EU Development Bank Boosts Funding for Ukraine Gas Supply

The European Union’s development bank has decided to provide additional funds to Ukraine’s state energy firm Naftogaz to secure natural gas supply amid continued Russian attacks on the Ukrainian energy infrastructure. 

The European Investment Bank (EIB), the bank of the European Union, will extend a $147-million (127 million euros) grant to Naftogaz, according to an EIB statement carried by Reuters

Last month, the EIB extended a loan of $348 million (300 million euros) to Naftogaz in an urgent measure to strengthen energy resilience and replenish Ukraine’s long-term gas reserves ahead of winter. 

The loan “will secure energy supply for households and businesses, following damage to Ukrainian infrastructure caused by Russia’s ongoing attacks,” the EIB said in October. 

Russian attacks on Ukraine’s energy infrastructure intensified as temperatures began to drop in the autumn. Ukraine has discussed with G7 countries additional natural gas imports as it seeks to boost imports by 30% to offset the damage from Russian strikes on its gas infrastructure. 

Naftogaz said in early October that Russia launched another massive attack on Ukraine’s gas infrastructure. The targets were civilian facilities that supply Ukrainians with gas during the heating season.  

“As a result of this attack, a significant portion of our facilities has been damaged. Some of the destruction is critical,” Naftogaz CEO Sergii Koretskyi said.

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In the past week, Naftogaz signed an agreement with Polish energy firm Orlen for the supply of U.S. LNG, and agreed with Greek company ATLANTIC-SEE to jointly work to ensure U.S. LNG supply to Europe and Ukraine through Greek LNG terminals and the Vertical Corridor. 

Separately, Ukraine’s imports of electricity from the European Union surged to a 2025 high in October as Russia intensified attacks on the power grid to wreak additional havoc as temperatures drop. 

The Russia-Ukraine war on strategic energy assets has escalated in recent weeks, with Russia targeting gas facilities and power infrastructure in Ukraine, and Ukraine increasing drone strikes on Russian refineries and key export hubs.  

By Michael Kern for Oilprice.com

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