Ukraine, US to drill for oil in the Black Sea

(ForUm) - Negotiations are continuing between the Ukrainian government and the Houston-based Vanco Energy Company for the right to drill for oil in the Black Sea, RFE/RL reported.

Talks on the tender, which would be the first granted to a Western investor in Ukraine's oil-and-gas sector, took place on December 6 in New York on the sidelines of a business forum aimed at attracting U.S. investors to Ukraine. Negotiations are expected to end in January 2007, reports Trend.

Ukraine could net billions of dollars if the deal goes through. If signed, Ukraine would get at least 51 percent of the future profits from the production-sharing agreement (PSA). But there has been speculation that the negotiations have stalled and that Russia's state-controlled gas giant, Gazprom, may become Ukraine's partner in the project.

Ukraine's Fuel and Energy Minister Yuriy Boyko denied that the Ukrainian government is interested in Gazprom's participation.

"There are always topics of dispute when negotiating a project of such magnitude but I do not doubt that we will find a compromise," Boyko said. "The negotiations with our partners [Vanco Energy] have demonstrated that we are close to [a deal]. By the end of January [2007] we will sign an agreement."

Vanco Chairman Gene Van Dyke also downplayed rumors of significant differences between his company and the Ukrainian government.

"I think there are only rumors, I've heard nothing of that from the official point of view, we've been awarded the tender and you've heard what the minister [Boyko] said. We're negotiating constructively to finish an agreement within the time allowed," Van Dyke said.

Vanco itself does not have the capacity to conduct seismic-exploration drilling at a depth of over 600 meters below sea level. Instead, it will hire subcontractors for the job.

"The type of terms we hope to achieve once it's agreed -- and it's not yet agreed -- would fall in the middle range of production-sharing agreements around the world," Van Dyke said of the project. "It will be certainly compatible with other agreements in what I would call 'frontier exploration areas' and 'areas of deep water,' which has additional mechanical risks and cost involved."

The tender is being negotiated for a period of at least 30 years with possible 10-year extensions.

But questions have been raised about Ukraine's business environment -- in particular, corruption.

Western investors are eying the Vanco tender as a test for Ukraine's commitment to liberalize its economy and to introduce much-needed transparency.

Van Dyke says that he doesn't see political risks because the contract is too big and too important for Ukraine.

As for Ukraine's high place on the annual Transparency International Corruption Perceptions Index, Van Dyke says that he sees no problem with that either.

"I'm aware of that, I've seen that index," Van Dyke said. "I don't feel the influence of that in this project. This contract has the advantage of being very large and very visible and very important to the government and to us, so, that adds transparency."

Subscribe to Trend in Google News! Subscribe
Truck collides with passenger bus in Baku (PHOTO)
Truck collides with passenger bus in Baku (PHOTO)
Nizami Ganjavi International Center hosts side event as part of UN General Assembly's 76th session  (VIDEO)
Nizami Ganjavi International Center hosts side event as part of UN General Assembly's 76th session (VIDEO)
Indian gov't says 75 pct of stolen heritage returned during last seven years
Indian gov't says 75 pct of stolen heritage returned during last seven years
Loading Bars
Latest
Azerbaijan sees growth in cotton products export volume for 10M2021
Four factors to shape next steps of OPEC+ in 2022
RBI pegs GDP growth at 9.5%, inflation at 5.3% for 2021-22
Oil market lagging behind that of natural gas in terms of balances
Azerbaijan identifies remains found in Caspian Sea
Azerbaijan notably increases export volume of plastic products for 10M2021
Dangerous to fully trust accuracy of minefield maps provided by Armenia - Azerbaijani president's special representative
Azerbaijan plans to rebuild ‘Imarat’ stadium in Aghdam - special rep of president
India's Ola Electric raises $200 mn funding, valuation touches $3 bn
SOCAR AQS completes drilling of another well at Gunashli field
Biggest cement exporters to Georgia revealed
Iran’s IAC shares data on activities of airports in Ardabil Province
Turkmenistan commissions new gas field
Bitcoin demonstrates sustainability as financial resource - FARI Solutions
Georgia releases COVID-19 data for December 9
Georgia’s sheep exports down
Indian RBI sees GDP growth at 9.5% but warns of Omicron risk
GECF intends to create an Electronic Trading Platform
Byju's buys Austrian math-learning co GeoGebra
Azerbaijani oil prices increase change
Azerbaijan to be represented by Deputy Foreign Minister Khalaf Khalafov at 3+3 format meeting
General Bipin Rawat played key role in cementing India-US defence ties: US
Bangladesh: Shringla calls on Sheikh Hasina, discusses forthcoming visit of President Kovind
Kazakh gas producing company opens tender to buy steel pipes
Kazakhstan begins construction of new ferroalloy plant in Ekibastuz
Cargo movements in Iran's Fereidoonkenar port down
Iran sees increase in exports via customs of West Azerbaijan Province
SOCAR among main suppliers of motor gasoline produced by ORLEN to Ukraine
First meeting of cooperation platform in 3+3 format to be held in Moscow
Azerbaijan plans to begin formation of legal framework for open banking in 2022 (PHOTO)
Kazakhstan’s oil and gas company opens tender for equipment repair
Azerbaijani, French ambassadors discuss results of Sochi meeting in Russia
U.S.-Israeli firm Tipalti raises $270 mln at more than $8 bln valuation
Uzbekistan shares domestic COVID-19 data for December 8
Georgia’s wine export volume reaches historical maximum
Iranian currency rates for Dec. 9
Armenian provocation near border results in death of Azerbaijani soldier
Iran reaches new record in daily gas transportation
Oil stays on the rebound as Omicron fears ease
Russia’s Astrakhan developing transportation of goods along North-South int’l transport corridor - governor
6.0-magnitude quake strikes Japan's Kagoshima Prefecture
Japan's COVID-19 cases defy Asia rebound, yet fears remain for winter wave
Steps being taken to build new bridge over Astarachay between Azerbaijan and Iran – ambassador
Kazakh economic growth accelerates to 3.8%
U.S. envoy to return to Vienna over weekend for Iran talks
UK, Canada join diplomatic boycott of Beijing Winter Games
Russia plans to deliver another batch of S-400 systems to Turkey - Kremlin spokesman
Burkina Faso president fires PM amid security crisis
Pres. Raisi: Iran-Turkey cooperation to enter new phase
Seven U.N. peacekeepers killed in central Mali explosion
Bayern Munich 3-0 Barcelona: Xavi's side crash out of Champions League
Erdogan praises new economy model, calls for trust in policies
Olaf Scholz elected new German chancellor
Georgian gov't allows Covid-19 booster five months after last shot
Turkey’s COVID-19 numbers decrease despite winter worries
Georgia shares data on most exported goods to Azerbaijan
Iran RIPI among 25 leading patent holders in oil, gas nanotech
Johnson imposes COVID-19 'Plan B' in England to contain Omicron
Azerbaijan-Iran to take steps to increase trade turnover – Iranian ambassador
Pfizer, BioNTech vaccine neutralises Omicron with three shots
Azerbaijan proposes new version of budget rule – minister
Azerbaijan working to prepare Budget Code
Iran is ready to start co-op with Azerbaijan, Russia in synchronization of power grids - minister
Azerbaijan appoints new president of Wrestling Federation
EIB, EBRD assess financing opportunities for Georgian business
Central Bank of Azerbaijan puts into circulation new 20 qepik coin
Turkmenistan launches production of Shir deri branded shoes
Uzbek Statistics Committee publishes leading regions in terms of food production
Georgia seeks funding for underground gas reservoir construction
Uzbek Commodity Exchange announces its weekly quotes of commodities for export
Tactical-Special Exercises held in Azerbaijani Nakhchivan (PHOTO/VIDEO)
Iran and Syria to launch a joint mercantile exchange
Central Bank of Azerbaijan to put into circulation new 20 manat banknote soon (PHOTO)
Iran discloses amount of money provided for purchase of agricultural machinery
Russia’s Astrakhan Business Center in Baku to attract businessmen, humanitarian reps - governor
Oil prices expected to strengthen again in 2023
Iran`s Khodro, Saipa automakers receive green light to raise prices on cars
Azerbaijan shares predictions on GDP growth rates for 2022-2026
Iran's Bahar Azadi gold coin prices dip
Indian Oil Corporation renews deal to buy up to 2 MT of oil from Russia's Rosneft
Azerbaijan boosts chemical exports for 10M2021
Foreign Secretary, Bangladesh Foreign Minister discuss COVID-19 cooperation
Number of passenger planes received by Iran’s Gorgan International Airport up
Baku State University opens tender for security services
Indian DRDO carries out successful test firing of surface-to-air missile
Turkey ready to mediate to reduce tension between Russia, Ukraine – President Erdogan
Kazakhstan shares forecast on oil production volume by 2030
Iran produces 5 million doses of domestic Noora COVID-19 vaccine
Bahrain parliament approves value-added tax increase to 10%
Challenge for OPEC+ beyond 2022 may shift towards managing upside risks
Israel budget deficit falls to 4.6% of GDP yr/yr in November
Gas withdrawal from European UGS 19% above average in December — Gazprom
India develops AESA radar to make IAF fighters more lethal
Iran`s National Development Fund voices readiness to back mega projects
Iran's trade with China declining
Iran seeks to boost trade with Syria through private sector
Pfizer, BioNTech vaccine neutralises Omicron with three shots
Red Cross to build regional logistics hub in Georgia
Kazakhstan reports increase in purchase prices for new housing
SOCAR Petroleum among largest taxpayers in Ukrainian fuel market
All news