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Galnaftogaz Loan IV



Project number:


Business sector:

Natural resources

Notice type:


Environmental category:


Approval date:

10 Jun 2020



PSD disclosed:

06 May 2020

Project Description

The provision of a senior loan of up to US$ 35 milion to finance 2020-2022 capital expenditure and working capital needs of JSC "Concern Galnaftogaz" ("GNG" or the "Company"), an independent distributor of transportation fuels based in Ukraine.

Project Objectives

The Project will focus on the following objectves: (i) working capital to develop GNG's Farmer Supply Programme; (ii) improvements in GNG's logistics infrastructure; and (iii) capital expenditure for GNG's fuel stations network, including the installation of electric vehicles charging stations

Transition Impact

ETI score: 62

Competitive: As a result of the Project, the Company aims to expand its Farmer Supply Programme which will provide highly innovative pre-financing and supply of raw materials (fuels, natural gas and fertilisers) to the farmers in Ukraine by using crop receipts as a collateral. Moreover, the Company aims to introduce a number of fast electric vehicle charging stations supporting e-mobility in the cities and between the cities. 

Green: The Company is committed to continuous improvement in energy and resource efficiency of its operations. The investment programme will involve installation of electric vehicle charging stations, fuel stations and tank storages renovation. 

Client Information


GNG is Ukraine's largest company in retail distribution of transportation fuels in terms of sales volume and third largest by the number of filling stations. As of December 2019, the Company owned and operated 357 OKKO-branded filling stations.

EBRD Finance Summary

USD 35,000,000.00

Total Project Cost

USD 135,000,000.00


Financing structure: (i) the EBRD offers a tenor, which is above the market average and is necessary to structure the project; (ii) the EBRD offers a large volume instrument that fills a market funding gap and is required to structure the project.

Risk mitigation: (i) the EBRD's long-term relationship with a client provides comfort to the client to be willing to take on more risk and finance, enabling outcomes such as innovation; (ii) the EBRD provides comfort to clients and investors by mitigating non-financial risks, such as country, regulatory, project, economic cycle, or political risks.

Environmental and Social Summary

Category B (2019 ESP).  Due diligence on this Project was carried out utilising the Bank's approach to the COVID-19 situation, and involved a number of different elements.  A review of due diligence results from previous Projects; a review of the Annual Environmental and Social Reports submitted by the client for the Bank's review; a review of the potential investment plans that the Company has developed; a series of remote conferences with the client investment and EHSS Management team; and follow-up Q&A on specific issues were all used to carry out the EHSS due diligence.  The Bank has a long relationship with the client who, over time, has developed and maintained internal capacity to operate the company to the standards contained in the Bank's Performance Requirements (PRs).  Due diligence confirmed that this situation in regards of capacity and capabilities remains in place.  The proposed use of proceeds of the Bank's funding covers a number of different capital expenditures and corporate acquisition tasks and each were reviewed during due diligence and were found to be generally in compliance with the Ukrainian and the EU regulations and capable of being structured to meet the PRs.  An Environmental and Social Action Pan has been drafted and will be agreed with the client to confirm compliance with the PRs in relation to the standard of construction pertaining to tank storage safety and containment, risk assessment of facility location and design, community relations and stakeholder engagement, and contractor management.

Technical Cooperation and Grant Financing


Company Contact Information

Nazar Kupybida
+38 032 298 96 44
72 Heroiv UPA Str., Lviv, 79018, Ukraine

Implementation summary

PSD last updated

18 Jun 2020

Understanding Transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”.  The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and Compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.

OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD Enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM  via email to get guidance and more information on IPAM and how to submit a request.


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