV, as the company plans to put into oper- at Budince natural gas interconnection point. of the Naftogaz Group to present its vision of ation the Svyatogorsk tight gas field in early Noteworthy, Ukrainian UGS are again in the the market situation in Ukraine. The Naftogaz 2021. Currently, they are drilling the first well spotlight of potential foreign companies. Ac- Group believes that in the context of the eco- and laying a gas flowline from it. cording to the Chairman of Polish state oil nomic crisis, the Ukrainian oil&gas industry and Another UGV project, jointly with the Expert and gas company PGNiG Jerzy Kwieciński, the Naftogaz Group, as an integral part of it, Petroleum, will start on October 1, 2020, to the UGS in Western Ukraine in future could need the support from the state, in particular, to enhance production at 13 depleted gas fields join the Three Seas Initiative (TSI) for creation extend the incentive rent for natural gas produc- in Lviv region. The UGV transfers those hy- of a common natural gas market of Central tion from new wells for the first 5 years of opera- drocarbon deposits to the Expert Petroleum and Eastern European member-countries. tion, to simplify special permit procedure, to free to manage under long-term agreements, pro- According to Chairman Jerzy Kwiecińs- the JSC UkrGasVydobuvannya (UGV) from the viding that at least UAH 1 billion invested ki, Ukraine’s UGS are huge and much larg- Law of Ukraine «On Public Procurement». In his and production increased by 300 mcm over er than Poland actually needs. Therefore, ac- turn, the Prime Minister stressed that the gov- 5 years. cording to Kwieciński, in future the UGS could ernment, for its part, made every effort to do On September 5, 2020, Ukraine’s reserves service not only Poland, but also many other that, and would rely of the Parliament of Ukraine in underground gas storages (UGS) exceed- countries joining the TSI common natural gas to uphold relevant legislative initiatives. ed 26 bcm in natural gas. The UGS became market. Natural Gas Prices in Ukraine, UAH/tcm Natural Gas Prices in Ukraine, UAH/tcm 5 500 5 000 4 500 4 000 3 500 3 000 2 500 Offer Price Bid Price 2 000 1-Jul 6-Jul 9-Jul 3-Jun 9-Jun 1-Apr 6-Apr 9-Apr 3-Sep 8-Sep 4-Aug 7-Aug 14-Jul 17-Jul 22-Jul 27-Jul 30-Jul 2-Mar 5-Mar 4-May 7-May 12-Jun 17-Jun 22-Jun 25-Jun 14-Apr 17-Apr 23-Apr 28-Apr 11-Sep 12-Aug 17-Aug 20-Aug 26-Aug 31-Aug 11-Mar 16-Mar 19-Mar 24-Mar 27-Mar 13-May 18-May 21-May 26-May 29-May Dynamics of Brent crude quotes (ICE Index), $/bar Natural Naturalgas price gas Day price AheadDay Ahead (Open), (Open), NCG, NCG, €/MWh €/MWh Dynamics of Brent crude quotes (ICE Index), $/bar 12 60 11 10 50 9 8 40 7 30 6 5 20 4 3 10 2-Mar 17-Mar 1-Apr 16-Apr 1-May 16-May 31-May 15-Jun 30-Jun 15-Jul 30-Jul 14-Aug 29-Aug Copyright © 2020 Exploration & Production Ltd 1 expro.com.ua 07-13.09.2020 STATE-OWNED COMPANIES For the first time in Ukraine, Ukrnafta suc- which was not previously developed, and the and simplification of the permitting procedure; cessfully performed perforation in a hori- probability of obtaining commercial gas inflow • The introduction of incentive royalties for the zontal wellbore was low, based on geophysical survey data. production of tight gas; For the first time in Ukraine, specialists of ExPro Reference: • Reducing the Naftogaz’s burden to pay divi- Ukrnafta successfully performed perforation Sementsivske gas condensate field is located dends, which amount to 90-95%; in the horizontal section of the well, without in- on the territory of the Poltava region; it was dis- • Adoption of legislative changes to simplify ac- volving third-party service companies, which re- covered in 1976 and put into operation in 1981. cess to land areas for exploration and access to duced the cost of major well workover. This was Commercial gas-bearing potential is associated existing wells; reported by the chief geophysicist of Ukrnafta with layers of the Upper section of Serpukhovi- • Exclusion of Ukrgasvydobuvannya JSC from Andriy Starostin. an stage of the Lower Carboniferous at depths effect of the Law of Ukraine “On public procure- The main advantage of recovery of the produc- of 4,175-4,355m. Initial gas reserves in the field ment”. tive formation with a horizontal wellbore is an in- amounted to 18,783 million cubic meters (cat- crease in the drainage zone. This is especially egory C1), condensate reserves – 4,828 thou- Ukrgasvydobuvannya JSC plans to put the noticeable in reservoirs with an effective thick- sand tons (category C1). Svyatohirska field into operation in early ness of less than 10 meters. The vast majority of 2021 wells in Ukraine, where the productive horizon is Strategic directions for increasing Naf- Ukrgasvydobuvannya JSC plans to put into penetrated with a horizontal wellbore, are cased togaz’s hydrocarbon reserves have not operation the Svyatohirska field of tight gas with slotted liners. However, this method has a changed in early 2021. drawback – the complexity of infiltration zone The Naftogaz group presented to the Prime “A new well is currently being drilled at Svyato- cleaning. So, the specialists of Ukrnafta decided Minister of Ukraine Denys Shmyhal strategic di- hirska; it was drilled based on the results of a to carry out re-perforation in the intervals cased rections and projects for natural gas production, new wide-azimuth 3D seismic survey. We plan with a slotted liner. among which the prospects for the development to put the field into operation at the beginning “In a well cased with a slotted liner in the hori- of deep horizons, unconventional gas plays in of next year,” Oleksandr Romanyuk, Director of zontal section, perforation was carried out with tight rocks and the Black sea shelf are tradition- the Exploration and Production Division of the a 100% effectiveness of the tubing conveyed ally the main ones. This is reported by the press Naftogaz Group said. heat-resistant jet gun over 18-meters interval service of Naftogaz. According to him, wells had already been drilled with a density of 20 holes/meter, with 60 de- Heads of ministries, other central authorities at the field, but there was no commercial gas in- grees oriented charges” the geophysicist noted. and people’s deputies of Ukraine also partici- flow since they were drilled on the basis of 2D Teams from the СWO department, integrated pated in the discussion. seismic and did not fall into sweet spots. field management department, production de- The participants of the meeting were presented partment, OGDU, and NIPI of Ukrnafta worked the prospects for the development of deep hori- In eight months, Naftogaz paid UAH 92.5 on the project for perforation in the horizontal zons, unconventional gas plays in tight rocks billion to the state budget section of the well. and the Black sea shelf. According to operational data for January-August The presentation also emphasized that in the 2020, revenues to the state and local budgets Poltavagasvydobuvannya restored well conditions of the economic crisis, the industry from the Naftogaz Group amounted to about UAH #507 of the Sementsivske field with a flow and the Naftogaz group, as a significant compo- 92.5 billion (including the balance of dividends rate of 40 thousand cubic meters nent of it, needs serious support from the state, based on the results of 2019 – UAH 39.6 billion). The gas production office Poltavagasvydobu- namely: Revenues from Naftogaz Group enterprises ac- vannya (part of the Naftogaz exploration and • Negotiating the terms of the PSA in 4 areas; counted for more than 17% of total state budget production division) has successfully restored Access to Yuzivska area; revenues in January-August 2020. well #507 of the Sementsivske field, which has • Granting Naftogaz licenses for geological ex- Naftogaz Group remains the largest taxpayer in been waiting for abandonment for the past 5 ploration of the areas on the Black sea shelf; Ukraine. According to the results of 2019, the to- years. The company reported. Capital workover • Extension of the effect of the incentive royal- tal amount of tax and dividend payments of the of the well No. 507 was performed for the pur- ties for production from conventional gas depos- group to budgets of all levels amounted to UAH pose of additional exploration of the S-5 horizon, its for new wells for the first 5 years of operation, 121.4 billion.