Naftogaz’s default will give serious grounds to change the Prime Minister and the Government

Volodymyr Omelchenko, the director of energy programs at Razumkov Center, believes that the default of Naftogaz and the very rumours about its default create risks for the country's investment rating, because Naftogaz is a key Ukrainian company.

He shared his opinion in the air of Espresso.

"Indeed, Naftogaz raised large funds, but these funds were intended for gas production projects. The idea was that the funds are taken and invested in gas production, as a result of the increase in domestic gas production, loans are repaid, and Naftogaz also earns some profit. But the increase in gas production has not happened, even in the pre-war period, and now, overall production is decreasing quite rapidly: this year, it fell by 10%. Accordingly, Naftogaz has no sources to repay the loans," the energy expert said.

Volodymyr Omelchenko noted that the best option would be to restructure Naftogaz's debts, but it is difficult to say whether investors will agree, and serious negotiations should be started with creditors on this issue.

"The default of Naftogaz and the rumours themselves create risks for the country's investment rating, because Naftogaz is the key largest Ukrainian company. Naftogaz is state-owned, so, it is the government's responsibility. When the manager is bad, the company's management should be changed and an appropriate supervisory board should be created, for the company to be managed better. If Naftogaz defaults, it will be a serious reason for Shmygal's removal from prime minister’s office, along with the whole government," Mr. Omelchenko said.

Volodymyr Omelchenko

Director, Energy Programmes

Born in 1967 in Kyiv

Education: Kyiv Politechnic Institute, Department of Chemical Engineering (1992)

Author of over 50 scientific works and op-ed publications. Took part in development and implementation of international energy projects and scientific research in international energy policy


1992 – 1996 — worked in different positions in the mechanical engineering industry

1997 – 1998 — Head Expert of the Division of Oil, Gas and Petroleum Refining Industry of the Ministry of Economy of Ukraine

1998 – 2003 — Naftohaz Ukrayiny National Joint-Stock Company, in Charge of Oil Transportation Section

2004 – 2007 — Chief Consultant at the National Institute of International Security Problems of Ukraine’s NSDC

since February, 2007 — Leading Expert, Razumkov Centre. Director of Energy Programmes since 2013

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