The European Bank for Reconstruction and Development (EBRD) has signed a loan agreement with Ukraine for $300 million (€272 million) to facilitate the purchase of gas for the winter. 

The loan, which was signed in Berlin today, has been given on the condition that changes will be made at Ukraine’s national gas company, Naftogaz. This includes; the creation of a board of supervisors that include independent and qualified directors, the introduction of internal audit, compliance, anti-corruption and risk management functions and an ownership and governance structure in line with best international practice.

Naftogaz will use the money to purchase 1.1 billion cubic metres of gas for storage, ahead of the bitterly cold winter months.

Phil Bennett of EBRD stated, “By providing this loan to Naftogaz, we are not only helping to strengthen energy security in Ukraine, but we also foster the reform agenda in the energy sector making it more open, transparent and efficient.”

Ukraine’s Finance Minister, Natalie Jaresko stated of the EBRD Loan, “We are thankful to the EBRD for this loan agreement, a true milestone of our shared commitment to Ukraine’s energy sector reform. With the EBRD’s support, we have taken a significant step forward in ensuring financing for continuous gas supplies for the winter.”

The EBRD loan has a three year ‘revolving door’ facility that will allow Ukraine to pay it back and borrow the money again in three years, should it be required.