* Says additional production tax costs of $10 mln
* Extra costs amount to 25 pct of budgeted 2014 Ukraine
* Shares fall as much as 12.5 pct
(Adds details, share movement)
Sept 22 JKX Oil & Gas Plc said it would
substantially reduce its capital expenditure to offset the
impact of higher production taxes introduced by the Ukrainian
government last month.
Shares in company fell more than 12.5 percent in early
trading, making the stock one of the top percentage losers on
the London Stock Exchange.
JKX, which has most of its production assets in Ukraine and
Russia, said last month that it would take "operational and
financial measures" after Ukraine almost doubled its gas
production tax rate to 55 percent between Aug. 1 and the end of
The additional production tax costs due to the legislation
was $10 million for the five-month period from August to
December 2014, the company said on Monday.
The additional costs amount to about 25 percent of JKX's
budgeted 2014 capital expenditure programme in Ukraine.
Ukraine accounted for 84 pct of JKX's revenue in 2013.
The company said it would continue drilling for gas at its
third well at the Elizavetovskoye field near Poltava in central
Ukraine, but would simultaneously reduce its capital spending in
JKX shares were down 4.9 percent at 43.50 pence at 0748 GMT.
(Reporting by Roshni Menon in Bangalore; Editing by Gopakumar