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Supreme Court rejects Ukrnaftoburinnya appeal against special permit for Sakhalinske Field

The Supreme Court has rejected the appeal of the Ukrnaftoburinnya private joint-stock company against the decision of the Sixth Administrative Court of Appeal, which on November 28 canceled a special permit for subsoil use at the Sakhalinske oil and gas condensate field in the Kharkiv Region.

This is stated in the company's message, Ukrainian News Agency reports.

"The ruling of the Supreme Court is motivated by the fact that, since the decision of the court of first instance is not in the list of rulings that can be appealed in cassation order, defined in part two of Article 328 of the Code of Administrative Procedure (CAP) of Ukraine, there are also no grounds for opening cassation proceedings for the decision of the court of appeal based on the results of revising the decision of the court of first instance. Thus, the Supreme Court denied PrJSC MC Ukrnaftoburinnya access to justice," the statement said.

The company considers unreasonable the motives of the Supreme Court, since Article 328 of the CAP of Ukraine does not contain restrictions on appealing the decision of the court of appeal on the consequences of reviewing the decision of the court of first instance on the issues of turning the execution of the court decision.

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"Moreover, the practice of the Supreme Court testifies to the possibility of a cassation review of the court of appeal order on such issues. Ukrnafta, which the Cabinet of Ministers obliged to preserve the functioning of Ukrnaftoburinnya’s assets, will take all legally possible measures that will preserve the economic activities of Ukrnaftoburinnya," the statement said.

According to ExPro, in 2022, compared to 2021, the company reduced natural gas production by 6% to 0.65 billion cubic meters, which amounted to 3.5% of total natural gas production in Ukraine (in 2022, natural gas production in Ukraine decreased by 6% to 18.5 billion cubic meters).

As Ukrainian News Agency earlier reported, Ukrnaftoburinnya on December 1, due to the cancellation by the court of a special permit for the use of subsoil, stopped the production of natural gas and gas condensate at the Sakhalinske oil and gas condensate field.

In May, the Cabinet of Ministers transferred corporate rights of Ukrnaftoburinnya to the management of Ukrnafta, the largest oil producing company.

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In April, the Pecherskyi District Court of Kyiv transferred corporate rights of Ukrnaftoburinnya, which were seized within the framework of criminal proceedings, to ARMA

Ukrnaftoburinnya is conducting commercial development of the Sakhalinske gas and gas condensate field.

In 2021, compared to 2020, the company reduced natural gas production by 5%, or 34.1 million cubic meters, to 691.3 million cubic meters.

Earlier, Ukrnaftoburinnya was affiliated with businessmen Vitalii Khomutynnyk and Ihor Kolomoiskyi.

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