Naftogaz Names New Auditors
Following a competitive tender, Ukraine’s economy and trade ministry has approved the appointment of Deloitte & Touche as auditor of Naftogaz Ukrainy’s consolidated financial accounts for 2015-16 to international accounting standards. The charge for doing this will be hryvnia 32.48mn (€1.12mn), Naftogaz said April 13.
Naftogaz CEO Andriy Kobolev told a conference in Brussels last week that the company had been historically financially unstable, but it was set to move into profit this year after losing some $10bn in 2014. This was partly to do with shifting responsibility for subsidies for poorer households on to the state budget and reducing corruption. Buying more gas from western Europe and less from Russia has also lowered its weighted average cost of gas. However it made a loss in the fourth quarter of last year as the heating season is when it sells most to households at below cost.
Naftogaz held another open tender to appoint an independent assessor to assess the fair value of Naftogaz' assets and of enterprises of which the company owns no less than 51% as of December 31, 2015. This led to the appointment of EY, for which it will be paid hryvnia 15.8mn.
Among them is the transportation network, a giant system of pipes that were laid down in the Soviet era and which Gazprom is using a lot less than formerly, now that it has built Nord Stream 1.
Ukraine's gas pipeline system is operated by Naftogaz Ukrainy's wholly-owned subsidiary UkrTransgaz, which last year made economies on gas used for transit in the compressor stations, despite transporting more gas, Kobolev said in an interview with local media this week. "There are many other such factors and we will present a detailed analysis of Naftogaz' efficiency when the audit has been done," he told Focus publication.
Naftogaz Ukrainy is planning to spin off the pipeline network, initially to the state property fund, as part of its commitment to unbundling, as required by the European Union's third energy package.
William Powell