According to Requirement 6.1 of the EITI Standard, extractive companies are to disclose their material mandatory social and environmental expenditures. Where material mandatory payments are contractually mandated, disclosure of the relevant contracts is also expected.

In 2023 - 2024, the main social and environmental payments of extractive companies, the payment of which is mandatory according to the Ukrainian law, were the environmental tax and the Unified Social Contribution.

Extractive enterprises paid the Pension Fund of Ukraine reimbursement for the costs of payment and delivery of preferential pensions in accordance with the Law of Ukraine "On Compulsory State Pension Insurance".

In the funds from the companies do not fully cover the expenditures related with paying and delivering such pensions, the lacking funds are financed from the general fund of the State Budget of Ukraine. The specified payments are not tax payments.

According to the PFU as of January 1, 2025 the total of 106,349 persons were to receive preferential pensions from the material reporting companies, including 27,774 women.

The current EITI Law does not provide for the disclosure of such information, therefore, the information was not requested from the material reporting companies. The debt to the Pension Fund as of 01.01.2024 is UAH 905.89 million.

In 2023–2024, coal mining companies provided free coal to employees and privileged categories of citizens for household needs, which may be considered as a mandatory social payment in kind. According to Article 43 of the Mining Law, the following categories of persons are entitled to receive such coal:

The current law does not provide for a direct obligation for business entities to disclose such information. According to the information received by the Independent Administrator from the Ministry of Energy of Ukraine regarding the provision of household fuel to the employees of the state-owned mines, 7,904 coal recipients received coal free of charge in 2024. The volume of coal provided free of charge to the employees of coal mining enterprises is not a material payment in 2024.

Given that the Ministry of Energy collects information only from the state-owned mines, the Independent Administrator sent requests to other material reporting companies in order to obtain data on the provision of free coal to the coal recipients. The only company that provided information is DTEK Pavlohradcoal PrJSC. The price of one ton of coal (excluding VAT) was UAH 6,250 in the reporting period. The total volume of free coal provided was 60,393.20 tons, which was distributed among 12,575 coal recipients. The estimated cost of the volume is UAH 377,457.50 thousand (excluding VAT).

Also, as part of the report on payments in favour of the state, Colliery Group Pokrovs'ke PrJSC disclosed information on the provision of household coal to the worth of UAH 40,531.70 thousand.

In the reporting period, the reporting coal mining companies also provided preferential categories of the population with free coal in accordance with current legislation.

The total need of preferential categories of the population for household fuel in 2024 was 6,812.9 tons of coal for 1,238 people. However, during the year, only 1,054 people were provided with fuel, i.e. 85.1% of the need. Also, the distribution of fuel between preferential categories did not reach the planned amount - it reached 5,646.4 tons of coal, which is 82.9% of the need. Based on the information on providing preferential categories of beneficiaries with coal for household fuel for 2024.

Since the beginning of the year, 52,347.8 tons of coal for 10,824 people* were exported by coal-mining enterprises to provide workers and privileged categories with free fuel.
The total need of privileged categories of the population to provide household fuel in 2023 was 6,013.5 tons of coal for 1,102 persons*.
*Information provided to the Ministry of Energy at the request of the Independent Administrator, and includes only information about state-owned enterprises that are subordinate to the Ministry of Energy.

PSAs may provide for the investor’s obligation to make social or environmental payments.

The extracts and essential terms of a number of PSAs, which are posted on the Ministry of Energy’s website, provide for the possibility of making infrastructure and social payments in favour of the state or local communities. The essential terms of the PSAs specify general provisions on financing social investments and infrastructure modernization. Obligations to make environmental payments do not directly follow from the publicly available essential terms of the PSA.

As part of the Report on payments in favour of the state, 5 material reporting companies disclosed information on the existing contractual obligations for social and environmental payments in the amount of UAH 1,515.41 million. The payments were below the materiality threshold approved by the EITI MSG for 2024.

In 2024, the law did not provide for mandatory contributions by extractive companies to infrastructure development or social payments as conditions for obtaining special permits for subsoil use.

At the same time, a number of material reporting companies made social, environmental or infrastructure payments in 2024 in accordance with agreements concluded to fulfil the conditions for issuing special permits issued before 2015.

Until 2015, the granting of special permits for subsoil use required approval from the relevant regional councils, and decisions on approval of the issuance of special permits could contain obligations to fulfil certain social and infrastructure obligations.

Natural Resources PrJSC and Eastern Geological Union LLC received approval to obtain a special permit from the Poltava Regional Council in 2011 and 2014. As part of the agreements, the regional council obliged both companies to conclude annually, during the term of the special permit, agreements with local authorities for the construction, reconstruction, repair, and maintenance on a shared basis of social infrastructure facilities, local roads, and environmental protection measures.

In 2023, the legislation did not require extractive companies to make mandatory infrastructure development contributions as a condition for obtaining special permits for subsoil use.

The EITI Report 2024 presents data on 59 material reporting companies that submitted the relevant information via the EITI online platform. The current reporting form requires the companies to provide the total expenses without disaggregation by social and environmental areas. Therefore, the Independent Administrator determined the following key categories of the payments:

The first 6 categories are subtypes of social expenditures, and the category of environmental payment is a separate one. In addition, due to the russian full-scale invasion of the territory of Ukraine in 2022, a significant amount of voluntary expenditures of extractive companies were directed to the needs of military formations and to assist citizens affected by the hostilities. For this reason, the Independent Administrator has identified a separate category of expenses “Assistance to Defenders and Strengthening Ukraine’s Defence Capability”. This additional category in 2024 includes purchases of vehicles and fuel, personal protective equipment, tactical equipment and other purchases to satisfy the needs of the defenders of Ukraine. Also, part of the expenses of the material reporting companies were directed to support internally displaced persons, military families and humanitarian aid. These expense items are combined into the “Charity” category.

Overall, 19 material reporting submitted information on their social expenditures, including 12 companies that belong to oil and gas industry, 6 companies – to metal ore industry, and 1 company to the coal industry.

The largest category of expenditures is Assistance to Defenders – 81.97% of the total funds voluntarily spent by material companies were for the needs of the Armed Forces of Ukraine in 2024. The total amount of the reported payments is UAH 841,108.08.

The EITI Report 2024 presents data on 59 material reporting companies that submitted the relevant information via the EITI online platform. The current reporting form requires the companies to provide the total expenses without disaggregation by social and environmental areas. Therefore, the Independent Administrator determined the following key categories of the payments:

The EITI Report 2023 presents data on 59 material reporting companies that submitted the relevant information via the EITI online platform. The current reporting form requires the companies to provide the total expenses without disaggregation by social and environmental areas. Therefore, the Independent Administrator determined the following key categories of the payments:

The first 6 categories are considered subtypes of social expenses, and the last category is deemed to be environmental payments. In addition, due to the full-scale russian invasion of the territory of Ukraine in 2022, extractive companies spent a significant amount of their voluntary expenses to satisfy the needs of Ukrainian military formations and to assist Ukrainians who suffered as a result of hostilities. For this reason, the Independent Administrator has identified a separate category of expenses “Assistance to Defenders and Strengthening the Defense Capability of Ukraine”. In 2023, this additional category includes purchases of vehicles and fuel, personal protective equipment, tactical equipment and other purchases aimed at the needs of defenders. Also, part of the expenses of the reporting extractive companies were directed to support internally displaced persons, military families and humanitarian aid. All these expenses are combined into the category “Charity”.

23 material reporting companies submitted information on social expenditures, including 6 iron ore mining companies, 1 coal mining company, and the rest – oil and natural gas extraction companies.

The item "Assistance to Defenders" is the largest one in the category – it accounted for 42.18% of all funds voluntarily spent by material companies for social needs in 2023. The total amount of the reported payments is UAH 2,579,186.54.

The 2022 EITI Report presents data from 65 material reporting companies that submitted the relevant information through the UAEITI Portal. Given that the current reporting template collects expenditure data without distinguishing between social and environmental spending, the Independent Administrator has classified these expenditures into the following categories:

The first 6 categories are considered subtypes of payments for social purposes, and the category of environmental expenditures is highlighted separately.

In addition, in connection with a full-scale invasion of the territory of Ukraine in 2022, a significant amount of voluntary spending by mining companies was directed to the needs of military formations and to help citizens affected by hostilities. For this reason, the Independent Administrator has singled out the expenditure category "Assistance to defenders and strengthening the defense capability of Ukraine". This additional category in 2022 includes purchases of vehicles and fuel, personal protective equipment, tactical equipment and other purchases aimed at the needs of defenders.

Also, part of the expenses of accountable companies in the extractive industry were directed to the support of internally displaced persons, military families and humanitarian aid. The specified expenditure items are combined into the "Charity" category.

Among the material companies, 19 companies submitted information on spending for social purposes, six of which belong to the iron ore mining industry, one each to the titanium ore and hard coal mining industries, and the rest to the oil and natural gas mining industry.

The 2021 EITI Report presents data of material reporting companies, the total volume of funds directed to social and environmental goals amounted to UAH 44,524.02 million. In terms of target directions, the largest share of social and environmental costs of accountable companies was attributed to the category "Education and science, support of educational institutions" - UAH 13,134.07 million, or 29.50% of total payments.

In terms of administrative regions, the largest part of the funds was directed to the support of communities in the Poltava region - UAH 25,572.71 million, or 57.44% of the total payments.

Of the 54 material reporting companies for EITI Report 2020, 24 material companies provided information on spending on social and charitable purposes, of which 14 companies operate in the field of oil and natural gas production, 8 companies in the field of iron ore mining, and 2 companies in the field of hard coal mining. According to the data of the companies, their total payments for social and charitable purposes in 2020 amounted to UAH 1,152.38 million.

In terms of target areas, the largest share of social and charitable expenses of accountable companies was assigned to the category "Health care, support of medical institutions" - UAH 663.94 million, or 57.61% aggregate payments.

In order to disclose in the EITI Report for 2019 information on the expenditures of mining companies for social and charitable purposes, the data of the accountable companies, provided by them during the survey, was collected. The division of such costs by the following areas was carried out by the independent administrator:

Information on expenditures for social and charitable purposes was provided by 19 material reporting companies, of which 11 are active in the field of oil and natural gas production, 6 companies in the field of iron ore production, and 2 companies in the field of hard coal production. According to the data of these companies, their total payments for social and charitable purposes in 2019 amounted to UAH 257,829.09 thousand.

In terms of target areas, the largest share of social and charitable expenses of accountable companies was assigned to the category "Support of local communities" - UAH 203,446.16 thousand, or 78.91%. Expenditures in the spheres of "Health care" and "Education and science" amounted to UAH 13,983.68 thousand (5.42%) and UAH 18,844.39 thousand (7.31%), respectively.

In order to disclose in the EITI Report for 2018 information about the expenditures of material reporting companies in the extractive industry for social and charitable purposes, data provided by them during the survey was collected. The distribution of these payments according to their target directions was carried out by the Independent Administrator, as the reporting forms approved by the CMU do not provide for such a division. The following areas were highlighted:

Information on expenses for social and charitable purposes was provided by 18 material reporting companies, of which 10 were active in the field of oil and natural gas extraction, 6 companies - in the field of iron ore extraction, and 2 companies - in the field of hard coal extraction. Total payments for social and charitable purposes in 2018, according to the data of the indicated companies, amounted to UAH 448,125.91 thousand.

In terms of target directions, in 2018 more than half of the social and charitable expenses of material reporting companies in the extractive industries were assigned to the category "Support of local communities" - UAH 355,317.81 thousand, or 79.29%.