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Kiev tax hike prompts pause for gas company

More work from JKX Oil and Gas "in due course."
By Daniel J. Graeber Follow @dan_graeber Contact the Author   |   Aug. 4, 2014 at 9:13 AM

LONDON, Aug. 4 (UPI) -- Emergency budget legislation enacted by the Ukrainian government means a new tax burden needs careful review, JKX Oil and Gas said Monday.

JKX said new budget measures passed by the Ukrainian government means higher taxes for the oil and gas industry in the country. The most significant, it said, was a move to nearly double the tax on gas production to close to 55 percent.

"In light of this significant change to the fiscal environment for independent oil and gas operators in Ukraine, the board of JKX is evaluating the impact on its ongoing investment program carefully, and will be taking operational and financial measures to protect the interests of the company and its shareholders," the company said in an e-mailed statement.

Ukraine is one of the Eastern European countries rich in shale natural gas. JKX said its production in Ukraine for 2013 averaged 9,731 barrels of oil equivalent per day, an 18 percent increase from the previous year.

The country's Rudenkovskoye shale deposit, the company said in March, is the "largest untapped gas resource" in the country.

JXK offered no information about its plans moving forward or the status of current operations in Ukraine.

"A further announcement will be made in due course," the company said.

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