Electricity

Ukrinterenergo, the Ukrainian state intermediary on all electricity export contracts, resumed electricity sales in April 2008 to Poland, now at the significantly higher price of USD 55 per MWh, a 96% increase since initial sales were interrupted in Sept. 2007.

Ukraine and Moldova have agreed on upping the price of Ukrainian exported electricity to Moldova in the next year to the Ukrainian domestic market price.

According to the announcement made by Naftogas, the company intends to cut gas supplies to all Combined Heat and Power Plants (CHPP) which can not provide full payments for the consumed gas, including Kyivenergo [KIEN].

Ukraine resumed electricity export to Poland starting April 14, which was stopped in October 2007. According to Ukrinterenergo, state intermediary in electricity export, it has a signed contract with Polish company Zomar S.A. on electricity export until 2015. During April 14 – April 30 2008 Ukraine exported only 8.4% less than in April 2007.

The privatization of oblenergos Poltavaoblenergo [POON], Lvivoblenergo [LVON], Prykarpattyaoblenergo [PREN], Chernigivoblenergo [CHEON], Sumyoblenergo [SOEN] and Odesaoblenergo [ODEN] has officially been halted by State Property Fund (SPF) head Andriy Portnov. The decision to stop proceedings was supported by the cabinet and Prime Minister Yulia Tymoshenko.

The INNEX stock exchange, which is to hold a second auction on the privatization of the oblenergos by organizing the sale of a 26.98% stake in Lvivoblenergo [LVON], removed an announcement from its website on the cancellation of the auction in question. The 25% stake in LVON will be sold as one lot, with a starting price of USD 110mln or USD 2.09 per share, the average price for the stock during the last six months.

The privatization of a 25% stake in electricity distribution company Poltavaoblenergo [POON] was prohibited by a Ukrainian regional court May 7. The Ukrainian Interbank Currency Exchange (UICE), which was to hold the auction of 25% of POON May 14, had already registered three potential buyers that applied to participate in the auction.

VS Energy, the main shareholder in electricity distribution company Odesaoblenergo [ODEN], has announced its plans to buy four gas turbines worth USD 225 mln from Siemens, to be installed on the newly built power station in the portside city of Ismail in the Odessa oblast.

Motor Sich [MSICH BUY], the sole Ukrainian manufacturer of engines for helicopters and jet airplanes, has reported 1Q08 net sales of USD 87 mln, which is 51.2% more than its performance in the same period last year.

Electricity generation and distribution company KIEN has reported its 1Q08 net sales up 21% YoY amounting to USD 354.4 mln.