Ukrgazvydobuvannya and Canadian Vermilion have applied for participation in the development of oil and gas fields
Ukrgazvydobuvannya, a member of the Naftogaz of Ukraine group, and Vermilion Ukraine Exploration, a subsidiary of the Canadian oil and gas company Vermilion Energy, have submitted joint applications for participation in 2 competitions for the conclusion of hydrocarbon sharing agreements (PSA), which will be produced in Hrunivska and Akhtyrska fields.
“To increase gas production in Ukraine, we need to bet on new projects, new technologies, new competencies. Naftogaz of Ukraine systematically works in this direction, attracting world-class partners. This is our second participation in tenders for the conclusion of the PSA, together with one of the best and most effective experts in hydrocarbon exploration, the Canadian company Vermilion Energy. The first experience was successful, and we look forward to the transparency and openness of the current competitions. The uniqueness of the general applications lies in the fusion of the best Ukrainian practices and modern Western approaches that Vermilion can bring. We have common values and common goals – to discover new fields, implement unique projects in Ukraine, bring it closer to energy independence”, concluded Andrew Favorov, Director of the Integrated Gas Business Division at NJSC Naftogaz of Ukraine.
It is noted that the results of the competition are expected within a month.
In case of victory and successful negotiations with the government of Ukraine, Ukrgazvydobuvannya and Vermilion undertake to make investments and distribute the proceeds in the proportion of 50/50. According to the agreements, the operator of the work at the stage of geological exploration of the site will be Vermilion. Ukrgazvydobuvannya will have the pre-emptive right to provide its services and perform work for Vermilion, in particular drilling rigs and other services, subject to compliance with industry standards and competitiveness. Partners undertake significant obligations to attract Ukrainian specialists. At the exploration stage, at least 50% of domestic personnel will be involved in the work at the development stage - at least 75%.
As reported, in June 2019, Ukrgazvydobuvannya, together with Vermilion, became the winners of 2 competitions for the conclusion of production sharing agreements – on Balakliyska and Ivankivska squares. In addition, Ukrgazvydobuvannya became the winner of competitions in 2 more sectors (Berestyansky and Buzivsky). Now companies are negotiating relevant agreements with the government of Ukraine. The partners plan to begin preparatory work in these areas as early as 2020.
Vermilion Energy is an international oil and gas company whose shares are listed on the New York and Toronto stock exchanges. Its activities are concentrated in three main regions: North America (Canada, USA), Europe (France, the Netherlands, Germany, Ireland, Croatia, Hungary, Slovakia) and Australia. The company has significant experience and technologies in the production of hydrocarbons on land and at sea, and in particular semi-traditional and non-traditional deposits.
Tags: The Cabinet of Ministers, gas, Naftogaz, contracts, oil, hydrocarbon production, legislation, The Minystry of Energy and Coal Mining, Ukrgazvydobuvannya, gas production, Public Service of Geology and Subsoil of Ukraine, PSA, foreign affairs, Favorov, negotiations, investments, stocks, auctions
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