01.02.2025
Business of Occupiers
Ecology
Ukraine’s gas fields are in the hands of oligarchic groups. How the State Service of Geology and Subsoil manipulates special permits
Much of Ukraine’s oil and gas resources have come under the control of financial and industrial groups linked to Russia. Obviously, access to the country’s natural resources is one of the biggest temptations for big businessmen and oligarchs. Therefore, private enterprises associated with the latter systematically receive permits for mining, which not only harms the economy but also exposes the country to serious environmental and security risks.
In particular, from 2012 to 2013, the State Service of Geology and Subsoil of Ukraine issued 19 special permits for the use of subsoil to Golden Derrick LLC. At first glance, these permits appeared to be granted in accordance with the law, but a closer look at the case revealed violations in the issuance procedure. Moreover, the permits were granted contrary to the resolutions of the Cabinet of Ministers, as Golden Derrick did not meet the requirements for the minimum share of state capital in the authorized capital of the company.
Thus, according to the investigation, Golden Derrick LLC was established in 2007 with the participation of PJSC NJSC Nadra Ukrayiny and the Austrian company Lifo Invest GmbH. Already in 2012, contrary to the requirements, three special permits were obtained, and later, in 2017, 19 oil and gas production permits were renewed on the basis of court decisions and false data.
Subsequently, Golden Derrick LLC was renamed into East Legal Petroleum LLC, which then created a number of new companies to legalize the illegally obtained permits. As a result, 20% of Ukraine’s projected gas reserves have come under the control of financial groups linked to Russia.
A striking example is the activities of Global Geo Invest LLC, which controlled the North Pereshchepynske field until 2021. However, a week after receiving the permit, the company was forced to return the special permit due to NSDC sanctions. However, it did not give up hope of appealing the decision in court.
Manipulations with auctions
The minutes of the auction for a special permit for the use of subsoil for well No. 2, located in Zaporizhzhia, indicated that the winner was a single participant, BALTA LLC, although in fact, according to all the rules, at least several participants should have been present at the auction, which would have ensured competition. A similar situation arose with other auctions, for example, with the Zhalianska-2 field in Rivne region, where only one company, Holland Group, won despite numerous potentially interested parties.
At the same time, auctions related to the extraction of mineral waters in the Berdiansk region had only one participant, a company, which, unfortunately, raises suspicions among those who have experienced market manipulation before.
“Unigran“ as part of Shapran-Naumets’ Russian business
In September 2023, a business agreement was signed in Istanbul between Russian oligarch Igor Naumets and Ukrainian businessman Serhiy Shapran. Under the terms of the memorandum, Naumets transferred half of his business empire to Unigran in exchange for “legal support” from Shapran. This step looked like an attempt to hide the real owner of the business and maintain control through Ukrainian structures.
Importantly, after the business was “rebooted,” Naumets continues to receive a portion of the profits earned from Ukrainian subsoil.
But the story does not end there. In November 2024, the Pecherskyi District Court of Kyiv seized the accounts of a number of companies used to circumvent sanctions, but this did not stop the companies’ operations. Instead of stopping their operations, the companies’ managers simply opened new accounts and continued to operate under different names and with new details.
Although officially these companies can no longer operate under the Unigran brand, they still continue to operate, supplying construction materials to the Ukrainian market. In particular, through companies such as:
- Uni-Lux LLC – sales of paving slabs for UAH 133 million;
- Uni Stone Plenty LLC – sale of crushed stone for UAH 205 million;
- Uni Service LLC – supply of explosives for UAH 75 million;
- Budindustriya Service LTD – sale of sand for UAH 109 million.
What is even more disturbing is that even government organizations did not ignore the products on the sanctions list. For example, tiles for the Zhytomyr City Council, crushed stone for the Kyiv Zoo, sand for the Housing and Utility Company No. 3 – these are just some of the cases when state structures purchased products from companies associated with the sanctions schemes of Shapran and Naumets.
At the same time, officials of the State Service of Geology and Subsoil of Ukraine simply turned a blind eye to the open connection with Russia and only facilitated the illegal granting of special permits for hydrocarbon production to controlled companies.
It is worth noting the changes that have taken place in the geological industry since the appointment of R.E. Opimakh as the head of the State Service of Geology and Subsoil of Ukraine in 2023. His activities are actively supported by the government, and a significant part of the reforms under his leadership relate to market legalization, improvement of auction processes, and the fight against corruption.
At the same time, officials of the State Service of Geology and Subsoil of Ukraine simply turned a blind eye to the open connection with Russia and only facilitated the illegal granting of special permits for hydrocarbon production to controlled companies.
It is worth noting the changes that have taken place in the geological industry since the appointment of R.E. Opimakh as the Head of the State Service of Geology and Subsoil of Ukraine in 2023. His activities are actively supported by the government, and a significant part of the reforms under his leadership relate to market legalization, improvement of auction processes, and the fight against corruption.
Certain companies, such as ELION INVEST LLC, NAYER COMPANY LLC, PRICE COMPANY LLC and others, continue to try to obtain their permits through manipulation of registers and submission of forged documents with the participation of high-ranking officials.
Thus, due to the illegal distribution of natural gas production permits, significant resources of the country have ended up in the hands of affiliated entities that are likely to have ties to the aggressor country. In addition, these illegal operations have complicated the implementation of Ukraine’s strategy to increase its own gas production, which limits the country’s energy independence.
As a result, part of the projected gas reserves – about 35-40 billion cubic meters – are now under the control of private individuals who may be interested in delaying the hydrocarbon production process. This means that the country will face significant economic losses and further energy dependence on external suppliers.
We have already sent the relevant materials to law enforcement agencies. We are waiting for the response and measures to be taken by the controllers.
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