PHОТО: PHL

The Coal Ministry plans to complete the privatization of investment-attractive coal mines in Ukraine by the end of 2014. Ministry officials said the privatization of economically efficient state-owned coal mines and the shutdown of unpromising mines are the only key to reform of this sector. The report said the ministry will provide substantiation of the basic provisions of reform and the forecast for future development of the sector by the end of 2010 .

According to the timetable drafted by the ministry, by the middle of 2012 the corresponding enterprises in the coal industry should be registered on the books of the State Property Fund for their corporatization. One of the important stages of liberalization of the coal market is the liquidation of the state enterprise Vuhillya Ukrainy, a monopoly on the wholesale coal market.

“Within the framework of the general concept of economic reform, the liquidation of state enterprises in the coal sector is should be completed by the end of 2012 after the actual completion of privatization of coal extracting enterprises or thermal power plants, which are the main consumers of power-generating coal,” stated the report.

In addition, the ministry feels that gradual transition to the principles of trading of coal products on stock exchanges and their supply on terms of direct contracts are requirements for pulling out of a state monopoly. The ministry expects that by the end of 2016 the volumes of government funding of operational expenses in the coal mining sector will be cut by at least 80%. The list includes 103 mines, two coal industry administrations, one open-pit mine and one state enterprise subordinated to the lignite extraction production association.