Starting in 2027, Ukraine will launch a pilot project for the underground storage of petroleum products from the minimum reserves of oil and petroleum products (MROPP), according to Cabinet of Ministers Resolution No. 1037 dated August 13, 2026, published on the government portal.
According to the resolution, the pilot project, initiated by the Ministry of Energy, is to last no more than two years.
“Starting from the beginning of the third base year (2027), market participants and operators are required to store a portion of diesel fuel—amounting to at least 20% of the total volume of this type of petroleum product—from the MRPS in underground petroleum product storage facilities,” – states the procedure for implementing the pilot project attached to the resolution.
The project provides for the creation of an extensive system of underground petroleum product storage facilities and conditions for their safe storage, as noted in the procedure.
The Ministry of Energy has been designated as the coordinator of the pilot project, and JSC “Ukrtransnafta” as the specialized responsible storage operator.
At the same time, the operation of the specialized responsible storage operator grants other market participants the right to store petroleum products in their own underground storage facilities.
The list of state-owned facilities whose property may be used as underground storage facilities is specified in the confidential section of the resolution.
The Ministry of Energy must ensure the implementation of the project in cooperation with, among others, NJSC “Naftogaz of Ukraine,” “Ukrtransnafta,” and the “Market Operator.”
Serhiy Kuyun, director of the consulting firm A-95, commented on the pilot project, noting that there are currently no underground storage facilities in the country, and that with only four months remaining before the deadline, no one will even have time to develop a project. At the same time, he pointed out that the resolution provides for the use of oil pipelines, salt caverns, depleted oil or gas fields, and other geological formations for these purposes.
Kuyun also noted that in the near future, state-owned banks, by government decision, may begin providing loans for underground petroleum product storage facility projects at 10% per annum, with the state compensating for the remaining interest. According to his information, the loan amount could range from 100 million UAH to 1 billion UAH. At the same time, Kuyun suggested that in such cases, a strict condition would be imposed requiring the storage facilities to be put into operation within a year.
However, in his opinion, a year is an unrealistic deadline, so the government needs to speed up the approval of project documentation, a process that currently takes one to one and a half years. The director of A-95 also noted that private gas station network operators have already begun construction of underground storage facilities “at their own risk,” while simultaneously seeking approval for their projects.
He also drew attention to the broader issue of MZNN storage starting in 2027.
“The law (on MZNN), although blocked by subordinate regulations, is formally in effect, and currently the MZNN quota stands at 6% (of the market—ER), or approximately 600,000 metric tons. This is a volume that physically has nowhere to be stored—neither underground nor above ground. And no one is going to store it on land, because that would be business suicide. If nothing changes, the quota will automatically increase to 9% starting in 2027,” Kuyun explained.
He added that the Ministry of Energy understands the problem and has prepared amendments to the law, which already number 300.
“The positions are as follows: everyone, without exception, understands the main point—reserves are necessary, but they must be protected. And these reserves must remain in Ukraine; fantasies about storing them abroad are quickly dispelled,” the director of A-95 concluded.
As reported, parliament passed the MZNN law on November 21, 2023.
The explanatory note to Bill No. 9024-d stated that its adoption would allow for the creation of a system of minimum reserves of crude oil and petroleum products in Ukraine and would regulate relations in the sphere of managing such minimum reserves, as well as ensure Ukraine’s compliance with its obligations regarding the implementation of Directive 2009/119/EU.
According to Vasyl Danylyak, CEO of OKKO Group, establishing minimum oil and petroleum product reserves is only feasible once Ukraine has a sufficient network of underground storage facilities.
FUEL, petroleum product, storage facility, UKRAINE, UKRTRANSNAFTA
On March 10, Ukrtransnafta JSC announced its intention to conclude a contract with VUSO Insurance Company for compulsory civil liability insurance for owners of land vehicles (CMTPL).
According to the Prozorro electronic public procurement system, the company’s price offer was UAH 1.106 million against the expected cost of UAH 1.255 million.
The tender was also attended by insurance companies Kraina with an offer of UAH 1 more, Arsenal Insurance – UAH 1.191 million.
Ukrtransnafta CEO Volodymyr Tsependa and Asset Recovery and Management Agency (ARMA) head Olena Duma signed an addendum to the current agreement on managing the Ukrainian section of the Samara – Western Direction” (SZN), which provides for an increase in the company’s monthly payments to the state budget from UAH 1.1 million to UAH 5 million.
“The focus is on responsible management of part of the Samara-Western Direction oil product pipeline in the new security environment of 2025,” Ukrtransnafta said on Facebook on Friday.
According to the company, the decision takes into account the updated operating conditions of the facility and is aimed at improving its efficiency.
“We view the management of this facility not only as an operational function, but as the company’s responsibility to the state to work efficiently, transparently, and results-oriented,” Tsependa said.
Ukrtransnafta emphasized that the parties had demonstrated a common position: to act proactively, ensure the continuous operation of critical infrastructure, and transparently manage state property.
As reported, the Ukrainian section of the SZN had long belonged to Prikarpatzakhidtrans LLC (Rivne), but as a result of court proceedings, it was returned to state ownership in early 2021. Ukrtransnafta won the tender for its management and in September 2021 received all the necessary documents for the operation of the Ukrainian branch of the SZN and confirmed its readiness to resume its work.
After the start of the full-scale Russian invasion, given the impossibility of resuming the operation of the oil product pipeline in the planned direction of pumping oil products from Belarus, as well as the need to ensure the state’s defense capability to meet the needs of the Armed Forces of Ukraine in wartime, Ukrtransnafta began pumping diesel fuel in reverse from Hungary to Ukraine.
Ukrtransnafta, 100% of whose shares are managed by Naftogaz of Ukraine, is the operator of the country’s oil transportation system.
In 2023, Ukrtransnafta’s net profit increased by 40% to UAH 5.6 billion. In 2024, the company paid UAH 5.29 billion in dividends to its shareholder, Naftogaz of Ukraine, based on its performance in 2023.
On May 22, Ukrtransnafta (Kyiv) announced a tender for liability insurance for business entities and other legal entities that use high-risk facilities for damage that may be caused as a result of emergencies.
According to a notice in the Prozorro electronic public procurement system, the expected cost of the services is UAH 693,760 thousand.
Documents will be accepted until June 2.
Ukrtransnafta, 100% of whose shares are managed by Naftogaz of Ukraine, is the operator of the country’s oil transportation system.
JSC “Ukrtransnafta” has increased its stake in PJSC “Insurance Company Transmagistral” from 91.99% to 98.45%, according to the company’s information posted in the information disclosure system of the National Commission on Securities and Stock Market (NCSSM). As reported on February 28, 2025, IC “Transmagistral” has increased the authorized capital to UAH 248 million by conducting an additional issue for the amount of UAH 200 million Additionally, 20 million shares with a par value of UAH 10 for the amount of UAH 200 million were sold.
As reported, the decision on the issue was made by the shareholders at the meeting on November 29, 2024.
Earlier, the National Bank of Ukraine agreed to the state of Ukraine indirect ownership of 92.4059% of shares of PJSC Insurance Company Transmagistral. Prior to that, on January 8, the NBU confirmed the company’s ownership structure compliance with transparency requirements.
As noted on the company’s website as of Q3 2024 the shareholders of the company were JSC “Ukrtransnafta” – 91,992%, Primary trade union organization of JSC “Ukrtransnafta” (Kremenchug, Poltava region) – 5,1%.
IC “Transmagistral” was registered in 2003, specializes on rendering services in the sphere of risk insurance.
JSC “Ukrtransnafta” and IC “Arsenal Insurance” (both – Kiev) have concluded a contract of compulsory insurance of civil liability of owners of land vehicles (MTPL).
According to the message in the system of electronic public procurement Prozorro, the price offer of the company was UAH 627,658 thousand with the declared in the system UAH 1,433 million.
Insurance companies IC “VUSO” with the offer of UAH 607,352 th. and SG “TAS” – UAH 775,049 th. also took part in the tender.
IC “Arsenal Insurance” is the legal successor of IC “Arsenal-Dnepr”, operating in Ukraine since 2005. It is represented in all regional centers and some large cities of the country.
