On 6 December 2018, the State Geology Service of Ukraine (the “Geology Service”) launched the first round of electronic auction on 10 onshore oil and gas blocks at the public trading platform Prozorro.Sale.
The total area of these blocks is 1 810 sq. km with estimated deposits of 90 billion cubic meters of natural gas and 16 million tons of oil. The blocks are located in Poltava, Kharkiv, Ivano-Frankivsk, Chernivtsi, Lugansk and Odessa regions. Licenses for nine of those promising blocks are proposed for exploration and production of hydrocarbons for a period of 20 years and one license is proposed for a 5-year exploration period.
The initial price of most of the licenses does not exceed USD 0.7 million. The company, which submits the highest bid in terms of cash bonus, will be awarded lease rights for a specific parcel. There are also minimum exploration program requirements for each license such as processing of legacy seismic data, conducting new seismic surveys and exploration drilling.
An application for participation in the auction shall be submitted within 90 days from the date of publication of the proposals. The auction itself will take place on March 6, 2019.
The Geology Service informs that other 20 blocks will be auctioned at a later date in 2019.
Detailed information provided by Association of Gas Producers of Ukraine can be downloaded following the link: http://www.goukrainenow.com
For further information please contact Asters' partner Yaroslav Petrov or senior associate Marta Halabala.