UKRAINE TO SECURE 70% OF OUTPUT UNDER PSA WITH VANCO PRYKERCHENSKA
Ukraine’s share of hydrocarbons to be produced at the Black Sea Prykerchenskyi O&G acreage under PSA (production sharing agreement) with Vanco Prykerchenska Ltd (British Virgin Islands) to account for 70%, Vanco Prykerchenska Ltd president Jim Bown stated.
“Under the terms of PSA Ukraine is to get 70% of the field output, which is preliminary estimated at 83mn t of crude oil and 180bn m3 of natural gas. The produced volumes would be predominantly supplied for Ukraine’s domestic market. The project implementation is also to translate into higher state budget tax revenues as well as 5,000 new jobs, it will promote Ukraine’s natural gas market development and transparency for the country is to get access to new deep water exploration and drilling technologies,” he said.
According to Bawn, Vanco Prykerchenska renounced its $100mn claims to Ukraine due to amicable agreement between the company and Ukraine approved by Stockholm Arbitration Court in late December. “Under the terms of agreement we gave up our property claims to Ukraine, wich allows immediate launch of this rather milestone project for Ukraine, pending the decision (amicable agreement) legalization in the country. Then the investors would be able to “get round the table” and shape the new investment strategy, striving to avoid the 2008 scenario”, Bown emphasized.
Vanco International, 100% owned by US Vanco Energy Company, in April 2006 was chosen a successful bidder for Ukraine’s government PSA tender for the Black Sea offshore Prykerchenske field hydrocarbons production. In October 2007, Vanco Int. allocated its PSA rights and obligations to Vanco Prykerchenska established in August 2007 and equally owned by Vanco International, DTEK Holdings Limited, Shadowlight Investments Limited (headed by Russian businessman Yevgeniy Novitsky) as well as Integrum Technologies Limited.
In 2008 Ukraine’s Prime Minister Yulia Tymoshenko's government cancelled Vanco Prykerchenska license and withdrew from the PSA. Vanco went to international arbitration, simultaneously offering the renewal of cooperation under the PSA to the country’s government. With the election of Viktor Yanukovych as Ukrainian president, the government lead by Mykola Azarov approved in April 2011 an amicable agreement with Vanco Prykerchenska.
Prykerchenskyi O&G acreage covers 12,960km2 (above 5,000mi2) at the sea depth from 70m to 2,000m (230-6,560ft). The field reserves (D+C2+C3) are preliminary estimated at 30,000 toe per 1km2 which is totally 10.8bn m3.
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