On October 23rd in Berlin the Minister of Finance of Ukraine Natalia Jaresko and the First Vice-president and Chief Operating Office of the European Bank for Reconstruction and Development (EBRD) Philip Bennet have signed a guarantee agreement on disbursement of loan by EBRD for financing gas purchases by NJSC “Naftogaz of Ukraine”, Naftogaz’s press-service reports.
The loan agreement was signed by the Chairman of the Management Board of Naftogaz Andrei Kobolev and the Managing Director for Energy and Natural Resources Riccardo Puliti.
The loan funds in the amount of $300 mln are intended for purchase of about 1 billion cbm of gas on the western border of Ukraine. One of the conditions for disbursement of EBRD loan is the implementation by the government of Ukraine of the plan on reforming corporate management of Naftogaz. Having signed guarantees under loan agreement, Ukraine undertook obligations to implement this plan.
“The reform of corporate management of Naftogaz will allow to concentrate on maximum increase of shareholder value to the benefit of citizens of Ukraine. The independent Supervisory Board and improved control mechanisms will contribute to higher efficiency and transparency of the group work. We are grateful to European Commission and EBRD for their active participation in this process. When this plan is implemented, it will demonstrate that even the company with inefficient management can change, if it seriously starts reforming,” said the CEO of Naftogaz.
The EBRD loan is a revolving loan for three years. Within this period Naftogaz can repay and borrow funds again not exceeding this amount in order to finance the forward gas purchases before winter periods. For EBRD the disbursement of such loan is unique, for the first time the mechanism of the revolving loan is applied with state guarantee.
During the preliminary qualification process, which was conducted in compliance with EBRD requirements, many major international suppliers showed their interest in gas supplies to Ukraine as per EBRD terms. Gas supplies under EBRD loan program will be produced under standardized contracts of EFET (European Federation of Energy Traders).
