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Europeans are ready to invest in improving the management of the Ukrainian GTS – DiXi Group President

19 November 2019

Cooperation with Western companies in the format of joint management of GTS will help Ukraine to save transit

European companies are ready to invest in the formation of joint governing bodies to improve the management of the Ukrainian gas transmission system (GTS) operator and enter into contracts with the international companies willing to order the capacity of our infrastructure.

This was stated by Olena Pavlenko, DiXi Group President, reports Ukrainian Energy.

“I won’t talk about ownership. But to help with management and how to work properly with Western companies, we can expect it... It is about joint management. We have also heard from European companies that no one is ready to invest in joint ownership right now, too high a risk. But they are ready to invest in forming joint management bodies in order to improve the management of the company and to enter into contracts with the European companies willing to order capacity,” said Pavlenko.

In her opinion, cooperation with Western companies will help Ukraine to save transit. “If we apply European rules, and we are currently implementing European rules, we need to work with European companies. They need to understand what a gas transmission system operator does… I want to summarize: I do not see anything wrong if the French Engie leaves the Nord Stream 2 consortium and starts cooperating with the Ukrainian operator,” noted Pavlenko.

We remind that on 31 October, the Verkhovna Rada approved in the second reading the draft Law "On Amending Certain Laws of Ukraine in Connection with Separation of Natural Gas Transportation Activities" No. 2239-1. The law provides for amendments to 10 laws of Ukraine. A major amendment approved by the profile committee is the prohibition of privatization, concession, lease and management by third parties other than the state. It is also proposed that the GTS operator and the electricity transmission operator be 100% owned by the state.

Already in November, the Verkhovna Rada voted to eliminate inconsistencies in the text of the law . Thus, the MPs prohibited the privatization of underground gas storage facilities.

Oleksii Orzhel, Minister of Energy and Environmental Protection of Ukraine, believes that attracting foreign investments is still a necessary condition for the development of the Ukrainian GTS.

In turn, Andrii Herus, Chairman of the Parliamentary Committee on Energy and Public Utilities, stated that foreign investments in the Ukrainian GS met the interests of the state but, according to the current legislation, cannot be attracted. 

“If investors bring in the investment, new technology, they can preserve gas transit, and we must act in our national interests. Such options should be considered. The only thing I want to remind you is that it is not possible under current legislation. The law we have adopted says that it is 100% state owned. Foreign investors are not envisaged there. This discussion is purely theoretical,” said Herus.

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