Merry Christmas!

Happy holidays and here's to a greener and cleaner 2012 :)

Tentative New Climate Deal Reached In Durban

Greetings everyone from Ukraine!  Well what can I say, there was a surprise announcement late this weekend that a platform had been agreed to extend the Kyoto Protocol in principle.  Although the agreement is rudimentary at best and leaves much room for clarification on how to implement a future legally binding treaty, it's more than the zero result most people anticipated coming into the conference.  It remains to be seen if the USA - a sadly visible and increasingly isolated leader in the anti-climate change movement - will be shamed and cornered by the rest of the world to get its act together finally, and if China goes along too.  One thing that is clear, however, is there is a glimmer of hope where before there was only darkness.

As reported on http://www.ens-newswire.com/ens/dec2011/2011-12-11-01.html

DURBAN, South Africa, December 11, 2011 (ENS) - As dawn broke over Durban this morning, climate negotiators agreed to launch a new legally-binding treaty limiting greenhouse gas emissions that would apply to all 194 member governments of the UN Framework Convention on Climate Change. They also approved a second commitment period for the existing Kyoto Protocol and the launch of the Green Climate Fund.

The final package of agreements, known as the Durban Platform, was reached after intense negotiations that extended until 5 am this morning, more than a day past the official end of conference. 

UN Secretary-General Ban Ki-moon today welcomed the outcome, saying these decisions represent "a significant agreement that will define how the international community will address climate change in the coming years. 

"Taken together, these agreements represent an important advance in our work on climate change," Ban said, calling on countries to "quickly implement these decisions and to continue working together in the constructive spirit evident in Durban." 

The new "agreed outcome with legal force" covering all countries must be negotiated by 2015 and take effect by 2020 at the latest.

It must ensure that countries take measures sufficient to meet the goal agreed at last year's climate conference of keeping global temperature rise below two degrees Celsius over pre-industrial levels, which many scientists say could avert the worst impacts of climate change. 

Work on this instrument will start immediately under a new group called the Ad Hoc Working Group on the Durban Platform for Enhanced Action.

Ban praised the agreement to establish a second commitment period of the Kyoto Protocol from January 1, 2013, the day after the first commitment period expires. He said it will "increase certainty for the carbon market and provide additional incentives for new investments in technology and the infrastructure necessary to fight climate change."

Parties to this second period will turn their economy-wide targets into quantified emission limits or reduction targets and submit them for review by May 1, 2012.

"This is highly significant because the Kyoto Protocol's accounting rules, mechanisms and markets all remain in action as effective tools to leverage global climate action and as models to inform future agreements," said Christiana Figueres, executive secretary of the UN Framework Convention on Climate Change.
Countries also agreed to implement the Cancun Agreements, which were created at last year's conference in Mexico. The new measures include setting up a Technology Mechanism that will promote access by developing countries to clean, low-carbon technologies, and establishing an Adaptation Committee that will coordinate adaptation activities on a global scale.

Ban applauded the launch of the Green Climate Fund and said he was gratified that a number of countries signalled their intent to contribute to it. The Fund was created last year to help developing nations protect themselves from climate impacts and build their own sustainable futures, but had not been launched. Ban had urged developed countries throughout the two-week conference to inject the necessary capital to kick-start it.
"This means that urgent support for the developing world, especially for the poorest and most vulnerable to adapt to climate change, will also be launched on time," said Figueres.

Achim Steiner, executive director of the UN Environment Programme, is encouraged by the agreements but said the real-world impact on the planet's climate is still uncertain.

"The big question many will ask is how this will translate into actual emission reductions and by when?" Steiner said. "Whatever answer will emerge in the coming months, Durban has kept the door open for the world to respond to climate change based on science and common sense rather than political expediency."

The latest "Bridging the Emissions Gap" report, coordinated by UNEP with climate modeling centers around the world, emphasized in November that the best available science shows that global greenhouse gas emissions need to peak before 2020.

The key question of the Durban outcome, said Steiner, is whether what has been decided will match the science and lead to a peaking of global emissions before 2020 to maintain the world on a path to keep a temperature increase below two degrees Celsius.

The United States has not signed on to the Kyoto Protocol, concerned that it does not cover high-emitting developing countries such as China and India. A big question in Durban was whether the United States, China and India would agree to be legally bound to limit their greenhouse gas emissions. In the final vote, all three countries did agree.

Although the Durban Platform sets the stage for a legally-binding agreement that does cover all countries, the U.S. supported it only reluctantly.

U.S. Climate Envoy Todd Stern told delegates, "This is a very significant package. None of us likes everything in it. Believe me, there is plenty the United States is not thrilled about." But he said the agreement formalizes important advances that would fall by the wayside if it had been rejected.

"We made it. EU's strategy worked. We got a roadmap that marks a breakthrough for international fight against climate change," tweeted EU Climate Commissioner Connie Hedegaard of Denmark, who chaired the 2009 UN climate conference in Copenhagen.

On Saturday, as the talks went into overtime, Hedegaard said of the intense pressure to reach agreement, "Finally we are getting to the crunch issues. And making progress. The time pressure is almost physically felt in the room. Nerve-breaking!"

Xie Zhenhua, head of the Chinese delegation, said, "The implementation of the Cancun Agreements and the Durban Outcome will not be achieved in a short run. A heavy load of work ahead on the post-2020 arrangement needs to be done in order to enhance the implementation of the Convention."

"The lack of political will is a main element that hinders cooperation on addressing climate change in the international community," he said. "We expect political sincerity from developed countries next year in Qatar."
The world's largest environmental group, the International Union for the Conservation of Nature, expressed optimism over the progress made in Durban.

Stewart Maginnis, IUCN's director of environment and development, said, "We had anticipated that Durban would be where the developed world would raise the bar on their current ambitions and all countries would purposefully commit to the development of a credible roadmap for deep and wide ranging targets for the comprehensive reduction of greenhouse gas emissions. This has been achieved, and steps have been laid out for a new agreement to be put in place by 2015."

"A new spirit of compromise spanning the developed and developing countries is an encouraging step forward," said Maginnis.

But other environmental groups warned that the Durban Platform is just another delay of effective climate action.

Greenpeace International Executive Director Kumi Naidoo said, "The grim news is that the blockers led by the U.S. have succeeded in inserting a vital get-out clause that could easily prevent the next big climate deal being legally binding. If that loophole is exploited it could be a disaster. And the deal is due to be implemented 'from 2020' leaving almost no room for increasing the depth of carbon cuts in this decade when scientists say we need emissions to peak."

"Right now the global climate regime amounts to nothing more than a voluntary deal that's put off for a decade," said Naidoo. "This could take us over the two degree threshold where we pass from danger to potential catastrophe."

Samantha Smith, leader of WWF's global climate and energy initiative said, "Governments did just enough to keep talking, but their job is to protect their people. They failed to do that here in Durban today. Science tells us that we need to act right now - because the extreme weather, droughts and heat waves caused by climate change will get worse."

"Some countries here, like the United States, showed they were not interested in supporting an ambitious outcome in Durban. The U.S. - afraid of the politics at home - fought over a few words, but missed the bigger story: limiting dangerous climate change," Smith said.

"Overall, the responsibility for this lies with a handful of entrenched governments - like the U.S., Japan, Russia, and Canada - who have consistently resisted raising the level of ambition on climate change. This is what brought us to this point.

"It is clear today that the mandates of a few political leaders have outweighed the concerns of millions, leaving people and the natural world we depend on at risk," said Smith. "Catastrophe is a strong word but it is not strong enough for a future with four degrees of warming."

The next annual UNFCCC Climate Change Conference is scheduled for November 26 through December 7, 2012 in Qatar. 

Kind regards from Kiev,
Jon

UNFCCC Webcast of Durban Conference of Parties, December 2011

Greetings from Kiev!

This week is a major week for emissions trading and battling climate change.  Nations from all over the world have gathered in Durban, South Africa to discuss the future of the Kyoto Protocol and carbon trading schemes.  The event is hosted by the United Nations Framework Convention on Climate Change, and addresses the future of CDM and JI under the Kyoto Protocol, as well as bilateral climate treaties that could arise after Kyoto's expiration in 2012.

You can find the podcast at the UNFCCC website to follow events on a rolling basis:  http://unfccc4.meta-fusion.com/kongresse/cop17/templ/play.php?id_kongresssession=4295&theme=unfccc

Kind regards
Jon

Largest Energy Deal of the Year Creates Largest Natural Gas Pipeline in USA

Greetings from Kiev!  As reported on world news services, the gas company Morgan Kinder (run by ex Enron chief Richard Kinder) made a cash and stock offer worth 21 billion dollars to buy El Paso Corp., another gas transit company... and this would result in a combined company having 107,000 kilometers of gas lines and becoming the single largest American pipeline operator.

The shift in company focus from exploration and production into gas transit would accomodate biogas as well, and could help instigate a nationwide shift from traditional fossil fuels to cleaner energy solutions.  For more information please see http://www.bloomberg.com/news/2011-10-16/kinder-to-buy-el-paso-for-21-1-billion-making-biggest-u-s-pipe-company.html

Kind regards,
Jon

Ukraine Green Awards

Greetings from Kiev!  This year's Green Awards in Ukraine will take place in November, with a ceremony and presentation of the best green projects in Ukraine this year.  If you would like to submit a project, learn more about green news, or show your support for alternative energy in Ukraine please see their link at http://www.greenawards.info/en

Cheers
Jon

U.S. Department of Agriculture Awards Grants To Fund Biomass & Biofuel Production

Last week the U.S. Secretary of Agriculture, Tom Vilsack, announced that 160 wood pellet producers in 41 states would start receiving grant money to produce biomass and biofuel components.  According to Secretary Vilsack this measure will create tens of thousands of new American jobs and provide fresh sources of clean energy to millions of Americans.

The funding will be awarded by the Bioenergy Program for Advanced Biofuels, a program dedicated to promoting manufacturers of biofuels from non-corn derived sources. For the full story please see http://bioenergy.checkbiotech.org/news/usda_awards_grants_biomass_and_biofuel_production

It will be interesting to see whether this news indicates the start of a new trend for different government agencies taking more proactive positions towards enhancing and subsidizing cleaner alternative energy in the USA -- a country that by most accounts trails global peers significantly in this regard.  With the current high unemployment levels in America currently, coupled with the country's high reliance on outdated fossil fuel energy production methods, linking the renewable energy sector to new jobs as a joint initiative makes a lot of sense.  Of course it will take a lot more than some USDA grant money to accomplish anything significant.  But the recent news from Secretary Vilsack represents a step in the right direction and hopefully signifies a growing new trend within both USDA and its sister agencies in Washington.

Kind regards from Kiev,
Jon

Green Energy News Website

Greetings from Kiev!  With the European and global markets under pressure from many fronts, it's nice to know that the green energy industry is proceeding with gusto.  From renewable energy vehicles, cool new devices and gadgetry, all the to large scale power generation, innovators across different continents are developing new commercially viable means to for humans to live in a more progressive way.

There are many green news websites out there that cover daily updates on what's happening in this space, but one that I recommend is http://www.green-energy-news.com.  Check out some of their stories about new electric cars and solar power if you have a moment -- it's a light introduction to where our future lives are headed!

Cheers,
Jon

Renewable Energy Business Investment Breaks Records

Greetings from Kiev! Global investment in renewable energy set a new record in 2010, according to a new analysis commissioned by UNEP's Division of Technology, Industry and Economics (DTIE) from Bloomberg New Energy Finance. Investment hit $211 billion last year, up 32 percent from a revised $160 billion in 2009, and nearly five and a half times the figure achieved as recently as 2004.

The following article is an excerpt from Renewable Energy World Network Editors, and is available at: http://www.renewableenergyworld.com/rea/news/article/2011/08/renewables-investment-breaks-records

The document, Global Trends in Renewable Investment 2010, an Analysis of Trends and Issues in the Financing of Renewable Energy, reports that the record itself was not the only eye-catching aspect of 2010. Another was the strongest evidence yet of the shift in activity in renewable energy towards developing economies. Financial new investment, a measure that covers transactions by third-party investors, was $143 billion in 2010, but while just over $70 billion of that took place in developed countries, more than $72 billion occurred in developing countries.

This is the first time the developing world has overtaken the richer countries in terms of financial new investment - the comparison was nearly four-to-one in favour of the developed countries back in 2004. It is, however, important to note that in two other areas not included in the financial new investment measure, namely small-scale projects and research and development, developed economies remain well ahead.

Nonetheless, renewable energy's balance of power has been shifting towards developing countries for several years. The biggest reason has been China's drive to invest: last year, China was responsible for $48.9 billion of financial new investment, up 28 percent from 2009 figures, with dominance in the asset finance of large wind farms. But the developing world's advance in renewables is no longer a story of China and little else. In 2010, financial new investment in renewable energy grew by 104 percent to $5 billion in the Middle East and Africa region, and by 39 percent to $13.1 billion in South and Central America.

The developing world - at least outside its most powerful economies - may not be able to afford the same level of subsidy support for clean energy technologies as Europe or North America. It does, however, have a pressing need for new power capacity and, in many places, superior natural resources, in the shape of high capacity factors for wind power and strong solar insolation. Furthermore, the developing world is also starting to host a range of new renewable energy technologies for specific, local applications. These range from rice-husk power generation to solar telecommunications towers and are becoming the technology of choice, not a poor substitute for diesel or other fossil-fuel power options.

A second remarkable detail about 2010 is that it was the first year that overall investment in solar came close to catching up with that in wind. For the whole of the last decade, as renewable energy investment gathered pace, wind was the most mature technology and enjoyed an apparently unassailable lead over its rival renewable energy power sources. In 2010, wind continued to dominate in terms of financial new investment, with $94.7 billion compared to $26.1 billion for solar and $11 billion for the third-placed biomass & waste-to-energy. However, these numbers do not include small-scale projects and in that realm, solar, particularly via rooftop photovoltaic installations in Europe, was completely dominant. Indeed, small-scale distributed capacity investment ballooned to $60 billion in 2010, up from $31 billion, fuelled by feed-in tariff subsidies in Germany and other European countries, the report finds. This figure, combined with solar's lead in government and corporate research and development, was almost enough to offset wind's big lead in financial new investment last year, the document concludes.

Furthermore, no energy technology has gained more from falling costs than solar over the last three years. The price of PV modules per MW has fallen by 60 percent since the summer of 2008, according to Bloomberg New Energy Finance estimates, putting solar power for the first time on a competitive footing with the retail price of electricity in a number of sunny countries. Wind turbine prices have also fallen - by 18 percent per MW in the last two years - reflecting, as with solar, fierce competition in the supply chain. Further improvements in the levelised cost of energy for solar, wind and other technologies lie ahead, posing a growing threat to the dominance of fossil fuel generation sources in the next few years.

RECORD INVESTMENT

Total investment in renewable energy in 2010 was $211 billion, up from $160 billion in 2009 and $159 billion in 2008. Within the overall figure, financial new investment - which consists of money invested in renewable energy companies and utility-scale generation and biofuel projects - rose to $143 billion, from $122 billion in 2009 and the previous record of $132 billion in 2008.

A sharper increase, however, has been evident in the other components of the total investment figure - namely small-scale distributed capacity, and government and corporate R&D. These investments jumped to $68 billion in 2010, from $37 billion in 2009 and $26 billion in 2008, reflecting mainly the boom in rooftop PV, but also a rise in government-funded R&D, as spending increased from 'green stimulus' measures announced after the financial crisis.

The momentum of clean energy investment over recent years has been strong, but there have been many jolts and bumps along the way. These have included the biofuel boom of 2006-2007 and the subsequent bust, resulting in a fall in financial new investment in that sector from a peak of $20.4 billion in 2006 to just $5.5 billion last year; and the impact of the financial crisis and recession on Europe and North America. Financial new investment in renewable energy was significantly lower in 2010 in both Europe and North America, although this setback was more than outweighed by growing investment in China and other emerging economies, and in small-scale PV projects in the developed world.

The shift in investment between developed and developing countries over recent years shows that developed countries in 2010 retained a huge advantage in small-scale projects, but not what the authors define as financial new investment. In 2010, developing countries edged narrowly ahead of developed countries in terms of financial new investment for the first time. In 2007, developed economies still had an advantage of more than two-to-one in dollar terms, but the recession in the G-7 countries and the dynamism of China, India, Brazil and other important emerging economies has transformed the balance of power in renewable energy worldwide, leading to big changes in the location of IPOs and manufacturing plant investments by renewable energy companies.

Wind was the dominant sector in terms of financial new investment (though not of small-scale projects, as noted above) in 2010, with a rise of 30 percent to $95 billion. On this measure of investment, other sectors lagged far behind. Although the number of GW of wind capacity put into operation last year was lower than in 2009, the amount of money committed was higher. This reflected decisions to invest in large projects from China to the US and South America, a rise in offshore wind infrastructure investment in the North Sea, and the initial public offering (IPO) in November of Italy's Enel Green Power, the largest specialist renewable energy company to debut on the stock market since 2007.

In terms of venture capital and private equity investment, wind came a creditable second, with a figure of $1.5 billion last year, up 17% on 2009. However, solar stayed ahead as the most attractive destination for early-stage investors, its $2.2 billion figure coming after a 30% gain year-on-year. The positions of the two technologies were reversed again in terms of public markets investment, with wind boosted by the Enel Green Power flotation, and also some healthier figures for investment in 2010 in quoted companies specialising in biofuels, biomass and small hydropower.

Asset finance of utility-scale projects is the dominant figure within financial new investment. Wind mega-bases in China continued to receive billions of dollars of funding, while large-scale projects in Europe attracted important support from multilateral development banks, notably European Investment Bank (EIB) debt for the Thornton Bank project off the coast of Belgium. U.S. wind farm investment owed much to the treasury grant program, introduced in 2009 but due to expire at the end of 2011.

INVESTMENT IN 2011

Given the rush to complete a number of big investment transactions in the closing weeks of 2010, in some cases to "catch" attractive subsidy deals before they expired, it was little surprise that activity in the first quarter of 2011 was relatively subdued, the study finds. Financial new investment totalled $29 billion, down from $44 billion in the fourth quarter of last year and lower than the $32 billion figure for the first quarter of 2010.

In asset finance, the biggest reductions in terms of absolute dollar figures came in US wind and European solar. The brightest spots of January-March 2011 were Chinese wind, up 25 percent on the same quarter of 2010, and Brazilian wind, which saw its investment level double from a year earlier.

Key projects going ahead included the 211-MW IMPSA Ceara wind auction portfolio and the 195-MW Renova Bahia portfolio, both in Brazil, and the 200-MW Hebei Weichang Yudaokou wind farm in China. In Europe, there were several large offshore wind infrastructure commitments, including the Dan Tysk project off Germany, the Skagerrak 4 project off Denmark, and the Randstad project off the Netherlands.

In public market investment, transactions included a $1.4 billion share sale by Sinovel Wind in China, and a $220 million offering by solar manufacturer Shandong Jinjing Science & Technology, also in China.

New Report Shows How Energy Choices by U.S. States Impacts Public Health and Economy

Greetings!

A new report, Western Grid 2050: Contrasting Futures, Contrasting Fortunes, outlines how energy choices in eleven Western states over the coming decades will impact human health and the economy.  The 165 page report suggests that a Business As Usual (BAU) scenario will evolve with higher electricity bills and U.S. businesses becoming disadvantaged in the world marketplace.

With domestic energy infrastructure investment projections exceeding $200 billion for the next 19 years, regardless whether green energy or traditional fossil fuels, it makes sense to direct more focus toward clean energy -- in large part because traditional fossil fuel infrastructure already exists.

According to the report, future electricity sector development will arise from energy efficiency mandates (that will drive down use), renewable portfolio standards and renewable energy credits (that help push in favor of clean energy).

However, utilities (and other electricity providers in retail choice geographic areas) will continue to exert considerable influence on how the nation’s energy dollars are spent – whether maintaining the existing plant and transmission status quo, or investing in technologies that drive energy savings, favor clean energy production, and provide more multifaceted grid operations such as smart meters, lithium batteries, distributed generation and home area networks.

A full copy of the report is available at:  http://www.cleanenergyvision.org/wp-content/uploads/2011/08/WG2050_final_rev082211.pdf


Kind regards
Jon

Renewable Energy Group files for $100 Million IPO

Greetings from Kiev!  The renewable energy sector has made several successful IPOs this year on different international stock exchanges.  The area is heating up and developing into a more mature capital markets topic.  Among the different green energy industries, biodiesel is one of the most actively developed fields that competes for the future of how transportation fuel is delivered to commercial and personal vehicles.  The following article is from Reuters, showing yet another example of how new green companies can successfully tap into the international capital markets for fundraising.  Original link can be found at http://www.reuters.com/article/2011/07/18/idUS211061764820110718.

Biodiesel maker Renewable Energy Group files for $100M IPO

This year has ushered in a wave of biofuel IPOs, from Solazyme, to Gevo to Kior. The latest is biodiesel maker Renewable Energy Group, which on Monday filed to raise up to $100 million in an IPO on the Nasdaq under the symbol REGI.


In contrast to the other next-gen biofuel startups that have gone public this year, Iowa-based Renewable Energy Group is an older firm formed out of a consolidation of several firms, and bills itself as the largest biodiesel producer in the country. Renewable Energy sold close to 68 million gallons of biodiesel, or 22 percent of the U.S. overall production, in 2010, according to the company’s filing. Five million of the 68 million gallons came from plants operated by other companies.

Renewable Energy runs six biodiesel plants with a total capacity of 212 million gallons per year and owns five of them. It wants to use proceeds from the IPO primarily to buy a refinery in Illinois that it currently leases. The company also wants to expand its reach into making green chemicals and other types of feedstocks and biofuels, including algae oil.

Renewable Energy uses mostly animal fat, used cooking oil and “inedible corn oil” to produce biodiesel. These feedstocks are cheaper than using virgin vegetable oils such as soybean oil, the company said. In fact, the company shifted away from using soybean oil in 2009 because soybean oil had become a pricy feedstock and was eating into the company’s profit.

The company has shown growing revenues, generating $216.46 million in 2010, $131.5 million in 2009 and $85.45 million in 2008. Strong demand boosted the company’s sales for the first three months of this year to $100.1 million, up from $33 million in the same period a year ago. The company’s biggest customer is Pilot Travel Centers, which sells diesel and biodiesel to truck drivers, and which accounted for 29 percent of Renewable Energy’s revenues in 2010 and 24 percent in 2009.

At the same time, Renewable Energy Group isn’t profitable on a yearly basis, but has been on a quarterly basis. The company posted losses of $21.59 million in 2010, $68.86 million in 2009 and $15.88 million in 2008. But for the first quarter of this year, the company posted a net income of $3.74 million, up 21 percent from $3.08 million in last year’s first quarter.

The company has been around since 1996 and mostly operated refineries owned by others until recent years. It then embarked on a series of acquisitions and mergers for refineries. In 2010 alone, it merged with Blackhawk Biofuels and bought some or all of the assets of Central Iowa Energy, Tellurian Biodiesel, American BDF, and Clovis Biodiesel. And this year, Renewable Energy bought a Minnesota plant owned by SoyMor Biodiesel.

The biodiesel industry has relied mostly on state and federal tax incentives to compete. The industry experienced a downturn starting in 2008 partly because of taxes on U.S. biodiesel being exported to the European Union, the crashing economy, and high soybean prices. The implementation of the Renewable Fuel Standard (RFS) 2 by the U.S. Environmental Protection Agency, a federal renewable energy mandate put in place last year, gave the biodiesel industry a big boost in demand. Through RFS, the government is gradually increasing the amount of renewable fuels, from cellulosic ethanol or biodiesel, that the country needs to use every year until 2022.

New Car Designed To Run Entirely On Algae

Greetings!  The world of renewable energy may recently have made a step in a new direction... with a car that runs on micro algae biodiesel.  This week it has been reported that researchers claim to have accomplished this feat.  The article below, taken from the Deccan Herald, can be found at:  http://bioenergy.checkbiotech.org/news/car_runs_micro_algae_biodiesel

Researchers have claimed to have run a car on B-20 biodiesel derived from marine micro algae.

Under the New Millennium India Technology Leadership project (NMITLI), a regular diesel vehicle, Tavera, under full load condition, was successfully test driven on B-20 biodiesel (20 per cent biodiesel blend) on July 10, a top official of the Council of Scientific and Industrial Research (CSIR) said.

The project was initiated last year jointly by CSIR and the Ministry of Earth Sciences (MoES), along with researchers from nine institutions, including CSMCRI, IIT-Kharagpur, IICT-Hyderabad, NIOT-Chennai and NIO-Goa.

The biodiesel was prepared from mats of microalgae found growing naturally in the West coast of India by the Bhavnagar-based Central Salt Marine and Chemical Research Institute (CSMCRI).

The mileage derived from the test drive was 12.4 km, which is better than the normal average per litre of 10-11 km of the regular vehicles run on diesel, the official said.

“The aim of the project is to develop a scalable viable process for production of bio-fuel from marine algae. In the first step, road worthiness of B-20 marine micro algae biodiesel under full load conditions has been proven,” NMITLI coordinator Dr Vibha Malhotra told PTI on telephone.

“The next step would be to run vehicle under full load conditions on B-100 (neat biodiesel) marine micro algae biodiesel and to look at its economic viability,” she said.

“Although the demonstration aimed at proving road worthiness of micro-algal biodiesel, it remains to be seen whether such mat-forming marine micro algae can be cultivated inland or induced to grow rapidly and on large scale in the sea itself,” said CSMCRI Director Dr Pushpito Ghosh.

Investment company Jaspen Capital Partners acted as a transaction co-lead manager for the London Stock Exchange placement of 3 year Eurobonds for Agroton Public Limited (ticker: AGT PW). The notes have a face value of $50 million.

Investment company Jaspen Capital Partners acted as a transaction co-lead manager for the London Stock Exchange placement of 3 year Eurobonds for Agroton Public Limited(ticker: AGT PW) on July 12, 2011. The notes have a face value of $50 million; VTB Capital, Dragon Capital, UBS Investment Bank and Bank Zachodni WBK also were managers in the transaction.

Agroton, a publicly traded company on the Warsaw Stock Exchange, completed the placement of its debut $50 million, 3 years Eurobond issue with a coupon rate of 12.5% paid semi-annually. During the placement, demand from international investors (mainly Western European funds) exceeded the offered amount.

Agroton plans to utilize the Eurobonds proceeds to refinance existing debt, increase capacities of grain and oilseeds silos, increase its farmed land bank and to ultimately purchase its land bank after the moratorium on sales of agricultural land is lifted in Ukraine.

Andrey Supranonok, CEO of Jaspen Capital Partners, stated “Agroton’s recent Eurobonds placement is one of the largest transactions to date this year for a Ukrainian company on the international capital markets. The interest level demonstrated by fixed income investors, despite a global decrease in risk appetite stemming from the Greek and European debt predicament, shows firm market confidence in Agroton’s management and strategic direction. This show of confidence during a time of uncertainty essentially restates the original positive view held by equity investors during the company’s Warsaw Stock Exchange debut last November. It furthermore indicates a continued desire for Ukrainian deals from the international investment community, sending a positive signal to similarly situated companies considering additional transactions this year.”

Ukraine Parliament Supports Green Tariff With New Legislation Addressing Future Uncertainty

In recent years there has been equal optimism and skepticism about the long-term impact of Ukraine's Green Tariff for the country's alternative energy producers and investors. While almost everyone is pleased with the nominal tariff rates and the potential revenues earned thereby, several market observers have raised prior questions about the feasibility of maintaining these tariffs in the future under the current energy market mechanism. The government has made a recent legislative move to address these questions directly, as reported in the article below by Cameron McKenna law firm. We will see what the market reaction is, at minimum this news shows that the government is concerned about promoting green energy investment in Ukraine and is working on methods to continuously address and allay market uncertainty.

Ukraine: Stabilisation Clause Introduced For Renewable Energy Feed-In Tariffs

 09 June 2011

Article by Olexander Martinenko, Vitaliy Radchenko and Volodymyr Kolvakh

The Parliament of Ukraine has recently amended the Law "On Electric Power Industry" No. 575-97-BP, dated 16 October 1997 (the "Law") , by introducing into Article 17(1) of the Law, an additional state guarantee of renewable energy off-take. This amendment has been perceived by industry experts as another preparatory step towards sector reform, bilateral contracts and balancing the electricity market. The Law is now awaiting the President's signature and will become effective on the day after its official publication.

This so-called 'stabilization clause' provides that the State shall guarantee that for the whole duration of the feed-in tariffs (i.e. until 2030), that there will always be legislation in place which provides for:

• a mandatory off-take obligation that would apply feed-in tariffs to all volumes of the electricity generated from eligible renewable energy sources (e.g. excluding blast furnace, coke gas and 10 MW+ hydro), and which volumes have not been sold to consumers or power distribution companies directly; and
  
• full and timely monetary settlements for such electricity, as per procedure established by the law.

To this effect, the National Electricity Regulatory Commission of Ukraine (the "NERC") will now be entitled to implement the state policy aimed at boosting renewable energy production by virtue of, inter alia, the approval of renewable energy power purchase agreements with the Wholesale Electricity Market of Ukraine.

Legislation: Law of Ukraine: "On Introducing Amendments to the Law of Ukraine "On Electric Power Industry" (Guaranteeing the State's Obligations to Encourage the Utilisation of the Alternative Energy Sources)"

This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to www.law-now.com/law-now/mondaq

World Bank Loans Ukraine $200 Million To Promote Energy Efficiency

The World Bank agreed to lend $200 million to the State Export-Import Bank of Ukraine to help implement the country's long-term energy reduction strategy. Original article available at http://www.bloomberg.com/news/2011-06-10/world-bank-lends-200-million-to-ukreximbank-for-energy-savings.html.

“To reduce Ukraine’s energy intensity by 50 percent by 2030, as the government plans, will require around $20 billion in investments,” Martin Raiser, World Bank Country Director for Ukraine, Belarus and Moldova, said today in an e-mailed statement. He added that “these would easily pay for themselves through improved competitiveness, reduced import needs and greater energy security.”

Ukraine, which has a population of 46 million, relies on Russian natural gas imports for more than 50 percent of its needs. The country plans to purchase 40 billion cubic meters of gas this year, according to Energy and Coal Minister Yuriy Boyko.

UKRAINE: FISCAL INCENTIVES FOR ENERGY EFFICIENCY AND ALTERNATIVE ENERGY

Original article available at: www.usubc.org

Asters law firm, Kyiv, Ukraine, Monday, May 30, 2011
KYIV - Sustainable energy use has a significant place in Ukraine's energy policy. The Energy Strategy to 2030 and the Economic Reform Programme for 2010 to 2014 both identify switching to alternative energy sources and achieving greater energy efficiency as key priorities.
The first incentives for implementing energy efficiency measures were introduced in 2008 by amendments to the Law on Energy Efficiency and the Law on the Unified Customs Tariff, which granted a number of tax privileges to companies involved in the development and use of energy-efficient technology and alternative energy sources. The recently adopted Tax Code provides significant incentives for companies and transactions in these areas.
CORPORATE PROFIT TAX
The code provides that 80% of an eligible company's profit from sales of its own goods within the Ukrainian customs territory is exempt from charged at 23% corporate profit tax, provided that the goods are on a list approved by the government. The code generally identifies the following types of goods as being subject to this exemption:

1. equipment for working on renewable energy sources;
2. raw materials, equipment and components for renewable energy generation;
3. energy-efficient equipment and materials, and goods whose use results in a more efficient and controlled use of fuel and energy resources;
4. devices for measuring, controlling and operating fuel and energy resources; and
5. equipment for producing alternative fuels.

The code also exempts 50% of all profits derived from the implementation of measures and projects relating to energy efficiency. In order to qualify for the exemption, a company that conducts such activities must be registered with the special state registry of companies, agencies and organisations that are involved in the use, development and implementation of energy efficiency measures and projects.
These incentives are effective for five years from the first year in which a profit is made from the manufacturing processes related to energy efficiency.
In addition, a general tax exemption to January 1 2020 will apply to:

1. biofuel producers' profits from sales of such fuel;
2. profits from the generation of electrical and heat energy with the help of biofuels; and
3. manufacturers' profits from sales of machinery and equipment produced in Ukraine for manufacturing and converting vehicles powered by biofuel.

Energy companies are exempt from corporate profit tax on the sale of electricity from renewable energy sources for 10 years from January 1 2011.
VALUE-ADDED TAX
Imports of the following goods are generally exempt from charged at 20% VAT:

1. equipment for work on renewable energy sources;
2. energy-efficient equipment and materials;
3. devices for measuring, monitoring and operating fuel and energy resources;
4. equipment and materials for producing alternative fuels or generating energy from alternative sources; and
5. materials, equipment and components required for the production of:
   1. equipment that runs on renewable energy;
   2. raw materials, equipment and components for producing alternative fuels or generating energy from renewable sources;
   3. energy-efficient equipment and materials;
   4. goods whose use results in a more efficient and controlled use of fuel and energy resources; and
   5. devices for measuring, controlling and operating fuel and energy resources.

The code also provides a temporary VAT exemption, effective until January 1 2019, for:

1. the supply on Ukrainian territory of machinery and equipment specified in the Law on Alternative Fuels;
2. imports of equipment and machinery for the construction and reconstruction of enterprises producing biofuel and biofuel vehicles; and
3. imports of biofuel-powered vehicles.

However, these import exemptions apply only if identical goods are not produced in Ukraine.
LAND TAX
Generators of electricity from renewable sources enjoy a 75% discount on land tax.
COMMENT
It is too early to say whether the incentives will help Ukraine to become more energy efficient and less reliant on conventional fuels in the long term. However, green tariffs, customs and tax incentives should encourage foreign investors to consider Ukraine's investment potential.

INFORMATION: For further information please contact, Yaroslav Petrov, Associate, yaroslav.petrov@asterslaw.com or Kostya Solyar, Associate, kostya.solyar@asterslaw.com .
NOTE: Asters law firm is a member of the U.S.-Ukraine Business Council (USUBC), Washington, D.C., www.USUBC.org.

AGROTON PUBLIC LIMITED PLANS US$ REGULATION S EUROBOND ISSUE

FITCH AND STANDARD & POOR'S ASSIGNED B- RATING BOTH TO AGROTON AND THE ISSUE


Agroton Public Limited, one of the largest agricultural producers in Ukraine, announced it’s going to issue its debut US$ Regulation S Eurobond notes.

Agroton has appointed VTB Capital plc and Dragon Capital (Cyprus) Limited as the Joint Lead Managers and Jaspen Capital Partners as the Co-Lead Manager to manage its debut US$ Regulation S Eurobond issue.

The investor road-show is expected to commence on 10 May 2011.

The proceeds from the bonds will be used to redeem all existing bank debt of around USD21m, and to fund the construction of additional grain storage facilities, expansion of the Group’s existing land bank and acquisition of additional agricultural machinery as well as for general corporate purposes of the Group. Future cash from the bond proceeds will be deposited initially in Bank of Cyprus (BBB+/Negative Outlook) in USD.

Fitch Ratings has assigned Agroton Public Limited’s planned notes foreign-currency senior unsecured rating of ‘B-(exp)’ and an expected Recovery Rating of ‘RR4’. Agroton has Long-term foreign and local currency Issuer Default Ratings (IDR) of 'B-' and a National Long-term of 'BBB(ukr)'. The Outlook on these ratings is stable.

Today, also Standard & Poor's Ratings Services assigned its 'B-' long-term corporate credit rating to Agroton Public Ltd. The outlook is stable.

At the same time, Standard & Poor's assigned an issue rating of 'B-' to Agroton's proposed senior unsecured notes.

(News taken from Agroton company website:  http://www.agroton.com.ua/en/news-90.htm)

Warsaw Stock Exchange Creates New Index For Ukrainian Listed Companies

On May 4, the Warsaw Stock Exchange announced a new index WIG Ukraine, comprising 5 listed Ukrainian companies (Agroton, Astarta Holding, Kernel Holding, Milkiland and Sadovaya Group). Additional listed Ukrainian companies may join the index in the near future also, such as Industrial Milk Company (which started trading yesterday) and KSG Agro (starting trading next week).

The WIG Ukraine index requires companies to maintain a free float of at least 10%. The index's revision will be conducted quarterly.

The creation of the new index results from the increased interest shown by Ukrainian firms in the Warsaw Stock Exchange, as well as of the exchange's marketing strategy to attract more Eastern European firms for listing.

For more information kindly see: http://www.warsawvoice.pl/WVpage/pages/article.php/16578/news

Jon M Queen

Fitch assigns B- rating to Agroton, the vertically integrated Ukrainian agriculture company

(News taken from company website: http://agroton.com.ua/ge/news-88.htm)

Fitch Ratings Assigns B- to Agroton

Fitch Ratings has assigned Agroton Public Limited Long-term foreign and local currency Issuer Default Ratings (IDR) of ‘B-’. Fitch has also assigned a National Long-term rating of ‘BBB(ukr)’. The Outlook is Stable.


The Long-term IDRs reflect Agroton’s above-average business risks, due to the strong cyclicality and seasonality of agricultural commodities, its weak free cash flow profile as a result of the large amount of capital tied up in working capital, its reliance on one geographical area in Ukraine and its small size, as illustrated by reported net sales and EBITDA for fiscal year ending December 2010 of USD97.1m and USD38.5m, respectively. These factors are mitigated by the long-term growth prospects for the agricultural sector in Ukraine and Agroton’s high output yields relative to peers and independent farmers.


The ratings also take into account the diversification provided by the livestock division, which mitigates factors such as the volatility in crop production volumes and yields derived from factors which are outside management control, namely adverse weather conditions, cost inflation and/or a sudden decline in selling prices. Agroton's large storage capacity (almost 100% of total grain production), also mitigates sudden changes in selling prices, as it allows the company to sell grain at more convenient prices throughout the year.


Furthermore, management’s commitment to maintain a maximum total debt/EBITDA ratio of 2.0x (throughout the year) and inventories that can be liquidated with relative ease should the need arise, underpins the group’s financial flexibility.


The ratings also reflect Fitch’s expectation of a conservative financial policy, maintaining adequate liquidity reserves while minimising refinancing risk in the longer term. Moreover, the group has accessed equity capital, by way of two equity issues in November 2009 and November 2010, raising USD90m in aggregate, which was used to repay existing debt and fund working capital in the business. Fitch also acknowledges that the company demonstrates better corporate governance procedures relative to other Ukrainian peers, including two independent directors on the board and no related-party transactions.


Although Fitch does not anticipate a positive rating action in the near term, broad guidelines for a ‘B’ local-currency IDR include the combination of larger scale, the ability to fund future capex by internally-generated cash flows, and FFO adjusted leverage between 1.5-2.0x (on a rolling two-year basis), equating to 1.2x-1.6x lease-adjusted gross leverage. Further rating uplift on the ‘B-’ foreign-currency IDR is constrained by lack of sizeable export revenues. Fitch notes that Agroton plans to start exporting directly in H211.

Recent article about green energy in Ukraine -- http://www.unian.net/rus/print/432660

Эксперт: правительство сделало акцент на зеленую энергию

Украина имеет большой потенциал в области развития альтернативной энергетики, считает Управляющий директор компании Jaspen Capital Partners Джон МАККВИН.
Как передает корреспондент УНИАН, об этом он заявил во время международного форума чистых технологий «ECOSMART-2011», который на этой неделе завершился в Киеве.
«Украина очень удачно расположена во многих смыслах. У вас есть выбросы углерода, я не знаю, как это будет делаться после 2012 года, но это направление жизнеспособные, - зеленые продукты, биогаз, биомасса, пилеты. Эти проекты могут генерировать весьма интересные результаты и создавать рынок капитала. Соседние страны не имеют такой возможности», - сказал Дж.МАККВИН.

«У вас очень привлекательная территория, и некоторые компании пользуются случаем уже сегодня. Вы привлекаете средства с точки зрения рынка капитала - это может обеспечить стратегический интерес к вашему проекту. У вас больше 40 компаний, которые зарегистрированы в НКРЭ, это очень функциональный инструмент. Это очень привлекательная ситуация. У вас 5 проектов по ветрякам, 2 – по биомассе (на одном я работал), 5 – лицензированных солнечных проектов, 61 – гидроэлектростанции. Гидроэнергетические проекты – это очень успешная коттеджная индустрия. И они получают тарифы и зарабатывают неплохие деньги», - сказал американский эксперт.

Он отметил, что украинское правительство сделало очень серьезный акцент на зеленую энергию, чтобы привлечь больше инвесторов. Дж.МАККВИН также положительно охарактеризовал действия украинской власти по внедрению механизма «зеленого» тарифа.
В Украине очень легко открыть такой проект, если правильно оформить все документы, заявил эксперт.

«61 проект получил лицензию за последних 1,5 года. Это значит, что это работает. С каждым годом становится понятно, что у Украины есть интерес продолжать работать с зеленым тарифом», - подчеркнул Дж.МАККВИН. По его словам, у Украины есть много путей, как генерировать «зеленую» энергию, в частности, очень много биомассы, много исторических площадок для малых гидроэлектростанций – свыше 180 малых ГЭС работали до массового развития атомной энергетики. Сейчас необходимо их только переоборудовать за сравнительно небольшие средства, отметил Дж.МАККВИН.

Он также заявил, что компании могут активнее использовать механизмы Киотского протокола и получать дополнительные средства на развитие через углеродные кредиты.
По его мнению, возобновляемые виды энергии будут очень привлекательными на макроуровне на фондовых рынках. Он обратил внимание на то, что наибольшее количество ІРО за последние 4 года в Западной Европе касались именно «зеленой» энергетики.

«В Украине есть несколько компаний, которые могут достичь таких результатов, если правильно оценить рынки. У некоторых компаний есть десятки миллионов энергоресурсов, в частности, некоторые проекты по биогазу. И если они решат разместить евробонды, то будут иметь хорошие шансы на успех. Потому что в этом году на Гонконгский фондовой бирже компании это делают очень успешно. В Польше вы можете увидеть много заинтересованных инвестировать в Украину. Некоторые украинские компании уже внесены в списки фондовых бирж, и это среднего уровня компании – не очень большие», - сказал Дж.МАККВИН.

Как сообщалось, правительство Украины утвердило в прошлую среду изменения в Государственную целевую программу энергоэффективности, которые впервые фиксируют среднесрочную цель Украины - достичь 10% производства энергии из альтернативных источников до 2015 года.


За последние двенадцать месяцев количество производителей «чистой» энергии, которые получают возможность работать по “зеленым” тарифам, удвоилось. Количество объектов, которые работают по «зеленым» тарифами, увеличилось за это время с 50 до 75.

The original article can be found at: 
http://www.unian.net/rus/news/news-432660.html

Chinese Clean Energy IPOs to top $1.1 billion this year on HKSE

Beijing Jingneng Clean Energy (BJCE) and the solar glass unit of Xinyi Glass Holdings (Xinyi) will launch initial public offerings on the Hong Kong Stock Exchange this year, according to the The Wall Street Journal. BJCE plans to conduct a $500 million IPO in Q2, while Xinyi plans to raise $600 million in Q3.

Chinese clean energy firms successfully raised $2.4 billion in Hong Kong last year, as the country continues to promote clean energy technology to cut its greenhouse gas emissions and reliance on fossil fuels.

Beijing plans to derive 15 percent of its energy from renewable sources by 2020 through increased use of wind, solar and nuclear power, the WSJ said.

Daily Market Brief

Market Comment

Ukrainian equity markets rose along with major European indexes Friday (Mar. 18). The UX exchange climbed steadily throughout the day to add 2.55%. Total equity trading volume came in at a moderate UAH 191 mln – typical for the last session of the week. Motor Sich (MSICH) stole the show once again, rising 5.29% on a hefty volume. Metals and mining stocks (ALMK +5.59%, AZST +4.37%, AVDK +3.84%, ENMZ +4.68%, YASK +1.85%) surged for a second straight session. Ukrainian electricity generators made impressive ascents, with Centerenergo (CEEN +2.35%) and Donbasenergo (DOEN +2.35%) tacking on to gains, and Zakhidenergo (ZAEN +1.57%) making a noteworthy turnaround. Banks (BAVL +1.92%, USCB +3.39%) ratcheted up, and Ukrnafta (UNAF +0.63%) made a late session push into the black. Support for Ukrtelecom (UTLM) waned, with the stock shedding 0.77%.

In London, Ukrainian oil and gas names closed mixed: JKX Oil & Gas (JKX LN +0.87%) posted a meager gain, Regal Petroleum (RPT LN -1.56%) stepped down a notch, and shares of Cadogan Petroleum (CAD LN -5.73%) plummeted. Ferrexpo (FXPO LN +2.54%) continued to catch investors’ attention, while MHP (MHPC LI -0.06%) closed just shy of the flat line. In Warsaw, Astarta (AST PW -0.06%) and Kernel (KER PW -0.37%) finished the session slightly lower and Agroton (AGT PW) closed flat.


Fixed Income: Ukraine contemplates ruble bond issue
Metals and Mining: Yasynivka Coke’s net profit increases in 4Q10

Daily Market Brief

Market Comment

Ukrainian equity markets continued their push back into positive territory yesterday (Mar. 17). The UX exchange added 1.8% on a moderate equity trading volume of UAH 182 mln. Motor Sich (MSICH +1.25%) took a bite out of losses posted earlier in the week. Metals and mining stocks (ALMK +3.12%, AZST +3.43%, AVDK +1.15%, ENMZ +2.68%, YASK +1.47%) added to the index’s positive momentum. Trading for Ukrnafta (UNAF +0.88%) remained steady ahead of next week’s crucial EGM. GenCos closed mixed: Centerenergo (CEEN +3.06%) and Donbasenergo (DOEN +1.64%) surged, while Zakhidenergo (ZAEN -1.52%) posted a notable decline. Banks (BAVL +1.67%, USCB +2.75%) and Ukrtelecom (UTLM +1.54%) fell in line with the advance. Stirol (STIR +4.61%) skyrocket on the back of news that the company had recommenced production of ammonium nitrate at a facility closed back in 2009.

On international markets, Ukrainian names followed the general upward climb. Ferrexpo (FXPO LN) had a monster session, posting a 4.57% rise. Oil and gas companies (CAD LN +1.95%, RPT LN +0.63%, JKX LN +2.55%) closed with moderate gains, and MHP (MHPC LI +0.63%) made a slight turnaround. In Warsaw, agricultural and food processing stocks (AGT PW +1.51%, AST PW +1.94%, KER PW +1%) gained ground.

GenCos: Ukraine raises residential electricity tariffs
Machinery: Ukraine and Russia tie another knot on aviation deal

Daily Market Brief

Market Comment

The rebound was on for Ukrainian equity markets yesterday (Mar. 16). Following a weeklong skid the UX exchange returned to positive territory with a 1.6% advance. Equity trading volume was moderate at UAH 200 mln. The resurgence was led by volume leaders Motor Sich (MSICH +1.87%) and Ukrnafta (UNAF +2.99%). GenCos (CEEN +1.48%, DOEN +1.64%, ZAEN +3.53%) were among the session’s top gainers. With the exception of Yasynivka Coke (YASK -0.41%), metals and mining stocks (ALMK +0.8%, AZST +1.23%, ENMZ +1.39%) gained ground. Banks (BAVL +1.07%, USCB +1.81%), Ukrtelecom (UTLM +0.93%) and Stirol (STIR +2.38%) fell in line with the general advance.

In London, Ukrainian oil and gas stocks reported mixed results: Cadogan Petroleum (CAD LN +3.36%) and Regal Petroleum (RPT LN +1.27%) won back most of the previous session’s losses, while JKX Oil & Gas (JKX LN -2.01%) continued to fade. Ferrexpo (FXPO LN +0.96%) inched into the black, and MHP (MHPC LI -2.78%) suffered a notable decline. In Warsaw, Agroton (AGT PW +0.82%) and Astarta (AST PW +1.9%) ended on a positive note, while Kernel (KER PW -1.78%) slid


Macro: Ukraine’s GDP growth up to 7% in February
Metallurgy: Ukrainian steel production to intensify in April

Daily Market Brief

Market Comment

Ukrainian equity markets took a pounding yesterday (Mar. 15), as investors continued to turn their backs on stocks following the devastation in Japan. The UX exchange (-3.19%) fell more than 80 points on a hefty equity trading volume of UAH 245 mln. Motor Sich (MSICH -6.08%) led the plunge for yet another session; the stock has dropped more than 13% over the past week. Metals and mining companies (ALMK -5.01%, AZST -4.14%, YASK -5.78%, ENMZ -6.8%), GenCos (CEEN -5.55%, DOEN -6.73%, ZAEN -3.55%) and Stirol (STIR -6.65%) took it on the chin. Banks (BAVL -3.15%, USCB -2.91%) and Ukrtelecom (UTLM -3.04%) did not fare much better. Ukrnafta (UNAF +0.79%) managed to avoid the fall, braced by news that shareholders would consider a 25% share capital increase at next week’s EGM.

On international markets, Ukrainian stocks were engulfed in the widespread selloff. Cadogan Petroleum (CAD LN -5.7%) suffered the most severely impact, while oil and gas peers Regal Petroleum (RPT LN -1.88%) and JKX Oil & Gas (JKX LN -2%) closed well into the red. Ferrexpo (FXPO LN -2.18%) reversed to losses, and MHP (MHPC LI -3.49%) continued its decline. In Warsaw, Agroton (AGT PW -3.23%) recorded a dramatic drop and Astarta (AST PW -0.95%) faded. Kernel (KER PW) managed to find support, and posted a noteworthy gain of 1.69%.


Fixed Income: Placement of Ukrainian Treasuries tops UAH 3.3 bln

Daily Market Brief

Market Comment

Volatile trading characterized Ukrainian stock markets yesterday (Mar. 14), as investors across Europe continued to size up the economic ramifications of the earthquake and tsunamis in Japan. The UX exchange (-1.29%) extended what has become a weeklong slide. Total equity trading volume came in at a moderate UAH 183 mln. Late session surges by Ukrnafta (UNAF +0.12%) and Ukrtelecom (UTLM +0.86%) were not enough to hoist the exchange into positive territory, as volume leader Motor Sich (MSICH -2.23%) weighed heavily on the market. Stirol (STIR -2.41%), GenCos (ZAEN -1.62%, CEEN -2.26%, DOEN -2.77%) and metals and mining names (ENMZ -3.1%, AZST -1.64%, YASK -0.95%%, AVDK -2.62%) dragged the exchange even deeper into the red.

In London, Ukrainian oil and gas producers reported mixed results, with Regal Petroleum (RPT LN +1.25%) and JKX Oil & Gas (JKX LN +2.54%) winning back the previous session’s losses, and Cadogan Petroleum (CAD LN -0.3%) shedding. Ferrexpo (FXPO LN +2.04%) continued its rise, while MHP (MHPC LI -2.36%) sunk deeper. In Warsaw, Astarta (AST PW -0.31%) and Kernel (KER PW -0.37%) slid, and Agroton (AGT PW +0.51%) made a slight turnaround.


Oil & Gas: Ukrnafta to consider share capital increase

Daily Market Brief

Market Comment

Ukrainian stock markets were open for trading Saturday (Mar. 12) to make up for the day off taken earlier in the week in connection with a local holiday. The UX exchange opened higher, but slid throughout the session to close with a 1.76% decline. Total equity trading volume was expectedly weak at UAH 137 mln. Ukrnafta (UNAF -6.94%) dropped sharply for a second straight session. Metals and mining stocks closed mixed: ALMK -0.5%, AVDK +0.9%, YASK +1.09%, ENMZ -1.02%. Banks (USCB -0.24%, BAVL -0.5%) posted meager losses. Volume leader Motor Sich (MSICH +0.62%) found support, Ukrtelecom (UTLM -1.09%) dimmed, and GenCos (ZAEN -0.43%, DOEN +0.29%, CEEN +0.29%) traded in opposite directions.

Local stock markets took on notable losses Friday (Mar. 11), as negative sentiment resulting from the devastating earthquake and tsunamis in Japan spread around the globe. The UX exchange tumbled more than 80 points in the early hours of trading, but settled in the afternoon to close lower by 1.85%. Total equity trading volume was high at UAH 260 mln. Ukrnafta’s (UNAF -4.13%) sharp fall weighed heavily on the index. Most metals and mining names (ALMK -0.74%, AVDK -1.37%, AZST -0.63%, ENMZ -0.63%) continued their losing streaks, while Yasynivka Coke (YASK +1.62%) made a strong late-session surge into the black. Banking stocks (BAVL -2.13%, USCB -0.75%), GenCos (CEEN -1.47%, DOEN -2.8%, ZAEN -1.57%), Motor Sich (MSICH -1.23%) and Stirol (STIR -1.83%) were not immune to the selloff. Ukrtelecom (UTLM +1.02%) bucked the market’s downward trend on the back of news that Epic Financial Consulting Gesellschaft had completed a deal with Ukrainian authorities to purchase a near 93% stake in the company.

In London on Friday, only Cadogan Petroleum (CAD LN +1.6%) and Ferrexpo (FXPO LN +1.4%) emerged in positive territory. Regal Petroleum (RPT LN -1.25%), JKX Oil & Gas (JKX LN -2.32%) and MHP (MHPC LI -1.04%) continued to fall. In Warsaw, Astarta (AST PW-0.63%) slowed its tumble, while the negative pace of Kernel (KER PW -1.35%) and Agroton (AGT PW -3.14%) continued to accelerate.


Politics: Ukrainian Supreme Court Chairman survives sack attempt
Fixed Income: Naftogaz reports UAH 21.4 bln net loss in 2010
Metals and Mining: Avdiivka Coke posts $2.8 mln in net losses for 2010

Daily Market Brief

Market Comment

Ukrainian equity markets ended in a real slump on Thursday (Mar. 10). The UX exchange lost 2.27%, with total equity trading volume coming in at UAH 180 mln. Steel makers were knocked over for a second straight session: ALMK -4.56%, ENMZ -3.68%, AZST -2.85%. Whopping drops were also recorded for banks (BAVL -3.41%, USCB -2.93%) and Motor Sich (MSICH -3.37%). Ukrtelecom (UTLM -2.44%), GenCos (ZAEN -2.9%, CEEN -2.14%) and coke producers (YASK -2.03%, AVDK -1.95%) traded up a notch in comparison, but still closed deep in the red. Ukrnafta (UNAF -0.94%) suffered the least damage on the day.

The downturn continued for Ukrainian companies listed on international markets. In London, Cadogan Petroleum (CAD LN -5.46%) and JKX Oil & Gas (JKX LN -1.57%) suffered further price slashes, while Regal Petroleum (RPT LN) closed flat. Ferrexpo (FXPO LN -2.77%) took another blow, and MHP (MHPC LI -0.46%) dipped below the flat line. In Warsaw, Astarta (AST PW -10.41%) plummeted on news that Chairman Valery Korotkov’s holding had sold 1.5 mln shares, lowering its stake to 26%. Agroton (AGT PW -1.84%) and Kernel (KER PW -0.49%) ended trading slightly tarnished.


Fixed Income: Ukraine’s Financing of Infrastructural Projects preparing new Eurobond sale

Daily Market Brief

Market Comment

Ukrainian equity markets experienced significant downturns on Wednesday (Mar. 9). The UX exchange lost 1.29%, with total equity trading volume dropping to UAH 164 mln. Steelmakers took on the roles of loss leaders: Azovstal (AZST -3.78%), Enakievo Steel (ENMZ -3.76%) and Alchevsk Steel (ALMK -2.16%) all experienced severe falls. Additional drag was dumped on by coke producers (AVDK -1.43%, YASK -1.11%), Ukrtelecom (UTLM -1.94%), Motor Sich (MSICH -1.9%) and Centerenergo (CEEN -1.87%). Zakhidenergo (ZAEN -0.24%) and Raiffeisen Bank Aval (BAVL -0.68%) made shallow swoops into the red. Meanwhile, Ukrnafta (UNAF) closed flat and Ukrsotsbank (USCB +0.38%) managed to end the session in positive territory.

Ukrainian companies lost across the board on international markets. In London, Cadogan Petroleum (CAD LN -8.01%) cut back sharply, Regal Petroleum (RPT LN) dropped 1.23% and JKX Oil & Gas (JKX LN -0.81%) closed with a small tumble. Ferrexpo (FXPO LN -3.72%) took another blow, while MHP (MHPC LI -0.05%) ended a pinch below the flat line. In Warsaw, Astarta (AST PW -6.39%) gave back the bulk of previous sessions’ growth, Kernel (KER PW -1.33%) sunk, and Agroton (AGT PW -0.24%) dimmed slightly.

Macro: Headline inflation for Ukraine down to 7.2% Y-o-Y in February

Daily Market Brief

Market Comment

Ukrainian equity markets experienced volatile trading on Friday (Mar. 4). While the PFTS managed to close in the black, the UX exchange slipped by 0.02%. Total equity trading volume on the UX amounted to UAH 196 mln. The impressive gain by Ukrtelecom (UTLM +3.82%) was not enough to keep the index afloat, as significant losses by metals and mining names (ENMZ -2.32%, AZST -2.03%, ALMK -1.67%, YASK -1.38%, AVDK -1.28%) took their toll. Meager losses came in for Ukrnafta (UNAF -0.17%) and Motor Sich (MSICH -0.4%). Banks ended the day with mixed results: Raiffeisen Bank Aval (BAVL +0.31%) made a slight advance, while Ukrsotsbank (USCB -0.73%) inched down. Among electricity generating companies, Zakhidenergo (ZAEN +0.59%) ended trading in positive territory, while Centerenergo (CEEN -0.01%) closed out flat.

In London yesterday (Mar. 8), JKX Oil & Gas (JKX LN +0.72%) managed to eke out a gain, while both Cadogan Petroleum (CAD LN) and Regal Petroleum (RPT LN) closed flat. Ferrexpo (FXPO LN -2.16%) experienced a notable drawback, while MHP (MHPC LI +1.84%) took a step up. In Warsaw, Agroton (AGT PW +1.01%) stood out among its Ukrainian peers, Kernel (KER PW +0.06%) could not make significant progress and Astarta (AST PW -0.57%) took a small tumble.


Fixed Income/Agriculture: Avangard reports upbeat financials for FY10
Metals and Mining: Azovstal deepens quarterly losses to $33 mln

Daily Market Brief

Market Comment

Ukrainian equity markets landed in positive territory on Thursday (Mar. 3). The UX exchange gained 0.66% on a marginally lower equity trading volume of UAH 188 mln. GenCos (CEEN +2%, ZAEN +1.63%) took the lead step forward. Motor Sich (MSICH +1.49%) rose significantly as well. Metals and mining stocks (YASK +1.47%, ENMZ +1.41%, AZST +1.18%, ALMK +0.91%, AVDK +0.3%) charged forward to partially recover previous losses. Banking names lunged back into the black (USCB +1.14%, BAVL +0.5%). Ukrtelecom (UTLM +0.09%) posted a humble gain, while investors pulled back the reins slightly on Ukrnafta (UNAF -0.46%).

Oil and gas names shone brightly in London, with Cadogan Petroleum (CAD LN +2.99%) and Regal Petroleum (RPT LN +2.63%) setting the pace. JKX Oil & Gas (JKX LN +1.72%) was not far behind. MHP (MHPC LI +2.43%) put in an impressive performance, while Ferrexpo (FXPO LN +0.5%) hovered just over the flat line. In Warsaw, Astarta (AST PW +1.01%) made a positive move once again, but Kernel (KER PW -0.12%) and Agroton (AGT PW -0.11%) just could not manage to break even.


Metals and Mining: Enakievo Steel to restore output in March
Metals and Mining: Yasynivka Coke to commission battery No. 4 this spring

Daily Market Brief

Market Comment

Ukrainian equity markets waded into the red on Wednesday (Mar. 2). The UX exchange lost 1.54% as equity trading volume lowered to UAH 192 mln. Metals and mining stocks were the session’s biggest losers, with most declines coming in at over two percent: ALMK -3.05%, AZST -2.86%, ENMZ -2.08%, YASK -2.05%, AVDK -1.55%. Motor Sich (MSICH -1.91%), Ukrnafta (UNAF -1.47%) and banks (USCB -1.43%, BAVL -0.54%) posted significant drops. Ukrtelecom (UTLM -0.15%) took a timid step down. Among electricity generators, Centerenergo (CEEN -1.4%) fell in parity with most liquid names, while Zakhidenergo (ZAEN +1.23%) stood out with a notable hike.

In London, Cadogan Petroleum (CAD LN +1.83%) powered up, while Regal Petroleum (RPT LN -1.3%) and JKX Oil & Gas (JKX LN -0.19%) decelerated. Ferrexpo (FXPO LN -1.18%) and MHP (MHPC LI -0.53%) dipped. In Warsaw, only Astarta (AST PW +0.43%) managed to close in the black, while Kernel (KER PW -0.12%) and Agroton (AGT PW -2.04%) slipped.


Metals and Mining: Ferrexpo's production declines 3% in February

Daily Market Brief

Market Comment

Ukrainian equity markets closed mixed on Tuesday (Mar. 1). The PFTS recorded a modest rise, while the UX exchange lost 1.05% on the back of a solid equity trading volume of UAH 230 mln. Stocks listed on the UX lost between one and three percentage points across the board. GenCos (ZAEN -2.90%, CEEN -1.34%), metals and mining names (AVDK -2.62%, AZST -2.51%, ENMZ -1.91%, ALMK -1.57%, YASK -0.14%) and banks (BAVL -2.17%, USCB -1.57%) all declined steadily. Even Ukrnafta (UNAF -1.45%) fell off its high horse. In contrast, Ukrtelecom (UTLM -0.27%) and Motor Sich (MSICH -0.08%) dipped just below the flat line.

It was an impressive day for oil and gas names in London: Cadogan Petroleum (CAD LN) soared 5.13%, while JKX Oil & Gas (JKX LN +1.71%) and Regal Petroleum (RPT LN +1.32%) posted notable gains. Ferrexpo (FXPO LN +0.81%) recorded a moderate growth pace, and MHP (MHPC LI +1.33%) accelerated. In Warsaw, Kernel (KER PW -0.12%) shed, while Astarta (AST PW +0.75%) and Agroton (AGT PW +0.27%) closed in the black.


Fixed Income: Oschadbank places benchmark Eurobonds
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Metals and Mining: Daily coke output in Ukraine remains unchanged in February
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Daily Market Brief

Market Comment

Ukrainian equity markets kept up the positive pace on Monday (Feb. 28). The UX exchange gained 2.31% on a solid equity trading volume of UAH 241 mln. Bulls flocked around Ukrnafta (UNAF) once again, bringing the stock up 4.99%. Impressive performances were put in by metals and mining names (AZST +3.64%, ALMK +2.73%, AVDK +2.43%, YASK +2.24%, ENMZ +1.66%). GenCos made significant advances, with Centerenergo (CEEN +3.74%) clearly in the lead and Zakhidenergo (ZAEN +1.1%) trailing by a length. Banking names (USCB +1.66%, BAVL +1.12%) recorded moderate growth, Motor Sich (MSICH) climbed 1.24%, and Ukrtelecom (UTLM +0.51%) slowed its winning pace.

In London, oil and gas names corrected slightly: Cadogan Petroleum (CAD LN -0.95%) and Regal Petroleum (RPT LN -0.33%) inched down, while JKX Oil & Gas (JKX LN -0.07%) dipped its toe just below the surface. Ferrexpo (FXPO LN +2.47%) made another leap, while MHP (MHPC LI +0.92%) advanced moderately. In Warsaw, Kernel (KER PW +4.61%) stole the show this time around, while Agroton (AGT PW +0.54%) and Astarta (AST PW +0.16%) closed just in the black.

Macro: Ukraine’s budget deficit at UAH 942 mln in January
Fixed Income: Forum Bank eyes Eurobond issue