Naftogaz To Create Its Own VIOC.

Naftogaz Ukrainy revealed at a press conference yesterday that it will create a vertically integrated oil company as its own subsidiary. No further details were given. Concorde Capital: Creation of a VIOC on the basis of Naftogaz would imply that Ukrnafta (UNAF: Pending) will not get control over the Ukrtatnafta and Galychyna refineries and that the only possibility for Ukrnafta to engage in oil refining would be to integrate with Naftokhimyk Prykarpattya. In addition, the creation of a VIOC on the basis of Naftogaz is probably connected to the possibility of Ukrnafta’s assets being stripped. Whether or not this is true, the news is bad for Ukrnafta. However, Naftogaz?s declared intention to create a VIOC has not yet been approved by the government and may never materialize. WATCH