Naftogaz Trading resumes gas trading on stock exchange platforms

LLC “Gas Supply Company “Naftogaz Trading” (the “Company”) has submitted letters of proposal for cooperation to all commodity exchanges that received licenses of the National Securities and Stock Market Commission (the “NSSMC”). In particular, it is necessary for resumption of gas exchange trading which has been suspended since the declaration of the martial law status in Ukraine.

Expanding cooperation with the licensed exchanges will allow to:

  • diversify natural gas sales markets;
  • provide opportunities to participate in the bids solely by the bidders of natural gas market of Ukraine which passed the compliance check of commodity exchanges.

The approach of natural gas trading at the licensed exchanges allows to minimise the reputation risks, risks on potential allegations of non-transparent pricing for natural gas by the Company and Naftogaz Group under a non-competitive or non-transparent mechanism.

 Also, Naftogaz Trading has recently entered into a cooperation agreement with one more licensed exchange – Ukrainian Interbank Currency Exchange PJSC (the “UICE”).

The document stipulates that the UICE will provide a platform for e-commerce of:

  • natural gas;
  • other commodities;
  • the company’s bonds;
  • special bonds secured by receivables of enterprises;
  • financial instruments, including swaps, options, forward and reverse repos;
  • derivative financial instruments (derivatives);
  • etc.

 Also, it provides for the creation of conditions to attract international traders to participate in the bids.

The Parties undertook to adhere to high international standards, in particular, in terms of preventing and combating money laundering legalisation, financing of terrorism and proliferation of mass destruction weapons), including by carefully identification of each bidder.

In addition, the UICE shall ensure strict compliance with the laws of Ukraine and rules of activities of the bidders of the market in financial instruments stipulated by the provisions of Directive 2014/65/EU dated 15 May 2014 on markets in financial instruments (MIFID II).

Naftogaz Trading intends to offer the UICE the commodities already known to the market in the natural gas trade section, and drafts new proposals on supply periods and price determination. The first bids of the company’s resources are planned to take place already this April.

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