Expert explains how government plans to reduce gas price for population

The government expects to reduce by 10-15% the price of natural gas for the households by eliminating the national oil and gas holding company Naftogaz of Ukraine from the gas supply chain for the needs of the population and obliging Ukrgazvydobuvannia, the state-owned extracting company, to sell gas directly to regional marketing companies.

Read alsoUkraine seeking partner to manage GTS, extending deadline for applications"The next move is likely to be the removal Ukrgazvydobuvannia from under control of a group of 'bold' oil and gas reformers with the subsequent sale of gas without anyone else's participation. According to the most conservative preliminary estimates, Team Groysman are planning to reduce gas price for the population by 10-15%," an expert in the energy sector, Director of Energy Programs of the Center for World Economy and International Relations Volodymyr Zemlianskiy wrote on Facebook.

According to the expert, direct gas sales from Ukrgazvydobuvannia to regional marketing companies will allow reducing prices for the households to around UAH 6 per cubic meter instead of raising them to UAH 8.

"Such a price will be fixed until the share of subsidized households is reduced to 25%," Zemlianskiy said.

As UNIAN reported earlier, Ukraine in 2017 compared with 2016 increased own production of natural gas by 3.1% - up to 20.8 billion cubic meters. The state-owned Ukrgazvydobuvannia, which is part of the Naftogaz holding, producing gas in Kharkiv and Poltava regions, increased output by 4.8% to 15.3 bcm last year. At present, the company is implementing the 20/20 Program, which envisages the annual output boost up to 20 bcm by 2020. The implementation of this program requires investment estimated at UAH 110 billion.