JKX Oil notes Ukraine gas production tax cut

JKX Oil & Gas said on Thursday that the Ukraine government has passed legislation to reduce the gas production tax there from 55% to 29%, with effect from 1 January 2016.

The oil and gas exploration and production company has been at the forefront of campaigning for the reduction, which it said should restore the viability of new capital investment by independent gas producers in Ukraine.

JKX added that as previously stated, it has plans in place for reinstating suspended drilling programmes on its Ukrainian production licences.

The company said the move will not have any impact on its $270m (£185m) international arbitration claim for damages for the recovery of overpayment of production taxes paid to the government, which is the subject of a full hearing in July.

At 1425 GMT, JKX shares were down 1.4% to 26.12p.