By KYIV. Jan 10 (Interfax-Ukraine) – The actual selling price of natural gas, from which the royalty for its production in Ukraine is calculated, in December 2022 amounted to UAH 26,199.24 per 1,000 cubic meters, which is 9.2% less than in November (UAH 28,855.75), the Ministry of Economy has reported.
According to law No. 7732 on amendments to the calculation of the royalty for the use of subsoil for natural gas production, from August 1, 2022 and until the complete abolition of the ban on the export of Ukrainian gas, the calculation of royalty is based on the ceiling of three domestic selling prices.
NJSC Naftogaz Ukrainy in November (as of December) did not conclude contracts for the sale and purchase of gas from its own production in organized commodity markets (UEEX, UUB, UICE), and the weighted average price of gas sales by other market participants (excluding NJSC and its subsidiaries) on organized commodity markets amounted to UAH 25,000 per 1,000 cubic meters.
This price is less than the average UA VTP Gas price (arithmetic mean between the Bid and Ask prices in the Argus European Natural Gas and ICIS European Spot Gas Market reports) for the next month on a prepaid basis, on the basis of which the actual selling price was set for December at UAH 26,199.24 per 1,000 cubic meters.
As reported, before the adoption of law No. 7732, the actual selling price of gas was calculated as the arithmetic mean of the customs value of imports and quotations at the Dutch TTF gas hub.
The revision of tax legislation is associated with a significant increase in spot prices in Europe, a ban on the export of Ukrainian gas and a decrease in domestic consumption, which has led to the fact that production has become unprofitable for many companies, since the selling price in Ukraine is much lower than European prices.
Before March 2022, the gas royalty was calculated only on the basis of the customs value of imports.
