A concession agreement for the Kherson Commercial Seaport was signed with the Risoil-Kherson company on June 26.

The Ministry of Infrastructure announced this in a statement, the CFTS portal reports.

“We are granting concession on the first large-scale facility in Ukraine, the Kherson Commercial Seaport, today. We planned to sign the concession agreements for the Olvia and Kherson seaports on the same day, but the quarantine made its own adjustments. The concession agreement for the Olvia seaport will be signed in the near future. The next concession project, which is currently being prepared, will be the Black Sea Commercial Seaport," Ukraine’s Minister of Infrastructure Vladyslav Kryklyi said.

According to the statement, the agreement was signed in the presence of President of Ukraine Volodymyr Zelenskyi by the Ukrainian Ministry of Infrastructure’s State Secretary Volodymyr Buchko, the state-owned Ukrainian Seaports Authority’s acting head Oleksandr Holodnytskyi, the Risoil-Kherson Project Company LLC’s representative Vladyslav Talakh, and Risoil-Kherson LLC’s representative Shota Khadzhishvili.

Under the agreement, the concessionaire, Risoil-Kherson LLC, is granted the exclusive right to create, build, and manage the Kherson seaport with a view to its modernization and further development. The concession will last 30 years.

According to the statement, Risoil-Kherson will invest about UAH 300 million in development of the seaport. In addition, more than UAH 18 million will be invested in local infrastructure.

According to the signed agreement, the concessionaire is obliged to make an annual concession payment of at least UAH 12 million (taking account of indexation) and 7% of its net income, invest at least UAH 216 million in the facility during the first 3.5 years from the end of the transition period, invest at least UAH 62 million more during the first 10 years, and ensure port transshipment volumes of at least 1.36 million tons in 2030. 

In addition, the concessionaire is to contribute at least UAH 18 million to the development of local infrastructure, including through co-financing of the overhaul of the street pavement on the way to the port and construction of a new truck parking facility outside the city. The concessionaire is also required to facilitate increase of the share of the volume of cargo that is transported to the seaport by rail, inland waterways, and other modes of transport (excluding roads) to 80%; ensure uninterrupted operation of the seaport; employ all the employees of the Kherson seaport and some of the employees of the Ukrainian Seaports Authority and not initiate or allow an agency authorized by it to initiate their dismissal within 10 years from the date of their employment.

In addition, the concessionaire must not allow reduction of workers’ wages during the first three years from the date of their transfer to its employment, raise salaries in accordance with the law and industry agreement, comply with the necessary requirements of environmental legislation, and take measures to protect the environment.

As the CFTS portal reported earlier, the minister of infrastructure announced on June 15 that the text of the concession agreement for the Kherson port had been approved.