Cabinet proposes Rada raises Ukrgazvydobuvannia, Ukrnafta royalties from 20% to 70%

The Cabinet of Ministers has proposed that royalties for subsoil use be increased from 20% to 70% for state-owned Ukrgazvydobuvannia and Ukrnafta with a state stake of 50% plus one share in 2015, Ukraine's Minister of Finance Natalie Jaresko has said.

"This is the change of rental payments for Ukrgazvydobuvannia," the minister said at a briefing, while listing measures to increase budget revenue.

According to Jaresko, this measure should provide additional revenue for the national budget of about UAH 9 billion. She also said it is planned to raise the price of gas produced by Ukrgazvydobuvannia. In her opinion, these measures will allow the funding of subsidies for the public foreseen in connection with the rise in energy tariffs.

Jaresko also noted that the government would consider the issue of changing royalties for private gas and oil companies.

"We will work with interested parties and investors - those who are already working in Ukraine and want to invest to reach the level of royalties, which fiscally gives what we need to the budget, but at the same time stimulates the industry in Ukraine, because we want investment to come to Ukraine and reduce its energy dependence," she said.