Ukraine to simplify procedure for access to land for oil, gas extraction

Some 231 lawmakers on December 16 supported bill No. 3096 with a required minimum of 226 votes to amend some legislative acts of Ukraine regarding the facilitation of certain aspects of the country's oil and gas industry.

"This bill makes it possible to remove some serious obstacles that do not allow an increase in investment in the industry and geological exploration. This draft law has a serious multiplicative effect for the development of the country's economy," said head of the Verkhovna Rada Committee on Fuel and Energy Complex, MP from the Petro Poroshenko Bloc Oleksandr Dombrovsky, when presenting the document.

Read alsoUkrainian gas reserves plunge to almost 15.6 bcm within weekAs stated in the explanatory note, the bill is designed to simplify bureaucratic procedures for obtaining the right to use land plots by oil and gas companies. It also eliminates the negative economic consequences caused by the imperfection of the procedure for granting land plots for the construction of pipeline facilities, as well as oil and gas wells. In addition, it will create conditions for their reliable and uninterrupted operation and provide conditions for increasing natural gas output by updating the hydrocarbons resource base.

In practice, the procedure for obtaining 44 approvals in 16 institutions for the allocation of land plots takes four years on the average.

"Such overregulation of the industry is a constant source for corruption-related abuses, which does not contribute to improving [its] investment attractiveness," the explanatory note says.

As UNIAN reported earlier, the bill was submitted to parliament in September 2015, but its consideration was repeatedly postponed. On March 21, 2017, the Verkhovna Rada returned this draft law to the respective committee for finalization.

Earlier, Ukrgazvydobuvannia CEO Oleh Prokhorenko said the bill was very important for the development of gas production in Ukraine. According to him, the difficulties in obtaining land plots hamper gas production. As a result, Ukraine failed to produce about 1 billion cubic meters of gas per year due to the problems.