EITI UKR · 3 Cost of imported products, million USD Russia Germany Norway Hungary Other країни Russia Germany Norway Other ЄС країни ЄС 6.1 3.5 2.1 3.2 1.5 2014 14.5

ЗВІТ ІПВГ УКРАЇНИСкорочена версія

UKRAINE EITI REPORTThe abbreviated version

20142015

EITI REPORT OF UKRAINEThe abbreviated version

20142015

This report is abbreviated version of National EITI Report of Ukraine 2014-2015 and intended solely for presentation purposes. For detailed information use National EITI Report of Ukraine 2014-2015.

3

EITI REPORT OF UKRAINE 2014-2015

THE EXTRACTIVE INDUSTRIES TRANSPARENCY INITIATIVE (EITI): INFORMATION ON THE INITIATIVE AND HISTORY OF ITS DEVELOPMENT IN UKRAINE

THE SCOPE OF THE EITI REPORT OF UKRAINE 2014-2015

The Extractive Industries Transparency Initiative (EITI) is a global Standard that has the main purpose of promoting the transparency of revenues of a state from its natural resources. The countries implement-ing the EITI Standard should disclose the information on tax and other payments received by the state from natural resources extractive companies, the proce-dures for granting permits (licenses) for the use of natural resources and other information related to the use of natural resources.

The governance and control over the EITI implemen-tation in a given country are executed by a Multi-Stakeholder Group (MSG), which include repre-sentatives of the government, business and civil soci-ety. Ukraine also has the EITI National Secretariat, which coordinates the activities of implementation of the EITI in Ukraine.

More information on EITI in Ukraine can be found on the website www.eiti.org.ua

Extraction of coal;Extraction of crude oil;Extraction of natural gas;Mining of iron ores;Mining of titanium ores;Mining of manganese ores;Transportation of oil and gas.

In 2014-2015, based on the results of scoping study and analysis of the information received from the State Fis-

cal Service of Ukraine, the scope of the EITI Report cov-ered 97 extractive companies, which together paid more than 99% of tax revenues to the Consolidated budget of Ukraine from extractive industries.

Overall, only 51 of 97 extractive companies responded to a request distributed for the purposes of preparing the Report. In addition, the Independent Administrator received a response from 7 extractive companies that were not designed for reconciliation.

Information on the Initiative

The development of EITI in Ukraine

2009September 30

2013October 17

2015July 31

2012October 10

2015June 16

2015 December

2017 July

Ukraine committed to implement the EITI, having approved Resolution No. 1098 of the Cabinet of Ministers of Ukraine «On Ukraine’s Accession to the Extractive Industries Transparency Initiative»

The EITI Multi-Stakeholder Group in Ukraine was created, which includes representatives of the government, business and civil society, on an equal basis

Parliament passed the Law of Ukraine No. 521-VIII «On Amendments to Certain Legislative Acts of Ukraine on Ensuring the Transparency in the Extractive Industries»

The agreement with the Independent Administrator was concluded. The preparation of Ukraine’s first EITI Report began

Publication of Ukraine’s first national EITI Report

Publication of Ukraine’s second national EITI Report, which covers two calendar years and additional extractive industries

The first validation of Ukraine by the EITI International Secretariat

Ukraine was accepted as an EITI Candidate Country

2017February

2

EITI IN UKRAINE SUPPORT BY:

World Bank

International Renaissance Foundation

USAID

German and UK Governments through the “Good Financial Governance” Project implemented by the federal enterprise Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH.

BRIEF OVERVIEW OF UKRAINE’S EXTRACTIVE INDUSTRIES

According to Geoinform of Ukraine SRPE, as of the beginning of 2014, more than 20 thousand ore deposits and manifestations containing 117 types of minerals have been identified in Ukrainian territory, of which approxi-mately half are of commercial value and are registered in the State Registry of Mineral Reserves.


4

FOSSIL FUELS

oil natural gas

oil and natural gas

COAL

METAL ORES

Hard coal

Donetsk Basin

COAL BASINS

Lviv-Volyn basin

iron ores

manganese ores

titanium ores

Vinnytsia

Zhytomyr

Cherkasy

Kropyvnytskyi

Zaporizhzhia

Chernihiv

Luhansk

BLACKSEA

Azov sea

KYIV

Uzhgorod

Rivne

Lutsk

Lviv

Ivano-Frankivsk region

Chernivtsi

KhmelnytskyTernopil

Kharkiv

Sumy

Poltava

Odesa

Mykolaiv

Kherson

Simferopol

MAIN FIELDSMINERAL RESOURCES

Fe

Fe Fe

Fe

FeFe

Fe

Ti

Ti

Mn

Mn

Ti

Donetsk

DniproKremenchug basin

IRON ORES BASINS

Kryvyi Rih basin

Kerchensky basin

Nikopol basin

MANGANESE BASINS

KM

KM

KR

KR

KCH

KCH

NK

NK

DN

DN

DN

LV

LV

5

12

3

East oil and gas region

West oil and gas region

South oil and gas region

123

OIL AND GAS REGIONS

7,891

44,317

COAL

Structure of the hard coal reserves, by the category as of 01.01.20163

Structure of the balance reserves of hard coal as of 01.01.20164, mln t

Ucertain Purpose Reserve

Balance Reserves (А+В+С1)

Balance Reserves (С2)

Off-balance Reserves

15.8%

60.5%

23.7%17,374.4 mln t

44,316.7 mln t

11,539.7mln t

18.5 mln t

0.0%

7


Reserves for extraction – 1115 years1 Reserves for consumption – 979 years2

1 Balance reserves of coal will cover extraction for 1115 years, if the volumes of extraction remain at the same level as in 20152 Balance reserves of coal will cover consumption for 979 years, if the volumes of consumption remain at the same level as in 20153 Geoinform of Ukraine SRPE4 Geoinform of Ukraine SRPE

Total balance reserves (А+В+С1)

«Д» - type

«Г» - type

«ДГ» - type

«А» - type

«Б» - type

«П» - type

«Ж» - type

«К» - type

«ПС» - type

13,002

6,669

6,094

1,011

1,922

2,565

2,569

2,594

5 Geoinform of Ukraine SRPE

6 According to companies’ responses

64,700

Coal extraction in Ukraine, by region, thous. t

Total (regions)

Luhansk

Donetsk

Dnipropetrovsk

Lviv

Volyn

2014 2015

2 565

17,90126,074

0

1,816

18,909

39,515Total (regions)

Lugansk

Donetsk

Dnipropetrovsk

Lviv

Volyn

2 565

4,33214,367

0

1,983

18,833

Structure of the balance reserves of hard coal, by region (as of 01.01.20155), mln t


2 565

13,55414,320

1,031

1,987

10,339

69

Luhansk

Donetsk

Dnipropetrovsk

Kharkiv

Lviv

Volyn

Volumes of coal extraction by companies in 2014-20156, thous. ton

2015

2014

5,21

14,

375

4,87

01,

773 3,

165

813

1,61

61,

754

1,28

41,

248

930

643

890

691

773

911

2,54

91,

2932,

693

2,42

8

1,55

25,

187

18,7

8718

,917

-10%

+18%

-22%

-31%

-3%

-16%

-49%-64%

+9%

-70%

-74%

-1%

DTE

KPa

vlog

radv

uhill

ia P

rJSC

Shak

htou

prav

linni

aPo

krov

ske

PJSC

DТЕ

КRo

venk

yant

rats

yt L

LC

DTE

KSv

erdl

ovan

trat

syt L

LC

Kras

nodo

nvuh

illia

PrJ

SC

DTE

KD

obro

pilli

avuh

illia

LLC

DTE

K M

ine

Kom

som

olet

sD

onba

su P

rJSC

Lviv

vuhi

llia

Stat

e En

terp

rise

Sely

divv

uhill

iaSt

ate

Ente

rpris

e

Vuhi

lna k

ompa

niia

Kr

asno

lym

ansk

a Sta

te E

nter

prise

Shak

htou

prav

linni

a Pi

vden

nodo

nbas

keN

o 1

Stat

e En

terp

rise

Min

e Bi

loze

rska

ALC

6

98

7 Export of hard coal by country 8 According to State Statistics Service of Ukraine

2 56

5

1,98

810,4

67

41965768

3

299

181

2,80

67,92

6

88583

9952

928

262

14,6

94

Import of hard coal, by country8

2014 2015

14,5

98

Kasa

khst

an

Aust

ralia

USA

Cana

da

Sout

h Af

rica

Tota

l

Russ

ia

Oth

er

Kasa

khst

an

Aust

ralia

USA

Cana

da

Sout

h Af

rica

Tota

l

Russ

ia

Oth

er

Volu

me

of im

port

edpr

oduc

ts,

thou

s. to

n

Cost

of

impo

rted

pro

duct

s,m

illio

n U

SD 1,793

1,154 95 104 60 32 24

1,631

774 393 123 128 114 68 31324

7,03

4

2 56

5

724

1,73

4

47362

6629

332

332

261

235

226

1,46

2

562 6534

8

233353

14 26

Export of hard coal, by country7

2014 2015

Tota

l

Russ

ia

Mar

occo

Turk

ey

Spai

n

Slov

akia

Bulg

aria

Pola

nd

Rom

ania

Indi

a

Gre

at B

ritai

n

Oth

er

Tota

l

Slov

akia

Turk

ey

Gre

ece

Mar

occo

Russ

ia

Bulg

aria

Oth

er

Volu

me

ofex

port

ed,

thou

s. to

n

Cost

of e

xpor

ted

prod

ucts

,m

illio

n U

SD

54

107152023212641454751

125

521

413 14 23

Structure of the balance reserves of natural gas as of 01.01.2016

22%

50%

28%

NATURAL GAS

Reserves for extraction – 46 years9 Reserves for consumption – 27 years10

9 Balance reserves of natural gas will cover extraction for 46 years, if the volumes of extraction remain at the same level as in 201510 Balance reserves of natural gas will cover consumption for 27 years, if the volumes of consumption remain at the same level as in 2015

Structure of the natural gas reserves, by the category as of 01.01.2016

1.0%

99.0%

0.0%14 million mcm9,293 million mcm

203,308million mcm

464,368 million mcm

256,439 million mcm

924,115 million mcm

Provisional balance reserves

Balance reserves

Off-balance reserves

Proven reserves (code 111)

Proven probable reserves (code 121)

Preliminary explored probable reserves (code 122)


11


10

Ukr

gazv

ydob

uvan

nia

PJS

C

Ukr

natt

a PJ

SC

Nat

toga

zvyd

obuv

anni

a PJ

SC

Ener

hose

rvisn

a ko

mpa

niia

Esco

-Piv

nich

LLC

Kub-

gaz

LLC

Pryr

odni

Res

ursy

Pr J

SC

Join

Ven

ture

Pol

tavs

ka g

azon

atto

va k

ompa

niia

LLC

Vydo

buvn

a ko

mpa

niia

Ukr

nafto

burin

nia

Pr JS

C (M

ECI d

ata)

Ukr

gazv

ydob

utok

Pr J

SC

Pers

ha u

krai

insk

a ga

zona

ftova

kom

pani

ia L

LC

Rega

l Pet

role

um C

orpo

ratio

nLi

mite

d LL

C

2 565

7,5839,704

455

634

673

505

1,030

20,584

Natural gas extraction in Ukraine, by region, mln mcm

2014 2015

19,908

Structure of the balance reserves of natural gas, by region, mln mcm

36%

as of 01.01.2016as of 01.01.2015

Poltava region

Kharkiv region

Lviv region

Sumy region

Black sea shelf

Other

328,917

37%343,145

69,545

37%358,461

975,696924,115

36%353,037

76,802

109,959 106,014

-5%

4%38,98839,931

4%37,506

8%

11%11%

4%37,506

4%

Kharkiv

Poltava

Lviv

Sumy

Ivano-Frankivsk

Luhansk

Other

Kharkiv

Poltava

Lviv

Sumy

Ivano-Frankivsk

Luhansk

Other

2 565

7,9779,338

439

513

645

303

693

Total (regions) Total (regions)

Import of natural gas, by country

1,30

2

1,49

7

608

14,5

28

Volumes of natural gas extraction, by company in 2014-2015, mln mcm

2015

2014

+4%

-3%+81%

+41%-9%

-29%

+74%-14%

+7%

-4%

-5%

1,73

3

585

336 23

9

170

239

120

116

75 137

56 53

217

25275

1

15,1

14

238

268

Volu

me

of im

port

ed p

rodu

cts,

billi

on m

3Co

st o

f im

port

ed

prod

ucts

,m

illio

n U

SD

Russ

ia

Ger

man

y

Nor

way

Hun

gary

Oth

erкр

аїни

ЄС

Russ

ia

Ger

man

y

Nor

way

Oth

erкр

аїни

ЄС

6.1 3.5 2.1 3.2 1.5

2014

14.5 0.9 1.32.8

1,677 940 874 595 421

19.5

2015

16.4

4,5075,6943,940

976301

477

Structure of the oil reserves, by the category as of 01.01.2016

14.4%

43.8%41.8%

13

12

11 In the section the term "oil" means «oil and gas condensate»12 Balance reserves of oil will cover extraction for 509 years, if the volumes of extraction remain at the same level as in 201513 Balance reserves of oil will cover consumption for 336 years, if the volumes of consumption remain at the same level as in 2015

39,849 thous. t

121,290 thous. t

115,790thous. t

Structure of the balance reserves of oil as of 01.01.2016

5%

55%40%

5,798 thous. t

66,288 thous. t 49,204thous. t

OIL AND GAS CONDENSATE 11

Reserves for extraction – 509 years12

Reserves for consumption – 336 years13

Balance reserves


Uncertain purpose reserves

Proven reserves (code 111)

Proven probable reserves (code 121)

Preliminary explored probable reserves (code 122)

Structure of the balance reserves of oil, by region, thous t

20%

As of 01.01.2016As of 01.01.2015

Poltava region

Sumy region


Lviv region

Chernihiv region

Other

24,559

20,693

21%26,840

126,651121,290

21,762

18%21,426

17%21,714

18,36318,450

9,92211,529

-4%

8%15%

17%

22%21%

9%

2 565

365917

124

186

363

65

15

4

2,039

Oil extraction in Ukraine, by region, thous t

2014 2015

1,817

Sumy

Ivano-Frankivsk

Chernihiv

Poltava

Lviv

Kharkiv

Dnipropetrovsk

Other

Sumy

Ivano-Frankivsk

Chernihiv

Poltava

Lviv

Kharkiv

Dnipropetrovsk

Other

2 565

320817

138

167

304

51

16

4

Total (regions) Total (regions)

26,356 26,327


45.0

11.9 3.

6

15


14

-44%

+56%

-16% -5%

-3%-35%

-11%

+4%

-5%

-12%

-14%

-4%

-12%

Ukr

natt

a PJ

SC

Ukr

gazv

ydob

uvan

nia

PJS

C

Pryr

odni

Res

ursy

Pr J

SC

Join

Ven

ture

Ukr

karp

atoi

l LLC

Pol

tavs

ka g

azon

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vako

mpa

niia

Join

t Ven

ture

Kash

tan

Petr

oleu

mLT

D Jo

int V

entu

re

Vydo

buvn

a ko

mpa

niia

Ukr

nafto

burin

nia

Pr JS

C

Nat

toga

zvyd

obuv

anni

a Pr

JSC

Rega

l Pet

role

umCo

rpor

atio

n Li

mite

d LL

C

Kub-

gaz

LLC

Ener

hose

rvisn

a ko

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Esco

-Piv

nich

LLC

Arab

skyi

ene

rget

ychn

yial

ians

IUEI

LLC

Ukr

gazv

ydob

utok

Pr J

SC

46.051

2.63

28.8

1,66

0.7

Volumes of oil extraction, by company in 2014-2015, thous t

2015

2014

28.8

14.2 5.

6

4.4

4.2 4.0

4.2

4.0

3.936

.7

30.3

1,87

7.3

532.

90

52.2

51.7

42.8

34.036

.134

.3

16

131

0.1

82.0

Volu

me

of im

port

edpr

oduc

ts, t

hous

. ton

Cost

of i

mpo

rted

prod

ucts

,m

illio

n U

SD

Import of crude oil, by country

227.4

0.3

2014

159.7 18.9

178.6

2015

227.7

82.1147

Oth

er

Kaza

khst

an

Kaza

khst

an

Russ

ia

0.1

27.3

0

3.0

Volu

me

of e

xpor

ted

prod

ucts

, tho

us. t

onCo

st o

f exp

orte

d pr

oduc

ts,

mill

ion

USD

Oth

er

Lith

uani

a

Oth

er

Lith

uani

a

Export of oil, by country

8.0

0

2014

41.2

2015

0.1

41.3 8.0

3.027.4

5,15

4

14,1

97

Structure of iron ores reserves, by the categories (as of 01.01.2016), thous t

6%

82%

12%

17


16

14 Balance reserves of iron ores will cover extraction for 125 years, if the volumes of extraction remain at the same level as in 201515 Balance reserves of iron ores will cover consumption for 148 years, if the volumes of consumption remain at the same level as in 2015

2,316,431.00thous t

29,222,217.90 thous t

4,129,901.00 thous t

IRON ORES



Balance reserves



-11% -3%

+1%

+3%

-93%

-15%

+17%

-3%

-6%

+55%

Ingu

lets

GZK

PrJ

SC

Polta

vsky

GZK

Pr J

SC

Nor

ther

n G

ZK P

r JSC

Arce

lorM

ittal

Kry

vyi R

ih P

JSC

Sout

hern

GZK

PJS

C

Cent

ral G

ZK P

r JSC

Yery

stiv

skyi

GZK

LLC

Kryv

yi R

ih ir

on o

rein

dust

rial c

ompl

ex P

JSC

Zapo

rizhz

hia

iron

ore

indu

stria

l com

plex

PrJ

SC

Evra

z Su

kha

Balk

a Pr

JSC

IIyic

h iro

n an

d st

eel w

orks

P JS

C

Vost

ok-r

uda

LLC

27, 9

80

24,6

23

24,0

9428, 0

93

Volumes of iron ores extraction, by company in 2014-2015, thous t

2015

2014

4,50

94,

381

+2%

2,83

22,

876

513

598

412

28

24,2

6431,6

87

28,8

76

28,8

48

24,7

66

23,

944

13,6

8814

,394

Structure of the balance reserves (А+В+С1) of iron ores, by region (as of 01.01.2016), thous t

21,579,228Total (regions)

5,462,30912,127,529

365,680

868,733

2,471,473

283,504

Dnipropetrovsk

Poltava

Zaporizhzhia

Crimea AR

Kirovohrad

Donetsk

Iron ores extraction in Ukraine, by region, thous t


38,038126,314

4,381

7,316

Dnipropetrovsk

Poltava

Kirovohrad

Zaporizhzhia


38,820121,667

4,509

7,048

Dnipropetrovsk

Poltava

Kirovohrad

Zaporizhzhia

5,47

5

9,16

2

2014 2015

7

-5%

2015

2014

240

250

63

63

-4%

19


18

2 56

5

4,91

5

12,0

25

846

4701,

7613,

615

410

227

93

24,3

61

Export of non-agglomerated iron ores, by country

2014 2015

Rom

ania

Slov

akia

Czec

h Re

publ

ic

Pola

nd

Hun

gary

Aust

ria

Tota

l

Chin

a

Serb

ia

Oth

er

2 56

5

4,54

115,2

20

1,16

3

1541,

6544,

058

455

517

386

28,1

47

Rom

ania

Slov

akia

Czec

h Re

publ

ic

Pola

nd

Hun

gary

Aust

ria

Tota

l

Chin

a

Serb

ia

Oth

er

Volu

me

of e

xpor

ted

prod

ucts

,th

ous.

ton

Cost

of e

xpor

ted

prod

ucts

,m

illio

n U

SD

1,741

4

14

22

34

69

119

258

361860

1,040560

178

144

61

53

6

10 8

20

Titanium ores extraction in Ukraine, thous t

TITANIUM ORES



16 Balance reserves of titanium ores will cover extraction for 28 years, if the volumes of extraction remain at the same level as in 2015 (http://minerals.usgs.gov/minerals/-pubs/mcs/2016/mcs2016.pdf ).17 Balance reserves of titanium ores will cover consumption for 1053 years, if the volumes of consumption remain at the same level as in 2015

Reserves of titanium ores (as of 01.01.2016)

30%

70%

2,500 thous t

5,900 thous t

Ilmenite

Rutile

Ilmenite

Rutile

0.04

0.60

0.24

0.00000.00000.0037

Volu

me

of im

port

ed p

rodu

cts,

thou

s. to

nCo

st o

f im

port

edpr

oduc

ts,

mill

ion

USD

Sout

h Af

rica

Sout

h Af

rica

Aust

ralia

Aust

ralia

Egyp

t

Egyp

t

Import of titanium ores and concentrates, by country

0.004

0.000

2014

3.3

3.7

2015

0.004

0.00370.97

0.3 0.0000.1

21


20

Export of titanium ores and concentrates, by country

2014 20152

565

85

120

202060

10 13

73

107

12

2437

20

22

329

295

Gre

at B

ritai

n

Chin

a

USA

Kaza

khst

an

Czec

h Re

publ

ic

Tota

l

Russ

ia

Oth

er

Gre

at B

ritai

n

Chin

a

Czec

h Re

publ

ic

Kaza

khst

an

USA

Tota

l

Russ

ia

Oth

er

Volu

me

of e

xpor

ted

prod

ucts

, th

ous.

ton

Cost

of e

xpor

ted

prod

ucts

,m

illio

n U

SD

22.7

13.6

4.3

6.8

6.3

17.329.8

100.871.8

19.711.4

8.6

0.0

2.4

11.9

17.8

MANGANESE ORES



18 Balance reserves of manganese ores will cover extraction for 594 years, if the volumes of extraction remain at the same level as in 201519 Balance reserves of manganese ores will cover consumption for 451 years, if the volumes of consumption remain at the same level as in 2015

Structure of manganese ores reserves, by the category (as per 01.01.2016), thous t

2%

98%

0%0.00 thous. t

58,038.20 thous. t

2,380,194.90 thous. t

Balance



Structure of the balance reserves (А+В+С1) of manganese ores, by region (as of 01.01.2016), thous t

2,182,916Total (regions)

598,6801,578,200

6,036

Zaporizhzhia

Dnipropetrovsk

Kherson

23


22

Volumes of manganese ores extraction, by ccompany in 2014-2015, thous t

2015

2014

Ordzhonikidze GZK PJSC Marganets GZK PJSC Landshaft LLC

2,33

9.0

+14%

+3%

-100%

2,26

8.7

1,33

5.9

1,17

6.3

0.09.

5 278.

2

502.

6

26.4

8.772

.283.5

971.

4

Import of manganese concentrate and agglomerate, by country

2014 2015

Russ

ia

Bras

il

Aust

ralia

Sout

h Af

rica

Tota

l

Gha

na

Oth

er

275.

1

654.

1

17.1

0.092

.6

232.

6

1,27

1.6

Russ

ia

Bras

il

Aust

ralia

Sout

h Af

rica

Tota

l

Gha

na

Oth

er

Volu

me

of im

port

edpr

oduc

ts,

thou

s. to

n

Cost

of i

mpo

rted

prod

ucts

,m

illio

n U

SD 186.1

160.3

52.014.6 2.1

60.726.4

4.6

71.4

49.0

27.7

3.2

35.0

0.0

4.9

30.8

0.11.

73.040

.5

Export of manganese concentrate and agglomerate, by country

2014 2015

Russ

ia

Pola

nd

Czec

h Re

publ

ic

Chin

a

Tota

l

Slov

akia

28.6

67.6

1.7

0.05.

77.8

111.

4

Pola

nd

Slov

akia

Czec

h Re

publ

ic

Geo

rgia

Tota

l

USA

Oth

er

Volu

me

of e

xpor

ted

prod

ucts

, th

ous.

ton

Cost

of e

xpor

ted

prod

ucts

,m

illio

n U

SD

0.0

0.30.7

6.4

0.00.62.8

0.33.7

11.4

4.2

0.4 0.3

15,6

95.2

25,1

91.9

Ukrtransgaz PJSC Ukrtransnafta PJSC

25


24

OIL AND GAS TRANSPORTATION

The volume of gas transit through the territory of Ukraine in 2009-2015

Transit through Ukraine, billion cub. m

Transportation to the Ukrainian customers, billion cub. m

Revenue from main activity,million UAH

Volume of oil transportation and transit, million tones

Net profit, million UAH

2009 2010 2011 2012 2013 2014 2015

-5.8%

44.5

95.8

50.498

.6

51.710

4.2

48.884

.3

44.1

86.1

38.162

.2

30.467

.1

Revenue and profit of gas and oil transportation system Operators

2012 2013 2014 2015

16,4

40.8

14,2

65.6

The volume of oil transit and transportation to refineries in Ukraine 2009-2015

Transit, million ton

Transportation to refineriesin Ukraine, million ton

2009 2010 2011 2012 2013 2014 2015

9.4

29.1

9.720

.1

9.817

.8

4.0

14.6

2.2

15.6

1.8

15.0

1.6

15.2

-10.3%

16.867.162.2

86.184.3

2,32

1

2013 2014 2015

2,87

6

3,33

0

2012 2013 2014 2015

452.6

-1,253.7-3,293.1 -54.0

688.7

1,360.3

-777.0

2013 2014 2015

16.817.6

Volumes of naturalgas transit, billion cubic meters

97.1

76.6

11.1 75

.710

.9

67.6

9.0 77

.76.

9

26.45.

2

689.1

355.0

126.7

228.3

656.2

294.4

361.8

236.7

452.4

The weighted average tariff for natural gas distribution ("oblgas")

Tariff for "direct pipes" customers

Tariff for Uktransgaz PJSC main pipelines transportation Total government revenues from extractive industries in 2014-201521 , thous UAH

7,904,067.79

37,802,949.56

7,207,832.35

+590%+651%

-6.0%

+408% -24.1%

+81.2%+288%

+594%

+14.4%+166.5%

+98.5%

+1,026%

+148.7%

25.0

27


26

Tariffs for natural gas transportation and distribution,20 UAH / thousand m3

01.01.2014 -30.04.2014

01.05.2014 -31.05.2014

01.06.2014 -31.03.2015

01.04.2015 -30.06.2015

01.07.2015 -30.09.2015

01.10.2015 -31.12.2015

20 Consumers "on the direct pipes" – consumers, whose pipelines are directly connected to the trunk gas pipelines

287.0

93.9

193.1

366.7

138.4

228.3

663.5

275.7

387.8

615.1 615.1 615.1

325.6 325.6265.1

Tariffs for oil transportation via the trunk pipelines, UAH/t

Dolina -Drohobych

M. Pavlivka -Refinery in

Kremenchuk

Hnidyntsi -Refinery in

Kremenchuk

Glinsko -Rozbyshivska

Refinery inKremenchuk

Oryv -Drohobych

Borislav -Drohobych

2015

20142015

2014

37,1

52,0

65.2

2

18,7

14,7

25.5

2

Total government revenues from extractive companies, per revenue streams in 2014-201522, thous UAH

Productionroyalty

Valueadded tax

Corporateincome tax

Personalincome tax

Excise tax Environmentaltax

Transportationroyalties

TAX PAYMENTS OF EXTRACTIVE COMPANIES

57,997,468.11Total

Oil and gas

Metal ores

Coal

Oil and gas

Metal ores

Coal

92,515,345.07Total

2014 2015

12,986,686.21 14,246,339.39

70,364,937.89

25,3

19,5

86.9

9

9,15

3,10

1.75

8,60

7,51

5.64

1,36

2,85

3.79

3,63

2,13

4.95

2,69

6,39

3.39

3,08

3,91

5.39

665,

085.

04

1,65

3,90

3.52

680,

298.

39

516,

013.

47

13,9

75,9

33.4

121 According to the State Fiscal Service of Ukraine22 According to the State Fiscal Service of Ukraine

Share of government revenues, which were reconciled

-1.1%-0.1%

-0.1%

-1.4%

+2.2% -0.1%

29


28

20152014

82.6% Extractive industries

20152014

Coal

Metal ores

Oil and gas

Reconciliation of tax payments, per industry, thous UAH

Oil and gas Metal ores Coal

29,

507,

558.

08

29,5

37,1

04.2

5

6,4

09,5

15.8

2

6,40

1,01

5.51

2,92

7,04

2.12

2,99

1,45

3.41

Reported by companies

Reported by SFS

Oil and gas Metal ores Coal

54,9

41,4

56.6

0

54,1

57,4

88.7

8

6,75

8,01

5.15

6,68

4,22

7.72

4,82

1,27

9.12

4,81

8,83

5.99

82.8%

85.7% 85.0%

66.1% 65.6%

98.1% 93.9%

Other non-tax payments by the companies in 2014-2015 to the state enterprises and central executive authorities23, mln UAH

Payments that weren’t reconciled

Non-tax payments ofcompanies in 2014

Socialpaymentsand donations(2014)

Coalsector

Iron Oresector

Oil andGas sector

Non-tax payments ofcompanies in 2015

Reconciled payments543.1 330.7

294.5

36.2

604.1

2014


Reported by SFS


30 31

OTHER PAYMENTS OF EXTRACTIVE COMPANIES

-45.3%

10.9%61.0

10.1%

953.

0

39.1

840.

8

73.1

Socialpaymentsand donations(2015)

Coalsector

Iron Oresector

Oil andGas sector

998.

2

17.5

868.

8

112.

0

Extractive companies’ social costs and charitable contributions in 2014-201524, UAH mln

2014 2015

0.0%

0.0%

+0.4%

+2.8%

-5.3%

0.0%

0.0%

14,1

50,8

21.1

9

14,1

50,1

98.8

0

Productionroyalty

Valueadded tax

Corporateincome tax

Personal income tax

Excise tax Екологічнийподаток

Transportation royalties

12,5

20,1

04.4

2

2,43

3,34

4.10

2,50

1,01

3.05

1,36

2,85

3.79

1,36

2,85

3.00

665,

085.

04

630,

162.

20

613,

262.

62

613,

516.

77

12,4

66,5

99.5

5

7,15

2,77

2.11

7,15

1,10

2.53

Reconciliation of tax payments, per type of payment, thous UAH

2015


Reported by SFS

-0.9%

+0.6%

-0.4%

0.0%

-2.3%

-2.4%

+0.1%

27,7

61,8

20.1

7

28,4

48,2

88.1

6

Productionroyalty

Valueadded tax

Corporateincome tax

Personalincome tax

Excise tax Екологічнийподаток

Transportationroyalties

23,1

42,3

58.7

4

3,63

2,13

4.95

3,63

2,13

5.00

2,99

8,45

8.39

3,00

0,99

8.51

1,65

3,90

3.52

1,61

5,90

8.20

461,

972.

23

464,

521.

71

23,2

27,9

58.4

6

6,09

8,03

5.14

6,04

2,81

0.15

23 According to queried companies’ responses24 According to queried companies’ responses

State budget

Regional budget,budget of thecity of Kyiv

Local budgets

State budget

Local governmentbudgets

Local budgets

100%

0%

90%

10%

33


32

FISCAL REGIME FOR EXTRACTIVE INDUSTRIES

Allocation of taxes between the budgets of various levels (general Budget Code rule)

Corporate income tax

State budget

Local budgets

100%

0%

100%

0%

Production royalty

100%

0%

100%

0%

Non-production royalty

State budget

Regional budget

Municipal(city, village)budgets

60%

25%

55%

10%20%

25%

Environmental tax

State budget

Local budgets

100%

0%

100%

0%

Transportation royalty; VAT; customs duties; excise tax; levy in the form of a special-purpose surcharge to the applicable natural gas tariff for consumers of all ownership forms

State budget

Regional budget,budget of thecity of Kyiv

50%

50%

75%

25%Production royalty for non-hydrocarbon minerals

20152014

20152014

35


34

State budget

Local governmentsbudgets

Municipalities(incl. district-level cities)

District budgets

Regional budgets

50%

25% 15%

25% 25%60%

Personal income tax

State budget

Regional budget,budget of the city of Kyiv

50%

50%

50%

50%

Special water use levy/ rent fee for special use of water

20152014

28.7%12,839,766.41

19,291,504.37

3.8%1,689,571.16

1,494,271.95

16.0%7,174,849.35

18,103,059.67

7.2%3,238,572.15

3,501,298.61

5.1%2,296,006.49

2,339,495.99

4.6%2,077,649.70

2,335,721.87

4.5%1,996,170.59

1,556,943.27

2.9%1,319,341.69

1.2%872,635.56

14.9%6,664,834.16

16,745,126.59

12.2%

27.2%

2.1%

25.5%

4.90%

3.3%

3.3% 2.2%

23.6%

6.7%

5,437,321.79

4,732,260.87

Dnipropetrovsk region

Dnipropetrovsk region

Poltava region

Poltava region

Kharkiv region

Kharkiv region

Sumy region

Sumy region

Luhansk region

Luhansk region



Donetsk region

Donetsk region

Lviv region

Lviv region

Other regions

Other regions

Chernihiv region

Chernihiv region

2015

2014

REGIONAL DISTRIBUTION OF REVENUES FROM THE EXTRACTIVE INDUSTRIES THOUS UAH

Extractive companies, whose provided information for reconciliation

Extractive companies, whose didn’t provide information for reconciliation

37


36

1. Shell Ukraine Exploration and Production I LLC2. Joint activity agreement of 06/10/2011 No 1330-1-4 – authorized entity Shell Ukraine Exploration and Production I LLC 338320653. Arabskyi energetychnyi alians IUEI LLC4. Eni Ukraiina LLC5. Zakhidgazinvest LLC6. Kub-gaz LLC7. Persha ukraiinska gazonaftova kompaniia LLC8. Vydobuvna kompaniia Ukrnaftoburinnia PrJSC9. Ukrgazvydobutok PrJSC10. Prom-Energoproduct LLC11. Representation office Regal Petroleum Corporation Limited (without legal entity right)12. Tysagaz LLC13. Pari LLC14. Kashtan Petroleum Joint Venture15. Joint Venture Ukrkarpatoil LLC16. Joint activity agreement of 21/07/1997 No 23-3/97-84Б-97 – authorized entity Gaz-MDS LLC 2425355617. Ukrtransgaz PJSC18. Zakhidnadraservis LLC19. State Enterprise Ukrspetszamovlennia LLC20. Pryrodni Resursy PrJSC21. Skhidnyi Geolohichnyi Soiuz LLC22. Joint activity agreement of 19/08/2002 No 85/2002 – authorized entity Skhidnyi Geolohichnyi Soiuz LLC 3242628923. Geologichne biuro Lviv LLC24. Prykarpatska energetychna kompaniia LLC25. Horyzonty LLC26. Ukrtransnafta PJSC27. Naftogaz of Ukraine National Joint-Stock Company28. Ukrgazvydobuvannia PJSC29. Poltavska gazonaftova kompaniia Joint Venture30. Enerhoservisna kompaniia Esco-Pivnich LLC31. Naftogazvydobuvannia PrJSC32. Ukrnafta PJSC

1. State Joint-Stock Company Chornomornaftogaz PJSC2. Joint Venture Boryslavska Naftova Kompaniia LLC3. Energiia-95 LLC4. Plast PrJSC5. National Joint-Stock Company Nadra Ukraiiny PJSC6. Ukrnaftogazinvest LLC7. Ukraiinska burova kompaniia LLC8. Praim-Gaz LLC9. Makkom-grup LLC10. Nadragaz LLC11. Ukristgaz LLC12. Bogorodchanynaftogaz LLC13. Nadra Geotsentr LLC14. Joint activity agreement of 29/06/2004 No 612 – authorized entity Vyrobnycho-komertsiina firma Dion LLC 2443067915. Joint activity agreement of 10/06/2002 No 3 – authorized entity Karpatygaz LLC 3016234016. Joint activity agreement of 25/04/2003 No 147 – authorized entity Naftogazrembud-1 LLC 3379946317. Joint activity agreement of 24/12/1997 No 999/97 - authorized entity Naftogazovydobuvne upravlinnia Poltavanaftogaz of Ukrnafta PJSC 2252591518. Joint activity agreement of 28/11/2000 No 1-Д21/008/2000 – authorized entity Poltava branch of Devon CJSC 2600244219. Joint activity agreement of 04/02/2004 No 60 – authorized entity Firma Has LLC 2123733820. Joint activity agreement of 24/03/2004 No 493 – authorized entity Karpatygaz LLC 3016234021. Joint activity agreement of 26/12/2003 No 122 - authorized entity Sakhalinske LLC 3233727822. Gravelit-21 LLC (34013604) responsible for taxes maintenance and paymants provision to the budget during implementation JAA23. Joint activity agreement of 15/09/2004 No 927 – authorized entity Tsefei LLC 3286974924. Joint activity agreement of 19/01/1999 No 35/4 – authorized entity Ukrnafta PJSC 13539025. Joint activity agreement of 28/01/2008 No 35/21 – authorized entity Kashtan Petroleum LTD Joint Venture 2370337126. Joint activity agreement of 07/09/2001 No 4 – authorized entity Gals-K PrJSC 3156642727. Joint activity agreement of 13/10/2004 No 1747 – authorized entity Karpatnadrainvest LLC 3178945328. Joint activity agreement of 19/05/2000 No 17-2000 – authorized entity Sirius-1 LLC 3223957729. Nadra Geotsentr LLC (34763705) responsible for taxes maintenance and paymants provision to the budget during implementation JAA No 265-12 of 23/11/2007 with Gazopromyslove upravlinnia Kharkivgazvydobuvannia

Oil and gas

33. ArcelorMittal Kryvyi Rih PJSC34. Vilnohirsk GZK Branch of United mining and chemical company State Enterprise35. Irshansk GZK Branch of United mining and chemical company State Enterprise36. United mining and chemical company State Enterprise37. Northern GZK PrJSC38. Bilanivskyi GZK LLC39. Ingulets GZK PrJSC40. Poltavsky GZK PrJSC41. Central GZK PrJSC42. Yerystivskyi GZK LLC

30. Southern GZK PJSC31. The foreign investment enterprise in the form of PrJSC Zaporizhzhia iron ore industrial complex32. Kryvyi Rih iron ore industrial complex PJSC33. Evraz Sukha Balka PrJSC34. Ordzhonikidze GZK PJSC35. Marganets GZK PJSC36. Mizhrichenskyi GZK LLC

43. Krasnoarmiiskvuhillia State Enterprise44. Lvivvuhillia State Enterprise45. Mine Pivdennodonbaska No 3 named after M. S. Surgaia State Enterprise46. Shakhtoupravlinnia Pivdennodonbaske No 1 State Enterprise47. Lysychanskvuhillia PJSC48. Mine Nadiia PJSC49. Selydivvuhillia State Enterprise50. Toretskvuhillia State Enterprise51. Krasnodonvuhillia PrJSC52. Vuhilna kompaniia Krasnolymanska State Enterprise53. Mine Bilozerska ALC54. DTEK Dobropilliavuhillia LLC1

55. DTEK Pavlogradvuhillia PrJSC56. DТЕК Rovenkyantratsyt LLC57. DTEK Sverdlovantratsyt LLC58. DTEK Mine Komsomolets Donbasu PrJSC59. Shakhtoupravlinnia Pokrovske PJSC

37. Shakhtoupravlinnia Donbas PJSC38. Mine named after O.F. Zaciadko PJSC39. Snizheantratsyt State Enterprise40. Artemvuhillia State Enterprise41. Torezantratsyt State Enterprise42. Makiivvuhillia State Enterprise43. Orendne pidpryiemstvo Mine Zhdanivska PJSC44. Donetska vuhilna energetychna kompaniia State Enterprise45. DV naftogazovydobuvna kompaniia LLC46. DTEK Dobropilliavuhillia LLC1

! Extractive companies, whose provided information for reconciliation

Extractive companies, whose didn’t provide information for reconciliation

Metal ores

!

Coal

1 DTEK Dobropilliavuhillia LLC provided information only for 2014

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20142015

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EITI UKR · 3 Cost of imported products, million USD Russia Germany Norway Hungary Other країни Russia Germany Norway Other ЄС країни ЄС 6.1 3.5 2.1 3.2 1.5 2014 14.5