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World Bank endorses $500 mln loan for Naftogaz to buy gas

World Bank endorses $500 mln loan for Naftogaz to buy gasThe World Bank Board of Governors has endorsed guarantees worth $500 million under which Naftogaz Ukrainy may be provided with credit facilities or loans from international commercial banks to buy natural gas from individual suppliers, Ukrainian Finance Minister Oleksandr Danyliuk has said.

"I welcome the World Bank Board's decision to grant $500 million in loan guarantees to Naftogaz to buy gas. This would enable us to safely pass the heating season," Danyliuk wrote on his Facebook page.

The Finance Ministry clarified the funds will be provided at the conditions attractive for Naftogaz: the availability of the World Bank guarantee reduces risks for borrowers and allows lenders to provide funds at a lower interest rate.

"Naftogaz is expected to sign a loan agreement after all the necessary procedures are completed," the ministry said.

As reported, President of the European Investment Bank Werner Hoyer and President of the World Bank Jim Yong Kim on October 9, 2015 signed an agreement under the guarantees of the European Union to attract credits of up to $520 million for gas purchases by Naftogaz Ukrainy both from Europe and Russia. However, the consideration of the project has been delayed for a long time.
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