Ukrnafta to renew production from the Bytkiv-Babchenske and Lelyaki oil fields
Ukrnafta to renew production from the Bytkiv-Babchenske and Lelyaki oil fields

Ukrnafta is pleased to announce that production at the Bytkiv-Babchenske and Lelyaki fields will restart soon after operations have been suspended for a long period of time. The State Service of Geology and Mineral Resources of Ukraine (Derzhgeonadra) has extended the relevant licenses. Preparations are underway to relaunch operations and complete the formalities to secure the relevant permits.

Production was stopped at Lelyaki in May 2016 and at Bytkiv-Babchenske in July 2015 following the decision by the Derzhgeonadra to withhold renewal of the licenses.

As the result of suspension of operations at these fields in 2016 production of over 75,000 tonnes of oil was lost along with 31 million cubic metres of gas.  At the same time the Government missed approximately UAH 320 million of rent tax, besides profit tax and VAT. In addition, the production stoppage had an adverse environmental impact on the local communities in the vicinity of the Bytkiv-Babchenske deposit.

The decision by Derzhgeonadra to extend the licenses follows favorable court rulings which came in January 2017: one by the Supreme Administrative Court of Ukraine on the license for Bytkiv-Babchenske field and the other concerning the rules for extension and issuance of licenses. 

“We are looking forward to restart the production at the Lelyaki and Bytkiv-Babchenske fields. Suspension of production is not in anyone’s interest, neither the state’s, nor the company’s. Ukrnafta will look forward to renewing 9 production licenses in 2017.”, said EVP Jonathan Popper.

PJSC Ukrnafta owns 55% share in the capital of JV Kashtan Petroleum Ltd. which has held the license for the Lelyaki field since 1996 and 100% share in the capital of JV Ukrkarpatoil Ltd. which has held the license for the Bytkiv-Babchenske field since 1995.

 

For more information please contact press office: +38 044 239 14 93