The Ukrainian-American Investment Fund, established under the mineral resources agreement with the USA, may face prolonged difficulties at the start of its operations. The main issue lies in the complexity and duration of preparing all the necessary documentation for the development of deposits: this process may take no less than five years.
This is reported by Business • Media
Geological Exploration and Documentation Preparation
Investors will need to invest significant resources in conducting additional geological exploration work. This is necessary because much of the information gathered during the Soviet era is either lost or exists only in paper format, which does not meet modern requirements. According to Alexander Shumskiy, head of one of the departments of the State Tax Service, “further drilling” of the deposits and obtaining new samples are required for a comprehensive assessment of the reserves.
“Any deposit will need to be further drilled to obtain a sufficient number of samples and subsequently assess the level of reserves according to international standards,” added Shumskiy.
Requirements for Investors and Government Authorities
Potential investors will also need to prepare a detailed “bankable feasibility study.” This document must contain reliable information about geological reserves, technical extraction capabilities, economic viability, and the environmental impact of the project. It is based on this study that Western investors will assess the feasibility of financing.
For their part, Ukrainian authorities must provide mineral users with all the necessary conditions for preparing the documentation. The estimated duration of the preparatory phase is at least five years. Only after this can companies move on to seeking financial partners for further project development, construction of quarries, or processing plants.