For 12M, 2020, the companies of Smart Energy Group paid in total UAH 948.5 mln in taxes, including UAH 430.3 mln fee for subsoil use to the budgets of all levels. Thus, UAH 21.5 mln of subsoil tax were paid to the local budgets.
The tax payments by Smart Energy companies decreased by 27% y-o-y. The main reason remains fall of gas price that started a year before and impacted the key tax payments such as income tax, value added tax and subsoil tax. The production growth by 8.6% y-o-y and gradual renewal of gas price growth, being observed since H2, 2020, just partially mitigated the impact of this factor.
“In autumn last year the price for gas started its slow growth. However, that influenced insignificantly the financial results for 2020 because of the fact that for nearly three quarters the price was the lowest for the last several years. The previous steps of the government in order to support gas producers such as decrease of subsoil tax and stimulating 12% subsoil rate for new wells had positive influence on results 2020 because of new drillings. However, unfortunately, we haven’t seen any new movements in this direction,” Oleksiy Zayets, FCO of Smart Energy Group, commented.
Besides paying all taxes for the reported period, the companies of Smart Energy Group allocated complementarily UAH 3.56 mln for needs of the communities on the territories of which they operate. This fund includes UAH 776 thousand that Arkona Gas-Energy paid to the budget of Poltava Oblast Council within the bilateral agreement. The money was used for school construction in Zavodske town (Poltava oblast).
The charitable funds were allocated by other companies of the Group in the following way:
- The Representative Office of Regal Petroleum Corporate Limited allocated UAH 1.79 mln. In the context of fight against spreading and consequences of coronavirus COVID-19 the majority was sent to Lokhvytsia District Hospital.
- Ukrgazvydobutok gave UAH 670 thousand. This money was used for renovation of monuments, devoted to the heroes of the Second World War, for dyke reinforcement in Mokra Rakytna village, for arranging transport for local dwellers, for improving conditions at the specialized agencies etc.
- Prom-Energo Product allocated UAH 321 thousand. The majority was used for completion the heating system repair in Ternivske educational complex and repair of a school bus.
The main criterium of selection of projects for the participation of Smart Energy Group is the benefit for as many people as possible. Thus, most of them are related to the education and medicine that got a special significance in 2020 in the context of pandemic COVID-19. Besides regular help to the communities of Kharkiv and Poltava oblasts, the companies together with the Charitable Foundation in Honour of Intercession of the Most Holy Mother of God of Vadym Novynskyi purchased and delivered express tests and test systems, medical masks, artificial respirating units, protective overalls for medical workers, protective screens and biosafety cabinets to the regional hospitals, totalled USD 2 mln, in March-April last year.
Smart Energy is a part of Smart-Holding and is in charge of implementing exploration projects, commercial development of the hydrocarbon deposits. It is ranked in top 5 biggest private gas producers of Ukraine, producing over 1 mln m3 of gas per day in total.
Oil & Gas business block of Smart Energy is represented by gas producing Ukrgazvydobutok (Kharkiv region) and Enwell Energy, a listed British company having assets in Poltava (the Representative Office of Regal Petroleum Corporation Limited and Arkona Gas-Energy LLC) and Kharkiv regions (Prom-Energo Product).