Ukraine sells three upstream blocks

11 March 2019

Ukraine’s online auction system sold three concessions in the Kharkiv and Poltava regions, said the head of the association of gas producers of Ukraine, Roman Opimakh March 7. The total amount paid was just over hryvnia 140mn ($5.1mn), a record-breaking amount, he said. 

Winners were privately-held Burisma Group and DTek and the state-owned Ukrgazvydobuvannya, a subsdiary of Naftogaz Ukrainy. But seven blocks had no bids and these may be auctioned in the future. 

The second licensing round includes seven blocks, covering over 1,000 km² and will be held on May 2. The third one is planned to be announced shortly, he said. 

Kiev also launched tenders for production-sharing agreements for 12 onshore blocks, adding that documents for nine of the blocks with a total acreage of 11,600 km² have already been approved and that potential investors have until the end of May to place their bids.  

The documents for the remaining three blocks will also have to be approved in the upcoming weeks, together with an offshore block covering nearly 10 000 km² in the Black Sea shallow water area. So far, most of the country’s offshore production has been the domain of former state producer Chornomornaftogaz, off Crimea; a Dutch court has ruled that the company’s 2014 appropriation by Russia was illegal.