Up to €36.4m will be used to finance the procurement of workover rigs, which will help increase natural gas production at existing fields
The European Bank for Reconstruction and Development (EBRD) is stepping up efforts to transform Ukraine’s energy sector. A €51.9 million sovereign loan to Ukrgasvydobuvannya (UGV), Ukraine’s largest natural gas producer, will increase domestic natural gas production, reduce the country’s dependency on imports and improve the efficiency and transparency of the sector.
UGV, a fully owned subsidiary of the national joint stock company Naftogaz of Ukraine (Naftogaz) and responsible for 75 per cent of domestic gas production, will receive the EBRD loan in two tranches. Up to €36.4 million will be used to finance the procurement of workover rigs, which will help increase natural gas production at existing fields. Up to €15.5 million will be used for the introduction of innovative Organic Rankine Cycle waste-heat recovery systems at UGV’s site in Lokachi, western Ukraine.
The EBRD’s long-term commitment to the reform of the gas sector in Ukraine has already allowed UGV to implement a robust environmental and social action plan. Effective compliance and anti-corruption measures have also been implemented both at UGV and at the Naftogaz Group level.
In the context of ongoing cooperation with Naftogaz and the government of Ukraine, the EBRD is assisting in setting up a natural gas exchange in the country. The parties also cooperate on legal changes required to attract private investors to Ukraine’s upstream industry.
All contracts under the project financed by the EBRD will be procured by open tender in strict compliance with the Bank’s Procurement Policies and Rules. This will provide equal opportunities for eligible bidders and contribute to the transparency and cost efficiency of UGV’s investment programme.
The EBRD is the largest international financial investor in Ukraine. To date, the Bank has made a cumulative commitment of almost €15 billion through 466 projects in the country.
Source: Company Press Release