Ukraine – overview
Facts about Ukraine
Form of government: Republic
Administration: Run by President Petro Poroshenko, who is elected for a five-year term. Elections to the Ukrainian parliament, Verchovna Rada, are held every five years.
Area: 603,628 km²
Population: 46 million
Key drivers in Ukraine
- Ukraine is one of Europe’s biggest energy consumers
- The country has been producing oil and gas since the early 1900s and because of its geographic location, the country plays a central role in Europe’s energy supply
- Ukraine has an unsustainable energy balance, where nearly two thirds of the country’s oil and gas consumption is imported while only 5 procent of the offshore resources have been exploited.
- The annexation of the Crimea and the conflict in Eastern Ukraine have affected the country and its economy. The new president Poroshenko has initiated a modernisation of the country and deregulation of the legal system and the business environment
- Zhoda Investments’ production at the Lelyaki field is stable and unaffected by the geopolitical development in Ukraine
The development in Ukraine
In 2014 Crimea was annexed by the Russian Federation. Certain assets, among them those belonging to the company’s partner CNG, have been nationalised. The annexation and the nationalisation is a violation of the Ukrainian constitution and neither of them has been recognized by the government in Kiev or the Western community. The State of Ukraine and CNG are currently running legal proceedings against the Russian Federation. Due to the events described above, the board of directors of Zhoda Investments perceives an increased risk regarding potential future financial benefit from the Joint Investment Agreement (JIA) with CNG.
The producing field Lelyaki is situated in Central Ukraine and the production is unaffected by the development in Eastern Ukraine and the Crimea.