Gas Profiteers

The unknown gas business of Poroshenko and Medvedchuk.

According to the evidence that I’ve collected, since November 2016 the Security Service of Ukraine has been blocking liquefied gas import in the best interest of Medvedchuk and Poroshenko. Security Service employees have prevented tanks of liquefied gas from being transported over the boarder at the Energy Customs Office and it all was done under the guise of checking the documents at various customs checkpoints. And at that same time the liquefied gas was imported into Ukraine through private companies. The importer’s name was Viktor Medvedchuk and he entered into a direct collusion with Petro Poroshenko just to accomplish their little gas affair.

When Yanukovych reigned the market of liquefied gas was monopolized by Serhiy Kurchenko. Russian fuel was imported into Ukraine and sold by his structures (without any customs clearance procedures) and those structures actually monopolized the distribution of liquefied gas (hereinafter referred to as ‘LG’)

The revenue of VETEK group that was created by Kurchenko reached tens of billions of UAH. The group kept the informal status of the one being patronized by Oleksandr Yanukovych, elder son of the former president, and Artem Pshonka, son of the former Attorney General.

After Poroshenko embraced the power, other companies on LG import appeared on the market as well They were Glusco Ukraine, Creative Trading, Wexler Global LP (Great Britain), Gikka Limited, Proton Energy Group S. A. and those companies were connected to Viktor Medvedchuk.

These companies are also indirectly tied to Roshen Corporation. For instance, Viala Trade Limited (Belize) and Gateno Ventures Inc (Panama) are among the founders of the British company Wexler Global LP. These same firms are found among the founders of the British company Foreway Sales LLP that, according to customs data, was used by Roshen Corporation for selling its products to Turkmenistan in 2015.

Exactly in the end of 2016 and the beginning of 2017 Medvedchuk’s gas traders took the lead in LG import to Ukraine. It all became possible owing to the work of the Security Service of Ukraine under the thorough control of Petro Poroshenko since Medvedchuk’s rivals became subject to criminal proceedings initiated by security servicemen. And the customs registrations of cargo (that is liquefied gas) were blocked by the Security Service within the framework of those investigations.

Detention of imported tanks with liquefied gas was reasoned by the following arguments:

- Suspicion of being involved in financing terrorism :-)

- Incorrect data on the quantity, weight, range, features and price of the products;

- Poisonous components in the composition of the products that might cause harmful health risks.

Let me give you some facts in order to better demonstrate the essence of that so called ‘special operation’.

On November 11, 2016 Directorate General for Combating Corruption and Organized Crime of the Security Services of Ukraine (hereinafter referred to as SSU) forwarded a letter to Ihor Pikovskyi, Head of the Energy Customs Office of the State Fiscal Service of Ukraine, regarding the activities to be undertaken jointly. Mr. Pikovskyi was assigned as Customs Office Head under the patronage of Ihor Kononenko.

On November 11, 2016 Directorate General for Combating Corruption and Organized Crime of the Security Services of Ukraine (hereinafter referred to as SSU) forwarded a letter to Ihor Pikovskyi, Head of the Energy Customs Office of the State Fiscal Service of Ukraine, regarding the activities to be undertaken jointly. Mr. Pikovskyi was assigned as Customs Office Head under the patronage of Ihor Kononenko.

It was said in the letter that LLC Import Trans Service was receiving products breaking customs legislation and the documents contained faked data regarding the quantity, weight, range, features and price of the products.

The Security Service of Ukraine considered such a situation to be a loophole for corruption conspiracy between customs officers and company’s representatives. So, all the products that were imported through the customs house for LLC Import Trans Service were subject to customs inspection that included sampling and authenticity check of documents due to possible poisonous components in the content of the products.

LLC Import Trans Service deals with liquefied gas wholesale and is part of Continium Group (WOG gas stations) that was founded by deceased deputy Ihor Yeremeyev. The group is under control of Stepan Ivakhiv and Serhiy Lahur.

However, besides Continium Group, there was a whole range of other traders that stood in the way of Medvedchuk and Poroshenko. So SSU initiated a pre-trial investigation No.22016220000000238 as of November 16, 2016 on financingof terrorism. Enterprises of Kurchenko and Akhmetov were also under arrest within the framework of that investigation.

As part of the investigation, on November 30, 2016 SSU obliged the Energy Customs Office to notify SSU about the declarations of the following enterprises: LLC Naftoprodukt Trading, Private Company ‘NP Trading’, LLC Ukrpetrolpostach, LLC Ukrgaspetroleum and LLC SVG PLUS. Cargo clearance should be also agreed with the Security Service of Ukraine.

LLC Ukrgaspetroleum and PC NP Trading were considered as linked to runaway oligarch Serhiy Kurchenko. Pikovskyi forwarded the corresponding letter to all heads of customs checkpoints.

Tanks with gas supplied by LLC Ukrpetrolpostach were added to the list by SSU in December 2016. In that case detention of tanks was reasoned by the possibility of them containing poisonous components in the composition of the products (letters dd. December 1, December 2, No. 24967, No. 24964, and December 9, 2016).

Starting from December 22, 2016 SSU found one more company that was engaged in customs clearance of liquefied gas of Russian origin and its name was SVG PLUS (Poltava Enerhetychnyi customs checkpoint – 5 tanks for 186 tons, Kypyansk Enerhetychnyi customs checkpoint – 6 tanks for 244 tons – in the interests of SVG PLUS, 3 tanks – in the interests of UPK-Yevroplyus). It was said in the letter that the Security Service of Ukraine forbade customs registration of that cargo since the product could contain poisonous substances (letters dd. December 22, 2016, January 19, 2016, February 14, 2017, January 26, 2017 and February 22, 2017).

On January 19, 2017, within the framework of that same pre-trial investigation No. 22016220000000238, SSU sent two letters (No. 827 and No. 828) asking to detain tanks containing liquefied gas that were intended for LLC Yevrostandart Avtogaz. Responsibility for financial settlement of the issues at the customs house was born by Parallel-M Ltd, the company was considered to be linked to Mr. Akhmetov and was earlier suspected of financial terrorism.

Within the framework of those detentions the Security Service of Ukraine got numerous POA (power of attorney) orders allowing joint examination of cargo (POAs dd. December 16, 2016; December 21, 2016; December 26, 2016; December 30, 2016 No. 26933, No.26954; January 12, 2016 No.478 for Propan Pride; No. 480 for Ukrpetrolpostach). The instructions were instantly delivered to customs checkpoints by the head of the Energy Customs Office. Inspection of goods was possible only in the presence of SSU representatives.

By the way, Kurchenko used the same scheme in 2013 to restrict petroleum products import.

Within the first days (December 2, 2016) of ‘customs clearance prohibition’ the Security Service of Ukraine was notified by the representatives from the Energy Customs Office that similar inspections had been conducted in the presence of the SSU representatives earlier. The identification inspection was done and samples of liquefied gas were selected from tanks.

According to the results of the examinations conducted by the specialized laboratory of the State Fiscal Service, the main properties of gas and its chemical composition was confirmed. In accordance with the customs legislation, products were allowed to be released from the customs checkpoint before receiving results of the examination under the condition that all customs duties would be paid after the results were obtained, unless there were other legal prohibitions.

Based on that, the Energy Customs Office asked the Security Service of Ukraine to expedite sampling of gas in order to avoid a groundless delay.

However, as it was known, the number of gas traders who suffered SSU sanctions was increasing and hundreds of tanks were subject to gas sampling. When one part of tanks was still under examination they kept on receiving new POF orders for the other part of tanks to be checked.

The Energy Customs Office was in constant contact with the Security Service of Ukraine (there are letters dd. December 5, 2016, December 9, 2016 and December 23, 2016). It politely asked the Security Service to provide expertise for the liquefied gas sampling within the shortest timeframe. Further, the customs office had to report that there were no grounds for further detention of some traders’ products.

In January 2017 after a number of traders started to write complaints about actions of the fiscal body and the security forces, the Energy Customs Office notified the Security Service of Ukraine that all of the legal measures on checking customs registration of cargo and product sampling had been taken.

According to the information that was provided by the Specialized Examination Laboratory of the State Fiscal Service it was not possible to find hazardous substances in the composition of liquefied gas due to absence of methods applicable for such examination to be conducted.

Business entities complained about the actions of the Energy Customs Office to the Cabinet of Ministers of Ukraine, anti-monopoly bodies and other structures.

It was also said in the correspondence that, according to the legislation, customs registration should be completed within maximum 4 days. Cost of the examinations was said to be covered by the customs office since no violations had been detected. At the end of January 2017 only the price of samplers reached 7mln UAH.

But you don’t have to think that the customs office was outside the scheme. Most probably, the correspondence was just a means to take off responsibility for complicity with the Security Service that would be disclosed in the future.

For instance, customs officers asked the Security Service of Ukraine to do an additional examination of the products for poisonous substances; they also required a delegation of SSU experts at the customs office that were supposed to conduct inspections in the future (letters dd. January 20, 2017). It all was done to just take the responsibility of the customs office.

In the beginning of February, 2017, the Energy Customs Office notified the Security Service of Ukraine about the state of affairs at the customs office. The chronology of their communication could be also described by the outcomes of their actions. It all led to numerous complaints about the groundless delays customs registrations that in the end brought in million-hrivnas-statements of claim and a reaction of the attorney (ordered by Ukrgaspetroleum) requiring a legal estimation of such actions. The attorney also attached a gas samples test report to his claim and it turned out that all samples met GOST standard requirements.

On February 19, 2017 the Security Service of Ukraine allowed the Energy Customs Office to release 14 tanks that had been detained earlier (here are letters containing detention orders dd. December 21, 2016, December 23, 2016 and December 26, 2016) and to finish customs registrations disregarding the previous prohibitions. That is, being pressed by media, lawyers and attorneys, the Security Service of Ukraine stopped caring about poisonous substances in the composition of the products.

A similar letter was sent by the Security Service of Ukraine on March 6, 2017. It referred to LLC Parallel M Ltd. The customs office was allowed to release 33 tanks of gas without any sampling procedures for detecting poisonous substances in its composition.

The Ministry of Economic Development also lifted sanctions against 15 importers of liquefied gas.

Despite the fact that the sanctions expired by March 2017, their active period was quite enough for Medvedchuk and Poroshenko to accomplish their plan. Medvedchuk’s company Proton Energy Group S. A. (Switzerland) became an exclusive supplier of Russian gas from PJSC Rosneft Oil Company and the firm used the most out of such an exclusive position.

Only in February 2017 Glusco Ukraine and Creative Trading, companies controlled by Medvedchuk, were positioned as leading importers of liquefied gas into Ukraine: 15.9 thousands of tons of Russian gas. Even though, Glusco Ukraine and Creative Trading were little-known in the first quarter of 2016. But in the first quarter in 2017 their share on the Ukrainian market of liquefied gas reached 14%.

In such a way the collaboration of Poroshenko and Putin’s friend Medvedchuk made perfect conditions to initiate a forcible entering into the Ukrainian gas business with the help of gas supplies from the Russian Federation.

This is how exactly a long lasting farewell to Russia looks like in reality. Well done guys.

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Александр Дубинский

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