Naftogaz may record UAH 105B loss for Q1 2021 - Vitrenko.

National Joint-Stock Company Naftogaz of Ukraine is discussing a possible loss of almost UAH 105 billion for the first quarter of 2021, the company's press service has quoted CEO Yuriy Vitrenko as saying.

"Currently, discussions are underway to reflect in the report for the first half of the year two problems that were recorded in the first quarter. If they were fully reflected in the report for the first quarter, then instead of profit, we would have had a loss of up to UAH 105 billion for the state, as the owner of the NJSC," he said.

Vitrenko said that, first of all, the financial condition of heating and hot water supply enterprises, already at the time of formation of the report for the first quarter of 2021, did not give grounds to count on them repaying the debt for the natural gas they consumed.

The second problem is the NJSC's debt to Ukrnafta for the natural gas.

"At the time the report for the first quarter of 2021 was made, it could be clear that Ukrnafta would demand that it [the debt] be returned, and there are grounds to assess the relevant liabilities of the NJSC at the current market price," Vitrenko said.

He also added that the company's reports, formed under the previous Naftogaz management, were not properly audited.

At the same time, miscalculations in the gas production program lead to significant import costs for Ukraine.

"As a country, we now pay a very high price for failures, for example, in production for 2019-2021. If the extraction program had been implemented at least at some already old sites, the NJSC would not have imported $2 billion worth of gas this summer," Vitrenko said.

On April 28, 2021, the Cabinet of Ministers dismissed Andriy Kobolyev as Naftogaz CEO, appointing Vitrenko in his place. The net consolidated loss of the Naftogaz Group in 2020 amounted to UAH 19 billion. Last year, the company's performance was much better as the group's consolidated net profit exceeded UAH 63 billion.

Naftogaz's net profit for the first quarter of 2021 amounted to UAH 12.6 billion.

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