22.06.2024 Business of Occupiers

Billions for protection against drones and restoration of hydroelectric power plants from Ukrhydroenergo

In 2022-2024, Ukrhydroenergo ordered the installation of drone protection and restoration of various hydroelectric power plants after missile strikes for a total of UAH 10.39 billion. In most cases, the contracts were concluded without tenders, and the finalized lists of resources were not made public.

The state-owned company, which has been headed by Ihor Syrota since 2011, has placed twice as many protection orders as Ukrenergo, which has contracts for the construction of power substation protection worth about UAH 5.4 billion.

Five contractors of Ukrhydroenergo received contracts worth UAH 8.74 billion, which is 84% of the total amount. The leader was Elitstroy-1, which signed the largest contract for the construction of the Dniester pumped storage dam protection worth UAH 4.19 billion. These works are to be completed by the end of 2026. The founders of the Zhytomyr-based company are Vasyl Boyko and Denys Boleyko. The latter was associated with the Cherpytsky brothers, who were called the leaders of the Chepchyky group. This contract is the largest in the company’s history.

The second place was taken by Kyiv-based Garant Energo LLC, which received an order for UAH 2.93 billion. The contract includes the construction of structures to protect the building of HPP-1 at Dnipro HPP and electrical equipment at Kaniv HPP, the installation of drone protection at Kremenchuk HPP, and the restoration of protective covers for hydroelectric units G7 and G8 at Kremenchuk HPP, which were damaged by a missile strike on November 23, 2022.

The founder of Garant Energy is Mykhailo Reva. Together with his son Andriy, he owns companies in various fields: agricultural industry (Nizhynske Farm, Ivangorodske LLC), real estate (M.V. Invest LLC), construction (Garant City Bud LLC, Ukrpromstroyresurs LLC) and electrical installation (Garant Energo LLC, Energo-Smart LLC).

The third place was taken by the Turkish company Altair Loistik Ve Ticaret Anonim Şirketi (Altas), which received an order for 150 and 330 kV cables and couplings for the construction of an integrated underground protective structure to protect the main electrical equipment of the critical infrastructure of the Dnipro HPP in the amount of UAH 868.65 million through open bidding. The company is registered in Antalya. It is owned by the first member of the board, Andrejs Bradens, a Latvian citizen living in the UK, and managed by the CEO, Hamza Kerim, a Turkish citizen. The company is engaged in project management and logistics, and sells machinery and equipment.

The British company Medialed Ltd received an order for a complete 330 kV GIS switchgear for the construction of an integrated underground protective structure at the Dnipro HPP worth UAH 470.61 million through an open tender. The HSG-426A unit manufactured by Hyosung (Korea) will be delivered within 500 days after an 80% advance payment. The company is registered in London and supplies equipment for energy projects. The owner and manager is Maxim Skachko, a British citizen originally from Kyiv. Until 2015, it was called Tiger Telecom Investments Limited.

The rating is rounded out by Energoreshenie LLC with contracts worth UAH 276.38 million. These include the installation of drone protection for the facilities of Kremenchuk and Kaniv HPPs, dismantling of equipment destroyed by a missile strike for the Dniester PSPP, etc. The Kyiv-based company is owned by Kyiv residents Volodymyr Mason and Valentyna Mytchynska, and is managed by Yegor Semenov.

Mason is also the sole owner of Energorishennya LLC and heads the trade union of the engineering and technical staff of the Antonov Aviation Research and Production Complex. The register of “Energoreshenie” contains one phone number +380951088025, which is also used by Valerii Dzhiautov’s Martinonis Alliance LLC and I.C.G. Ukraine LLC, founded by Uzbek Bakhodirjon Teshaboyev, and the ultimate beneficiary is Zoya Yeremina.

Since 2021, Energoreshenie has received tenders worth UAH 436 million exclusively from Ukrhydroenergo.

Each of the private entities received hundreds of millions from the budget to protect Ukrainian hydroelectric power plants after the shelling. At the same time, hundreds of millions of Ukrenergo’s hryvnias have ended up in private pockets while the power system has been restored by only a few percent.

How do Russians influence Ukraine’s energy sector?

In addition, other things are surprising. For example, how does the VS Energy group of energy companies, whose beneficial owners are Russian citizens and sanctioned oligarchs Yevhen Giner, Mikhail Voevodin and Oleksandr Babakov, still own 8 regional power companies, 2 metallurgical plants, and have a direct impact on Ukraine’s energy supply system?

For example, one of the managers of VS Energy, Alexander Babakov, is the Deputy Chairman of the State Duma of the Federal Assembly of the Russian Federation. He has publicly expressed support for the death penalty for foreign nationals who oppose Russia’s aggression against Ukraine, and has also called for the Azov regiment to be recognized as a terrorist organization.

VS ENERGY INTERNATIONAL N.V. itself is registered in the Netherlands, but through its Ukrainian subsidiary, VS Energy International Ukraine LLC, it owns significant assets in Ukraine in the energy, metallurgy and finance sectors.

VS Energy owns 5 regional power distribution companies: “Khersonoblenergo, Kirovohradoblenergo, Zhytomyroblenergo, Rivneoblenergo and Chernivtsioblenergo. VS Energy International Ukraine LLC has corporate rights in three more oblenergos: “Sevastopolenergo, Khmelnytskoblenergo, and Mykolaivoblenergo.

Among the real odious Russian owners, VS ENERGY Ukraine used to have a Ukrainian, the company’s president and businessman Mykhailo Spector. In an interview, the latter said that it was much better for Ukraine to do business with the Customs Union than with the EU. And when asked about a business partner that promotes the Russian world and makes money in Ukraine at the same time, Spector replied: “Our group makes money not only in Ukraine. We do not promote anything. We give our opinion on the matter if we are asked about it.”

The history of the group’s creation can even be found online, according to which, in 2006 in Geneva, Kolomoisky, Bogolyubov, Pinchuk, Voevodin, Babakov and Spector agreed to create a joint ferroalloy holding. The latter are called a “third party” in the decision of the British Themis, and they received 20% of the company. VS Energy top managers Spector and Boris Baum joined the supervisory board of Nikopol Ferroalloy Plant at the same time. In 2013, they were joined by Giner.

So, in the third year of the war, how do people directly connected to Russia and Putin still have influence on Ukraine’s energy system?

 We also asked the law enforcement agencies that initiated criminal proceedings based on our materials, such as the State Bureau of Ukraine – № 12012000060000073 under part 1 of Article 255 of the Criminal Code, part 3, part 4 of Article 190, part 3, part 5 of Article 191, Art. 110(2), Art. 206(3), Art. 209(3), Art. 258-5, Art. 364(2), Art. 365-2, Art. 212(3) of the CCU and the Investigation Department of the Security Service of Ukraine in Chernivtsi region – No. 22024260000000111 under Art. 364(1) of the CCU. But will there be any real results?

Of course, now, at the end of the second year of open war, the dependence of Ukraine’s critical energy infrastructure on the Russians is simply unacceptable. So is the ownership of other expensive and important assets by pro-Putin oligarchs. That is why society expects the government to make decisive decisions to remedy this situation.

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