LONDON (Alliance News) - Regal Petroleum PLC saw its shares fall Friday after it said it expects recent increases in the subsoil taxes in Ukraine to hit its trading results for the current financial year.
On Thursday, the Ukrainian Parliament approved a significant increase in the subsoil taxes payable by oil and gas companies operating in Ukraine. The increase is expected to come into force imminently on approval by the President of Ukraine, and remain in place until January 1, 2015.
In a statement Friday, the AIM-quoted oil and gas exploration and production company said the "full impact" on the company of the proposed increase in the subsoil taxes is "still to be determined", but warned that it will hit its financial results in the current financial year.
Regal Petroleum shares were down 9.1% Friday afternoon, trading at 7.50 pence.
"The company expects that the increases will result in a near doubling in the production based taxes payable by the company and will, therefore, negatively impact the company's results for the current financial year and delay the company's ability to commit to future capital investments in Ukraine during this uncertain period," Regal said in its statement.
Last month, the company issued a statement stating that it has been "generally unaffected" by the geopolitical upheaval in Ukraine, adding that it has been able to produce and operate normally at the Mekhediviska-Golotvshinska and Svyrydivske gas and condensate fields.
By Rowena Harris-Doughty; rowenaharrisdoughty@alliancenews.com; @rharrisdoughty
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