Ukraine plans to calculate gas rent based on domestic sales prices

According to the document, from August 1, 2022 until the lifting of the ban on the export of Ukrainian gas, it is planned to remove from the calculation of rent the average value of the customs value of imports and quotations at the Dutch TTF gas hub.

Instead, the calculation will be carried out on the basis of the maximum indicator of one of the values:

- the weighted average price in the contracts of Naftogaz of Ukraine concluded within the framework of the purchase of natural gas of its own production on organized commodity markets;

- The average weighted price of selling natural gas based on the results of auctions on organized commodity markets, excluding NJSC and its "subsidiaries".

- the arithmetic mean value of the average price of UA VTP Gas price for the next month and it is also on prepayment terms. The initiators of the draft law explain that due to Russian military aggression and gas blackmail organized by it, gas prices in Europe have reached record levels.

At the same time, the ban on the export of Ukrainian gas and the decrease in consumption within the country led to the fact that in August of this year its production became unprofitable since the sale price in Ukraine is three times lower than the European prices.

"As a result, most of the gas production has become unprofitable, which leads to a decrease in the volume of gas production and increases dependence on the import of natural gas to Ukraine. Therefore, it is proposed to regulate and optimize the issue of determining the tax base for natural gas produced in Ukraine from August 1, 2022, by changing the mechanism of determination of the actual sale price," the document states.

As reported, since April 2022, Law No. 7038-d has entered into force, which introduces a mechanism of differentiated rent payment for natural gas production depending on three levels of its sale prices - up to $150/thousand cubic meters, from $150 to $400 and over $400. The increased rent is set on the excess profit part of the price above $400.

The calculation of the sale price of gas, from which the rent is calculated, is determined as the arithmetic mean value of the customs value of imports and quotations at the Dutch TTF gas hub.

Previously, rent was calculated only from the customs value of imports. In addition, in May 2022, the Council adopted Law No. 7249 on the payment of rent for gas produced in the country from April 1 only upon the fact of its realization.

In 2021, Ukraine reduced gross natural gas production by 2% (by 0.4 billion cubic meters) compared to 2020, to 19.8 billion cubic meters. m, including the production of "Ukrgazvydobuvannya" amounted to 13.7 billion cubic meters, "Ukrnafta" - 1.1 billion cubic meters, private companies - 5 billion cubic meters.