Vanco Prykerchenska Ltd. expects that in the first half of 2011 the company starts exploration of the Ukrainian Black sea shelf, Vanco Prykerchenska President Jim Bown said in Kyiv on Wednesday.
"We hope to start exploration of [Black Sea] shelf in the first half of 2011," he said, speaking at the Ukrainian Energy Forum organized by the Adam Smith Institute.
Bown also expressed hope that the amicable agreement with the Ukrainian government would be signed soon.
As reported, Vanco International, which is 100% owned by Vanco Energy Company (the United States) won a Ukrainian government tender for the right to enter into production sharing agreements (PSAs) for extraction at the Prykerchensky field of the Black Sea continental shelf in April 2006. It took more than a year to agree a draft PSA, which was finally adopted by the government in October 2007 and signed in the presence of the former President Viktor Yuschenko.
The Environment Ministry of Ukraine in December 2007 issued a license to Vanco Prykerchenska for geological prospecting, research and the commercial production of oil, gas and gas condensate at the Prykerchensky field.
Later, the ministry found that a number of violations of Ukrainian laws were committed during the tender and when the license was issued to Vanco Prykerchenska, and there was evidence of infringements by Vanco International of some PSA clauses.
In April and May 2008, the government cancelled the license of Vanco Prykerchenska and withdrew from the PSA. Vanco went to international arbitration, simultaneously offering the renewal of cooperation under the PSA to the government of Ukraine.
First Deputy Prime Minister Andriy Kliuyev announced in early February 2011 that the Ukrainian government intended to sign an amicable agreement with Vanco Prykerchenska Ltd in February.
Kliuyev said that the agreement does not envisage penalties against the state in the case of the cancellation of the document.
Vanco Prykerchenska is owned in equal shares by Vanco International, DTEK Holdings Limited of Ukrainian businessman Rinat Akhmetov, Shadowlight Investments Limited of Russian businessman Yevgeniy Novitsky, as well as Integrum Technologies Limited.
