The Environment Ministry has ordered that the State Geological Survey annul the license for subsoil use issued to Vanco Prickerchenska Ltd., an affiliate of Vanсo International. Under the license, the company was entitled to carry out exploration works and pilot commercial development on Prykerchenske oil and gas field in the Ukrainian portion of the Black Sea, close to the Crimean city of Kerch. The Ministry’s resolution has been published on its official web-site.

The Ministry said there had been serious grounds for the revocation of the license, but did not specify their nature.

In 2006, Vanco International Ltd. won Ukraine’s first open tender for subsoil use and in October 2007, signed a production sharing agreement for Prykerchenske field. According to the agreement, Vanco International ceded its rights for the field to its affiliate Vanco Prickerchenska Ltd.

UNIAN reference: Both Vanco Prickerchenska Ltd. and Vanсo International Ltd. are affiliates of Houston-based Vanсo Energy Company which specializes in offshore oil exploration and deep-see drilling.

Prykerchenske field with an area of 12,960 square kilometers is a promising but scantily explored part of the Ukrainian outer continental shelf. The water depth over the field is between 300 meters and 2 kilometers. The field is located in Ukraine’s economic zone 13 kilometers off the Crimean cost.

The agreement with Vanco was signed for 30 years. Ukraine expected Vanco to invest over $15 billion in oil and gas exploration and development and to produce over 200 million tons of oil on the field. If the investment plans are implemented, the state budget will receive over 200 million hryvnias in additional revenue and several thousand new jobs will be created.