(KYIV, UKRAINE) – A state auction for a 20 year oil and gas development licence in western Ukraine has failed after no bidders registered for the permit, which carried a starting price of 1.1 billion hryvnias. The result leaves a significant exploration block covering parts of the Lviv and Ivano Frankivsk regions without a developer.
The electronic auction, scheduled for 29 July, was the fourth sale held by the State Service of Geology and Subsoil of Ukraine since the start of 2026. It was listed on the Prozorro.Sales plfatorm, the country’s official procurement and asset sales system. According to the published auction protocol, no participant had registered by the evening of 28 July.
The permit on offer covered the Lysovytska area, which spans the Stryi district of Lviv region and the Kalush district of Ivano Frankivsk region. It would have allowed geological study of oil and gas bearing subsoil, including pilot commercial development of deposits, followed by full extraction of oil and gas over a two decade term. The starting lot price was set at 1.1 billion hryvnias, excluding value added tax.
At current exchange rates, the 1.1 billion hryvnia starting price is equivalent to approximately 29.9 million US dollars, 23.4 million British pounds, or 27.3 million euros. The absence of registered bidders means the state will need to decide whether to relaunch the sale, revise the terms, or seek direct negotiations with potential investors.
The failed auction comes against a backdrop of broader efforts by Ukraine to attract investment into its mineral and hydrocarbon resources. In May 2026, the same state geology service conducted electronic auctions for eight special subsoil use permits through Prozorro.Sales. Those sales involved licence areas containing mineral groundwater, drinking groundwater, amber, sand, clay and loam. The total realised value reached almost 15 million hryvnias, compared with a combined starting price of 12.7 million hryvnias for those lots. That equates to roughly 408,000 dollars, 319,000 pounds, or 372,000 euros in realised value.
The government has also recently approved a 20 year strategy for industrial development based on mineral resources, signalling its intent to make greater use of domestic raw materials. However, the failure to attract interest in the Lysovytska oil and gas block points to ongoing challenges in convincing commercial operators to commit large sums to domestic hydrocarbon exploration and production, even as Ukraine seeks to strengthen its energy independence.