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. Last Updated: 07/27/2016

Ukraine Orders Vanco Black Sea Deal Revived

KIEV — Ukraine's Security and Defense Council on Friday ordered the government to rescind a decision to break off an energy exploration and extraction contract in the Black Sea with U.S. firm Vanco Energy.

The decision of the council, headed by President Viktor Yushchenko, is binding under Ukraine's constitution.

"The government is obliged to rescind its decision to break off the agreement in unilateral fashion," Ukrainian Council Secretary Raisa Bogatyryova told journalists.

"It has been shown that the company took part in the tender in a completely legal manner, won it in accordance with the conditions proposed by the government in 2005, signed documents with the government and is prepared to fulfill its obligations."

Prime Minister Yulia Tymoshenko, the president's ally from the time of his election in 2004 but now at odds with him over a wide range of issues, made no immediate comment.

The government annulled Vanco's 30-year license this month and said it had withdrawn from the agreement in order to protect state interests — despite a ruling by Ukraine's prosecutor general suspending the annulment.

The United States criticized the government's move, saying Ukraine needed to "respect the sanctity of contracts and the rule of law" in order to attract investors.

Tymoshenko had said Vanco broke a number of rules and conditions of the agreement and voiced her concern that the firm was willing to sell the license to large energy multinationals, such as Gazprom.