Ukraine Approves Naftogaz Ownership Policy

Ukraine's cabinet of ministers has approved a new ownership policy at Naftogaz in line with OECD standards, setting energy market reform as a key goal and emphasising the independence of the gas supplier's supervisory board, the company said on October 21.

The policy determines the state's main purposes for owning Naftogaz, including ensuring "successful transformation of the energy sector and completion of the reform of the Ukrainian natural gas market." Other goals include ensuring secure gas supply to Ukrainian consumers; weaning the country off gas imports; and protecting Ukraine's interests in domestic and international markets. This might be a reference to work done in Washington by lobby groups such as Yorktown on behalf of Naftogaz, which has led to sanctions on Nord Stream 2 companies.

The state has undertaken to implement a corporate governance system that follows OECD guidelines that allows the supervisory board to "fulfil its duties and that respects its independence."

The approval of the new policy comes after US businessman and former diplomat Amos Hochstein resigned as an independent director at Naftogaz's board earlier this month, expressing his frustration with resistance to reforms and political interference.