OREANDA-NEWS. Naftogazvydobuvannya (NGV) issued UAH 1 billion in domestic bonds. The bond coupon is fixed at the rate of 14% per annum. The company will use the proceeds to increase natural gas and gas concentrate production volumes.

Ordinary registered A, B, and C series bonds will be available on the Dnipropetrovsk Perspektiva Stock Exchange for one year. VTB Bank is the underwriter of the bond issue. The circulation period will be to 18 February 2017.

NGV will use the proceeds to finance its investment program, which in 2014 will exceed UAH 1.4 billion.

Over UAH 700 million will be used to pay for the construction and fitting-out of new gas wells. The company will also complete well workovers that are currently in progress and invest over UAH 70 million into the commissioning of the Olefirovska gas preparation plant, which will be one of its largest infrastructure projects in 2014. NGV will continue the construction of gas pipelines, electricity transmission lines and access roads. Over UAH 50 million will be invested in a large-scale geological survey that will include the introduction of methods for surveying and exploring hydrocarbons not previously used in Ukraine.

These plans will allow the company to increase its gas production to 1 billion cubic meters (vs. 506 million cubic meters in 2013) and gas condensate production to 27,000 tonnes (vs. 20,000 tonnes in 2013).

“NGV's reliable operation and good financial standing give it access to the most efficient fundraising instruments,” said Igor Schurov, General Director of Naftogazvydobuvannya. “The issuance of the bonds will speed up the achievement of the goals set by our shareholders of increasing production and improving efficiency.”

“The objective of DTEK's oil and gas business is to fully satisfy SCM Group's demand for natural gas, which is 6 billion cubic meters, by 2020,” said Maxim Timchenko, DTEK's CEO. “The implementation of Naftogazvydobuvannya's investment program for 2014 will be our first important step to reach this goal.”