Minerals deal with US opens up new prospects for Ukrainian companies, but possible risks must also be assessed – Zakhidnadraservice founder
The agreement on minerals with the US potentially opens up new opportunities for Ukraine and Ukrainian companies, in particular, in the direction of energy independence, healthy competition, improvement of the legislative and regulatory field, but there may also be certain risks under the condition of an asymmetric partnership in favor of the US, believes founder of the Zakhidnadraservice group of companies Zynoviy Kozytsky.
"Expectations are more realistic: we would definitely like this to be progress and development for Ukraine, and for Ukrainian companies – another "window of opportunity", that is, a guarantee of market stability. Another point – hypothetically we can count on an increase in the state's demand for hydrocarbon extraction, which will mean healthy competition, less imports, and therefore a step towards energy independence," said Kozytsky in response to a request from Interfax-Ukraine.
In his opinion, it is important that the US representative in this agreement is DFC – a corporation that provides insurance against military and political risks. As he noted, this will help avoid situations when foreign contractors refuse to cooperate due to lack of insurance, as happened with the Belgian crane company, which refused to build a wind farm for Kozytsky's company during the war.
"There is hope that this will become a thing of the past. Ultimately, DFC is a powerful reputational signal," the founder of Zakhidnadraservice believes.
At the same time, he suggested a possible simplification of conditions for business in the subsoil use sector, improvement of Ukrainian legislation, as well as auditing in this area.
"Probably (there will be simplification), since there will be an indirect impact, and the results of various processes that this agreement launches, in particular reforms and changes. No foreign company will enter an environment of risk, uncertainty or opacity. Obviously, agreements of this type have clear accompanying recommendations, including legislative ones, obviously an audit," Kozytsky noted.
In addition, according to him, there could potentially be flexible conditions for raising funds for Ukrainian companies, a change in the regulatory environment.
He also believes that with the agreement "the problem of unfair subsoil use (in particular, "dormant" licenses) or speculation on this topic should disappear."
Kozytsky also expressed his belief that Ukrainian companies can be quite competitive alongside foreign ones.
"My vision of the situation is quite optimistic: our companies are flexible and determined, we just need to work actively, invest in development, in innovation, believe in ourselves and the country - and there will be a positive result," said the founder of Zakhidnadraservice.
At the same time, in his opinion, the agreement may carry a number of risks for Ukrainian companies, if, let's assume, there is an asymmetry in the partnership between Ukraine and the USA in favor of the latter.
"Will American companies be able to receive preferences (simplified procedures and competitive conditions, changes in regulations, quotas), will there be restrictions on access to new licenses, will there be reservations of the best deposits for joint projects with the USA, will large American companies enter our market through the purchase of Ukrainian companies or their shares - this is unknown and is a matter of time," Kozytsky emphasized.
In addition, according to him, it is important that investors from European countries do not perceive the agreement as a division of resources between the United States and the state, which would reduce their desire to cooperate.