The Concept for Development of Ukraine’s gas production industry until 2020 has been approved and is expected to be brought out to the Government meeting on the nearest date.

On the 9^th of September, on the eve of the Gasman Day, Gas Production Unit (GPU) ShebelynkaGazVydobuvannya was hosting high visitors. Prime-minister of Ukraine, V. Groysman, vice-prime-minister of Ukraine, V. Kistion, minister of energy and coal industry of Ukraine, I. Nasalik, acting Head of the respective Committee, V. Dombrovskyy, deputy Head of the Committee, O. Belkova, CEO of the Association of Gas Producers of Ukraine, R. Opimakh, managers of Naftogaz Ukraine, A. Kobolev, and UkrGazVydobuvannya, O. Prohorenko, – were the participants of the industrial conference, dedicated to the 60^th anniversary of the Shebelynka gas deposit, the goal of which was to approve the Concept for the industry development until 2020.

Volodymyr Groysman: “One of the government’s priorities today is stimulate domestic gas production in Ukraine. It is possible to perform this work when we have a clear understanding of the goals we are facing, our capabilities and resources. Our goal today is to set a strategic conceptual view of how we are going to operate until 2020, how we are going to provide for our energy independence, how we are going to invest in Ukrainian gas production, how we are going to incentivize the local authorities and local communities, to collaborate with the gas production industry. After the Concept is approved, it will be validated on the Government meeting. The next step is the operations plan, which is the integral part of this Concept. In the plan, we will together with the Parliament clearly form legislation and public Government decisions where needed. We are setting an ambitious goal of increasing natural gas extraction by 7 billion cubic meters by 2020. Today, the state-owned company UkrGazVydobuvannya has received all necessary stimuli to realize this goal. I am ready to present at the government meeting on Wednesday the package of the legislative initiatives, necessary for speeding up those plans. In particular, I am talking about 5 % of the royalty payments, which companies are ready to leave to the community/region/district. An efficient system of special permits issue will also be developed. A new (stimulating) fiscal regime will be introduced for the new investments. As a conclusion of the meeting, at which minister Ihor Nasalik presented the Concept of the Ukrainian gas industry development by 2020, it was decided to introduce the project of accepting the Concept at the government meeting.

Roman Opimakh in his presentation emphasized that the gas producing companies have confirmed readiness to realize the domestic gas production increase program. However, he drew the attention of the participants to the need of creating an attractive investing and regulatory environment. R. Opimakh has also pointed out that a clear government’s vision of the short- and long-term perspectives of the tax policy in the industry is required. “By now, the [tax] policy is not clear. Taxes remain unbalanced and burdensome in case of a decrease in gas prices”, – he stated. The CEO also highlighted the need to audit the issued special permits. V. Groysman responded that the given quantities of the issued permits, which do not work – are instances of corruption in the country, and stated that they need to be cancelled.

Olga Belkova addressed the participants of the meeting, stating that currently the prevailing trend in the world is the search for investments, not resources. We have to speed up the passing of a crucial for the industry and for the regions law on leaving 5 % of the rent to the local communities, and on simplifying the procedure of land issue for the industry’s needs. The MP also offered the prime-minister to further the spread of the EITI in the industry, because it is what the public wants.

As a conclusion of the meeting, the Concept for Development of Ukraine’s gas production industry until 2020 was approved unanimously, and is expected to be presented at the government meeting on the soonest date.