OREANDA-NEWS. December 17, 2010. JKX via Poltava Oil & Gas (POG) company intends to supply natural gas to industrial consumers in Ukraine, the company spokesman announced Dec 16. The National Electricity Regulation Commission (NERC) issued a 5-year license (until Jan 2016) to POG permitting the company to proceed with gas supplies at non-regulated tariffs. The company has negotiated potential gas shipments with a number of companies; in particular the Arcelor Mittal Kryvyi Rih has been mentioned.

Millennium Capital considers the news as POSITIVE for JKX. Millennium Capital expects higher margins on gas sales for JKX resulting from the switch away from traders in deliveries. Presently the company sells its gas mainly to intermediaries with Shell purchasing c.65% (250-270 Mmcm) of natural gas extracted by POG. Under the license terms, the POG will supply up to 373 Mmcm per year of natural gas directly to industrial consumers.