Ivano-Frankivsk City Council has rejected a project for the construction of a geothermal facility by limited liability company Geothermal (Ivano-Frankivsk).

"The investment projects proposed by Geothermal LLC on building, drilling and launching a geothermal facility in Ivano-Frankivsk is rejected," reads a decision of the session of the city council held on June 6, 2013.

The city council also canceled two decision of the city executive committee of May 25, 2007 and July 27, 2007 on permitting Geothermal LLC to collect materials for agreeing on the location of two land plots to build the facility with a gross area of around two hectares in Stusa Street and at the intersection of Symonenko and 24th August streets.

The council rapporteur - member of the permanent lawmaker commission in housing and utilities issues Yaroslav Bachkur - said at the session that lawmakers doubt the practicality of the project, the realization of which would require several hundred million hryvnias. The lawmaker said that Geothermal LLC, with a charter capital of UAH 500,000, was registered by four individuals on April 24, 2007, although it was unclear if the founders had put the said funds in the charter capital.

"The issue is suspicious one: could investors seek to legalize the ownership rights to attractive land plots, and later delay the realization of the project and alter the purpose of the land use and build other facilities on it? The possible outcome is a whole lot of nothing for the community, while several millionaires will appear," Bachkur said.

He said that the city executive committee started the this non-transparent mechanism. In 2007, the committee permitted Geothermal LLC to carry out design and exploration works at two land plots without a thorough examination of the project and the relevant permission of the session. With the decisions of the city executive committee, Geothermal via the courts is trying to put pressure on the city council to allocate the land plots for the realization of the project, he said.

The lawmaker also read the conclusions of scientists of Ivano-Frankivsk National Technical University of Oil and Gas on the appropriateness of the realization of the project on the construction of a geothermal facility in Ivano-Frankivsk. According to the conclusions, despite the positive sides of the project linked to the use of alternative sources of energy for the housing and utilities sector, the building of two water wells 4,000 meters deep in a densely populated residential district of Ivano-Frankivsk without a thorough study of economic, manmade and ecological risks was inadmissible. They also said that the project requires additional tuning.

As reported, it is planned to realize a project on the construction of a geothermal facility in Ivano-Frankivsk to receive alternative source of energy for the housing and utilities sector of the city. The cost of the project is EUR 12 million.