ENW Enwell Energy Plc

By Joe Hoppe

Enwell Energy PLC shares fell Monday after it said the Ukrainian government has imposed temporary, partial gas-price regulation to support certain production of foods.

Shares at 0827 GMT were down 3.8 pence, or 11% at 32.4 pence.

The oil-and-gas company, which has operations in the country, said all independent gas producers in Ukraine must sell up to 20% of their natural-gas production until April 30 at a price set at its cost of sales, plus a margin of 24%, and existing production taxes.

The gas will be sold to specified producers of important food products, including flour, milk and bread, to reduce their energy costs, the company said.

The temporary program will support food production and moderate food prices as gas prices have been high in Ukraine, though the company said the regulation presents serious inconsistencies with market rules established during the country's deregulation of gas supplies in 2015.

"The imposition of this gas price regulation, albeit on a temporary basis, is a very concerning situation for the independent gas producers in Ukraine, and indeed for the investment climate in Ukraine generally. However, we recognize the underlying social issues that this scheme is intended to address, and will monitor its impact on the market and our business," Chief Executive Sergii Glazunov said.

Write to Joe Hoppe at joseph.hoppe@wsj.com

(END) Dow Jones Newswires

January 17, 2022 03:48 ET (08:48 GMT)

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