Ukrainian firms have signed a plethora of deals to rebuild the country’s war-torn energy sector, including several with export credit agencies (ECAs) and the European Bank for Reconstruction and Development (EBRD).
The deals include financing for a 60MW wind farm in Lviv and a pledge from the Export-Import Bank of the United States (US Exim) to source equipment from US suppliers to repair the country’s gas infrastructure.
For the wind farm, German state-owned development institution KfW Ipex-Bank is set to provide a €42.3mn loan to Ukrainian renewable energy firm Atlas Global Energy to finance the import of nine wind turbines from German manufacturer Nordex.
The financing is guaranteed by Turkish conglomerate Eksim Group, whose holdings include renewable energy producer Eksim Energy, and backed by cover from the German ECA Euler Hermes Aktiengesellschaft.
Velibor Marjanovic, member of the management board of KfW Ipex-Bank, said: “We are proud to have provided funding for this important project despite difficult conditions.
“This is largely thanks to the cooperation with our esteemed partners Atlas Global and the Eksim Group. With our joint commitment, we are making a contribution to the reconstruction of Ukraine’s energy infrastructure.”
Separately, US Exim has agreed to establish a financing mechanism of up to US$300mn with Ukraine’s Naftogaz, a state-owned oil and gas company.
Signed at the Ukraine Recovery Conference in Gdańsk last week, the agreement would enable Naftogaz Group companies to procure equipment from US suppliers.
“This will help bring damaged facilities back into operation faster, strengthen infrastructure and introduce modern technologies into Ukraine’s energy sector,” Naftogaz said.
The agreement was one of 12 signed with partners from the US, Europe and Japan covering “financing, modern equipment, technologies and engineering expertise for Ukraine’s energy sector”, said Sergii Koretskyi, chief executive of Naftogaz.
“Our task is to bring damaged facilities back into operation faster, develop new capacity, and strengthen the country’s energy resilience. The next step is implementation of the agreements reached.”
Other agreements announced during the conference included a €50mn loan from the EBRD for the development and construction of a 189MW wind power plant by Galnaftogaz, which operates a chain of filling stations across the country and has diversified into renewable energy.
The financing will be provided via a consortium with the Black Sea Trade and Development Bank, British International Investment, the International Finance Corporation and Swedfund, Sweden’s development finance institution. It will have a first-loss guarantee from the EU’s Ukraine Investment Framework.
The latest agreement builds on the EBRD’s wider support for Ukraine. Since the start of Russia’s invasion in 2022, the bank said it has invested almost €10bn in Ukraine’s economy and is set to “step up investments once reconstruction begins”.
At the EBRD’s annual meeting in Riga earlier this year, the bank reaffirmed its commitment to supporting Ukraine, and has cited strengthening the country’s energy systems as one of its priorities.
Last year, the EBRD struck risk participation deals for its trade finance exposure in Ukraine with development finance institutions in the UK and France.
