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Subsoil users do not support the reorganisation of the State Service of Geology and Subsoil Resources

06/ 04/ 2026
  Member companies of the European Business Association are concerned about potential plans to reorganise the State Service of Geology and Subsoil Resources of Ukraine. According to business information, the Ministry of Economy, Environment and Agriculture is considering a decision to establish a State Agency for Natural Resources Management, transferring to it the powers of the current service. The business community does not support this initiative, as it may negatively affect sector stability, the investment climate, and budget revenues. Risks for the sector: Disruption of permitting procedures. During the establishment of a new authority, the issuance, renewal, and amendment of special subsoil use permits may be suspended, effectively paralysing company operations. Complications in international cooperation. The State Service plays a key role in implementing international investment agreements, in particular within the framework of the U.S.–Ukraine Reconstruction Investment Fund. Changes to the institutional model may jeopardise Ukraine’s ability to meet its commitments. Uncertainty for investors. Reorganisation may halt the implementation of production sharing agreements — one of the most predictable mechanisms for attracting international investment into the extractive sector. Disruption of related geological services. Approval of mineral reserves, access to geological information, and the conduct of expert assessments and research may be put at risk. The reorganisation would also paralyse the activities of geological enterprises, institutions, and organisations under the Service’s management that provide essential services to subsoil users. Prolonged transition period. Reorganising the Service, transferring functions, assets, and budget obligations, as well as reshaping interaction between state authorities, may take from six months to three years. Risk of losing human capital. The reorganisation may lead to the outflow of experienced specialists in the geological sector. Slowing the development of Ukraine’s mineral resource base, including the generation of geological data and the maintenance of the state register of deposits. In addition, the activities of the State Service have significant economic importance. Based on auction results alone, in 2025 the state budget received approximately UAH 1.8 billion, demonstrating sustained investor interest in Ukraine’s subsoil resources. In previous years, the Service also ensured consistent budget revenues, issued hundreds of special permits, and improved market transparency by clearing out ineffective licences. Therefore, in the view of the business community, even a temporary suspension of the authority’s operations could result in lost budget revenues, delays in investment projects, and a decline in confidence among international partners. The Association emphasises that amid the war and ongoing attacks on infrastructure, the sector requires stability in public administration. Structural decisions taken without broad consultation with the market and stakeholders may have unpredictable consequences. In this regard, the European Business Association calls on the Government not to initiate the reorganisation of the State Service of Geology and Subsoil Resources of Ukraine and instead to focus on strengthening the capacity of the existing authority.

Member companies of the European Business Association are concerned about potential plans to reorganise the State Service of Geology and Subsoil Resources of Ukraine. According to business information, the Ministry of Economy, Environment and Agriculture is considering a decision to establish a State Agency for Natural Resources Management, transferring to it the powers of the current service.

The business community does not support this initiative, as it may negatively affect sector stability, the investment climate, and budget revenues.

Risks for the sector:

  • Disruption of permitting procedures. During the establishment of a new authority, the issuance, renewal, and amendment of special subsoil use permits may be suspended, effectively paralysing company operations.
  • Complications in international cooperation. The State Service plays a key role in implementing international investment agreements, in particular within the framework of the U.S.–Ukraine Reconstruction Investment Fund. Changes to the institutional model may jeopardise Ukraine’s ability to meet its commitments.
  • Uncertainty for investors. Reorganisation may halt the implementation of production sharing agreements — one of the most predictable mechanisms for attracting international investment into the extractive sector.
  • Disruption of related geological services. Approval of mineral reserves, access to geological information, and the conduct of expert assessments and research may be put at risk. The reorganisation would also paralyse the activities of geological enterprises, institutions, and organisations under the Service’s management that provide essential services to subsoil users.
  • Prolonged transition period. Reorganising the Service, transferring functions, assets, and budget obligations, as well as reshaping interaction between state authorities, may take from six months to three years.
  • Risk of losing human capital. The reorganisation may lead to the outflow of experienced specialists in the geological sector.
  • Slowing the development of Ukraine’s mineral resource base, including the generation of geological data and the maintenance of the state register of deposits.

In addition, the activities of the State Service have significant economic importance. Based on auction results alone, in 2025 the state budget received approximately UAH 1.8 billion, demonstrating sustained investor interest in Ukraine’s subsoil resources. In previous years, the Service also ensured consistent budget revenues, issued hundreds of special permits, and improved market transparency by clearing out ineffective licences.

Therefore, in the view of the business community, even a temporary suspension of the authority’s operations could result in lost budget revenues, delays in investment projects, and a decline in confidence among international partners.

The Association emphasises that amid the war and ongoing attacks on infrastructure, the sector requires stability in public administration. Structural decisions taken without broad consultation with the market and stakeholders may have unpredictable consequences.

In this regard, the European Business Association calls on the Government not to initiate the reorganisation of the State Service of Geology and Subsoil Resources of Ukraine and instead to focus on strengthening the capacity of the existing authority.

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