A subsidiary of the US oil company Vanco will appeal a decision by Ukraine’s government to revoke its license at the Stockholm arbitration tribunal, a Ukrainian official said on Wednesday.
Ukraine revoked the oil and gas license of Vanco International, a subsidiary of Vanco Energy Company, on April 25. “Today I learned that Vanco Prykerchenska has applied to the Stockholm arbitration tribunal,” said Yevgeniy Korniychuk, first deputy justice minister of Ukraine Wednesday.
Vanco International signed a 30-year production sharing agreement with former premier Viktor Yanukovych’s government in October 2007, covering the Prykerchenska area just south of the Crimean peninsula. Under the deal, the company received a 65% stake and Ukraine 35% at the prospecting and development stage. The sides were to go 50-50 with the launch of commercial production. Vanco International eventually transferred its rights to the Black Sea shelf development to its subsidiary, Vanco Prykerchenska Ltd., which started to prospect hydrocarbons at the Prykerchenska bloc from the fall of 2007.
However, the Ukrainian government said this move violated the terms of an agreement with the US oil company and revoked the license. Vanco earlier said it wanted to resolve the conflict amicably, but did not rule out resorting to international arbitration. (rian.ru)