The largest oil producing company of Ukraine PJSC Ukrnafta has to stop oil and gas production at Yuriivske, Golubіvske and Lopushnianske fields due to withdrawal of licenses.
The decision of the Public Service of Geology and Mineral Resources of Ukraine is in conflict with state interests and may lead to more than UAH 30 mln tax underpayment, loss of employment and the stagnation of the Ukrainian oil and gas industry as a whole. It threatens the state’s energy independence and will also influence the local population, as part of the gas produced at these fields is used by the local community.
“A forced decision regarding stoppage of production at three fields of PJSC Ukrnafta has never taken place before. The stoppage of production may bring some irreversible consequences – significant expenditures on well conservation and possibly lead to physical liquidation and recultivation of land. It may also cause environmental risks and violate the conditions of hydrocarbon fields development.” – stated Mark Rollins Chairman of PJSC Ukrnafta.
It is worth to mentioning that when the new Chairman joined the company during the fourth quarter of 2015, the company fully paid current liabilities related to hydrocarbon production at these oilfields.
Every month PJSC Ukrnafta’s operation provides around 125 tons of oil, 11 tons of LPG, and 110 mln cubic meters of gas. Suspension of all licenses, as it is requested by some politicians and officials shall bring massive losses to the State on a monthly basis, as no other company would have the right to develop these fields. PJSC Ukrnafta is the owner of the wells, and infrastructure at the oilfields, including the permits to the use of land.
PJSC Ukrnafta is already taking measures to protect its rights in court and is actively supported by relevant Trade Unions. PJSC Ukrnafta has addressed both the Public Service of Geology and Mineral Resources of Ukraine with a request to abolish the decision, and the Government to intervene.
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