Government of Ukraine ready to continue dialog with Vanco

13:33, 30 July 2008
Ukraine
1601

But only after it suspends its filing for international arbitration – Korneychuk

The government of Ukraine is ready to continue dialog with Vanco Prickerchenska Ltd., but only after the company suspends its suit filed or international arbitration with Ukraine.

According to an UNIAN correspondent, top deputy Minister of Justice of  Ukraine, acting Minister Yevhen Korniychuk claimed this to a press conference today.

“Our position is that we will immediately hold consultations with Vanco Prickerchenska Ltd., as soon as they suspend their suit.

Ye.Korniychuk disclosed to UNIAN that, as of today, Vanco Prickerchenska Ltd. informed the Justice Ministry about filing for international arbitration with Ukraine.

“We have turned to Vanco with a request – if they want to continue talks, at first it is necessary to suspend the suit for 60 days, and than we will talk”, Ye.Korneychuk emphasized, adding that in such a way the government proposes to continue the period of talks for at least 60 days.

As UNIAN reported earlier, U.S. energy company Vanco said it had filed for international arbitration with Ukraine, after the government cancelled a 30-year license to explore and extract oil and gas in the Black Sea shelf, according to Reuters.

Prime Minister Yulia Tymoshenko has said Vanco broke conditions of the agreement, that the company structure was unclear and has voiced concern that it could sell on the licenses to Russia`s gas export monopoly Gazprom. Vanco has denied the allegations.

Industry sources have said that within Vanco`s company structure in Ukraine lies DTEK, an energy group that is part of the vast empire of firms belonging to Rinat Akhmetov, Ukraine`s richest man and a leader in the opposition Regions Party.

Tymoshenko has said the Black Sea shelf should be developed by state energy firm Naftogaz, with potentially a foreign partner who would get a 30-40 percent stake in a production sharing agreement.

Later, Naftogaz suggested that Gazprom could join it in a joint venture to explore and extract in the shelf.

The contract allowed Vanco to explore and extract in the Prykerchensky block - an area of just under 30,000 square km at the northern end of the Black Sea and 13 km offshore.

Vanco had won the initial contract in early 2006 and then spent 18 months in talks about its details and only received the go-ahead last October. It had said it would spend as much as $3 billion in the long term.

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