The political turmoil in Ukraine has led to Regal Petroleum seeing its half-year profits slump in 2015.
In addition geopolitical upheaval, Regal cited continued volatility and weakening of the Ukrainian exchange rates, disruption to the gas sales market and gas sales price and the imposition of significant increases in subsoil taxes for adversely affecting its results.
Regal recorded a loss of $3.3million to June 30 compared with a $3.7million profit in the first half of 2014. Revenue for the six-month period was of $10.9 million compared with $17.5million last year.
During the first half of 2015, the Ukrainian Hryvnia devalued significantly against the US dollar which resulted in a substantial foreign exchange translation loss of $17.6 million for Regal.
Chairman Keith Henry said: “The group is continuing with the development of its Mekhediviska-Golotvshinska and Svyrydivske gas and condensate fields in north-eastern Ukraine, which are held under 100% owned and operated production licences.
“The major events that have taken place in Ukraine during the last 18 months, including the change of Government, civil unrest and military conflict in the east of the country, have meant that there has been a great deal of uncertainty about the political, fiscal and economic outlook in Ukraine.
“As well as adversely affecting the group’s financial results for the first half of 2015, these continuing uncertainties are making it difficult to commit to major capital investment and causing delays to the further development of the MEX-GOL and SV fields in the near term.”