State-owned UGB Bank (Ukrgasbank) and PJSC Ukrnafta have signed a loan agreement, according to which the company will receive UAH 4 billion to implement an investment program to increase oil and gas production by drilling new wells and building modern gas piston units, as well as to implement cogeneration projects, the state bank’s website reported on Friday.

“It is planned to use the funds raised to finance drilling and production intensification programs, the construction of modern gas piston stations,” the press release quotes Ukrnafta Director Serhiy Koretsky as saying.

In turn, Acting Chairman of UGB Bank Rodion Morozov noted that the loan funds would strengthen the Ukrainian energy system after losses due to enemy attacks.

Information about the loan term and interest rate is not disclosed.

According to the National Bank of Ukraine (NBU), as of July 1, 2024, Ukrgasbank ranked fifth in terms of total assets (UAH 190.88 billion) among 62 operating banks. The financial institution's net profit in 2023 amounted to UAH 1.94 billion.

Ukrnafta is the largest oil producing company in Ukraine, it is the operator of the national network of gas stations. In March 2024, the company took over the management of Glusco assets and operates a total of 545 gas stations - 460 of its own and 85 under management.

The company is implementing a comprehensive program to resume operations and update the format of its filling stations. Since February 2023, Ukrnafta has been issuing its own fuel vouchers and NAFTACard, sold to legal and physical entities through Ukrnafta-Postach LLC.

The largest shareholder of Ukrnafta is NJSC Naftogaz Ukrainy, holding a 50% plus one share. In November 2022, the Supreme Commander-in-Chief of the Armed Forces of Ukraine decided to transfer the corporate rights shares owned by private stakeholders to the state, currently managed by the Ministry of Defense.