The Ukrainian Ministry of Fuel & Energy has formally acknowledged the conversion of the Olgovskoye license in the Dnieper-Donets basin from a 5-year exploration license to a 20-year production license, said Kulczyk Oil Ventures Inc., Calgary.
Output from a production license is not restricted, whereas production from an exploration license may not exceed 10% of volumes in place.
KUB-Gas LLC, in which KOV has a 70% effective ownership interest, operates the license. Olgovskoye is the presently the most productive of the five licenses held by KUB-Gas in Lugansk Oblast of southeast Ukraine. Gross production from Olgovskoye is 12 MMcfd to KUB-Gas, or 65% of total production from the five licenses.