The State Service of Geology and Subsoil without auctions handed lithium deposits to the circles around Kononenko and Avakov, classified by the SBU

The State Service of Geology and Subsoil without auctions handed lithium deposits to the circles around Kononenko and Avakov, classified by the SBU

All three lithium deposits previously explored in Ukraine in 2017-2018 years were transferred without auctions to private companies.

This is reported in an investigation by Nadiya Burdey for the program “Our Money with Denys Bihus.”

Lithium is a metal used as the basis for batteries in mobile phones, computers, and electric vehicles. Its market value is about $20 thousand/ton.

In Ukraine, three deposits have been preliminarily explored: Shevchenkivske (Donetsk region), Stankuvatke and Polokhivske (Kirovohrad region).

So far lithium is not being mined, and its reserves are classified by the Security Service of Ukraine. This was done back in 2005 at the request of a state official on secrets. The ban on publishing the balance reserves of the deposits and the precise locations of the deposits is in force until 2020. In addition to lithium, the state secret extends to a number of other metals and precious stones.

In 2017 the permit to extract lithium at the Polokhivske deposit was granted by the State Service of Geology and Subsoil to the company LLC Ukrlitiyvydobuvannya, and at the beginning of 2018 the Shevchenkivske deposit was granted to the firm Petro-Consulting. Both firms used an “approval” scheme. The Kirovohrad Regional Council approved a special permit for lithium extraction on the Dobra section of the Stankuvatke deposit.

Although the data are formally classified, the firm Petro-Consulting itself announced them, estimating the reserves of the Shevchenkivske deposit at 14 million tons. The firm said it is already negotiating to involve a foreign investor in the project to begin lithium extraction from 2021.

Ukrlitiyvydobuvannya previously belonged to the circle of MP from the Party of Regions Yuriy Ivanyushchenko and to the son of former Prime Minister Mykola Azarov – Oleksiy. Through a scheme of alienation the firm became the owner of 120 hectares of land at the Polokhivske lithium deposit. After the change of power it obtained new owners. Among them is Ihor Voronov – a business partner in energy projects of MP Vadym Novynskyi (Opposition Bloc). In 2017 the State Service of Geology and Subsoil issued it a license to extract lithium at the Polokhivske deposit. But the company planning to actually mine the ore here is LLC Ukrainian Rare Metals, which is trying to obtain a special permit through the courts. The firm is connected to the circle of MP Ihor Kotvitskyi (People’s Front) – a business partner of the family of Interior Minister Arsen Avakov.

The official register of the State Service of Geology and Subsoil contains no information about Ukrainian Rare Metals receiving a special permit.

The director of Petro-Consulting is Taras Ihnashenko – the son of Volodymyr Ihnatenko, an adviser to Minister of Energy and Coal Industry Ihor Nasalyk.

Ihnatenko senior is a neighbor of the first deputy head of the parliamentary faction of the Bloc of Petro Poroshenko, Ihor Kononenko – a business partner of Petro Poroshenko. In 2016 journalists recorded Ihnashenko among those who met Kononenko at Zhulyany Airport.

Volodymyr Ihnashenko is also an aide to People’s Deputy from the Bloc of Petro Poroshenko Anatoliy Matviienko, who is the uncle of People’s Deputy from the Bloc of Petro Poroshenko and former head of the State Administration of Affairs, Serhiy Berezenko. The latter is now one of the most influential people in the BPP faction.