Ukrainian government and parliament have introduced a number of measures to prevent proliferation of COVID-19 disease as well as to counter its impact for people and businesses. Find out more at KPMG COVID-19 portal.
Changes in the license auction procedure.
In early February changes were made in the provisional procedure for sale of subsoil use licenses.
The changes now allow foreign companies to participate in the auctions directly, i.e., without registration of subsidiary or representative office in Ukraine.
Approval procedure for licenses and draft PSAs has changed
Regional councils no longer give consent to issuance of licenses for exploration and production of oil and gas and approve drafts PSAs.
New license auctions and PSA tenders were announced
Head of State Geology and Subsoil Service announced new oil & gas auctions and tenders, including:
Blocks that are up for PSA tenders include 2 offshore blocks – Northern and Southern Dolphin – with total area of 15 thousand sq. km.
Fighting against “sleeping licenses”
In early March, two draft laws, nos. 3187 and 3188, were submitted to the parliament aiming to combat “sleeping licenses”. The draft laws suggest imposing additional payments upon holders of such licenses.
New services by gas TSO
Gas TSO of Ukraine presented short-haul product, which allows for discounted transportation between dedicated interconnection points with adjacent countries.
Developing of a new subsoil code
New subsoil code is still being developed. Recently, Head of State Geology and Subsoil Service announced that new subsoil code is expected to allow transfer of E&P licenses subject to prior approval by state authorities.
Feed-in tariff restructuring
Changes in feed-in tariff scheme are pressing issue in Ukraine. Mediation in the Energy Community between RES market players and the Ministry of Energy and Environmental Protection so far has not led to any noticeable results.
Official text of the draft developed by the ministry is yet to be published.
Another pressing issue in the RES sector is lack of energy storages, which results in balancing problem and hinders integration of RES into Ukrainian power system.
Imbalances settlement rules changed
On 1 March 2020 imbalances settlement rules were changed. Payment for imbalances is now calculated using increased or decreased coefficient:
The recent Coronavirus disease (COVID-19) outbreak has created new challenges for the business environment that require a thoughtful, practical and informed approach from leaders. We have prepared a web-site page with materials how to embed resilience and help your business to face this challenging times. KPMG in Ukraine is ready to help you find the answers to your business questions related to coronavirus.
Please write your questions with the subject “Business request as of coronavirus” to us by mail — email@example.com.
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