Yuzgas BV looks set to acquire 90% in the Yuzivska permit from state company Nadra Ukrainy's wholly-owned subsidiary Nadra Yuzivska. A draft order to approve the transaction was submitted to Cabinet on 9 February 2018. Yuzgas is primarily funded by NAFTA of Slovakia, and will pay US$ 4 million initial consideration, with further contingent payments of US$ 5 million when cumulative output reaches 1 billion cubic metres gas (Bcmg) equivalent to 35 Bcfg, US$ 10 million at 3 Bcmg (106 Bcfg), and $21 million at 5 Bcmg (177 Bcfg), for a potential total deal value of US$ 40 million. Yuzgas was formed by Emerstone Capital Partners and successfully bid to farm into Yuzivska in August 2016, but the transaction was rejected by Ukraine's Cabinet of Ministers on 2 November 2016. NAFTA confirmed it would enter the Yuzgas partnership in August 2017, reviving the proposed farm-in. Yuzgas has pledged to invest US$ 200 million during its first five years in the licence, but will also benefit from US$ 80.1 million spent on exploration by Nadra Yuzivska, of which US$ 27.2 million will reportedly be reimbursed to Yuzgas. Yuzivska spans 7,886 sq km in the N of Donetsk Oblast and the SE of Khar'kov Oblast, within the Dnieper - Donets Basin. The block was originally offered for shale gas exploration in 2012, but also has conventional prospectivity. A 50 year PSA was awarded on 6 March 2013 to Nadra Yuzivska, at the time a JV between Shell (50% + Op), Nadra Ukrayny (40%) and SPK Geoservice (10%). The initial work programme consisted of three exploration wells during the first year and up to US$ 10 billion invested across the lifetime of the PSA, however force majeure was declared on 15 July 2014, due to the deteriorating security situation in the region. In 2015, Shell and SPK withdrew from the JV, prompting the farm-in tender, with Yuzgas beating competing bids from Burisma Holdings and Balkash Petroleum. <P />
Yuzgas BV looks set to acquire 90% in the Yuzivska permit from state company Nadra Ukrainy's.