AUR#709 June 10 Shell Signs Oil & Gas Agreement; IFC $200 Million; Sell 25% of Ukrtelecom?; Real Estate Prices; Pres Bush Cancels Trip To Kyiv; World Cup

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ACTION UKRAINE REPORT – AUR           
                 An International Newsletter, The Latest, Up-To-Date
                     In-Depth Ukrainian News, Analysis and Commentary

                      Ukrainian History, Culture, Arts, Business, Religion,

         Sports, Government, and Politics, in Ukraine and Around the World       
 
          SEVENTY-SIX DAYS SINCE UKRAINIAN ELECTION
                      STILL NO COALITION……STAY TUNED
         The Action Ukraine Report brings you the action from Ukraine
                                          and the lack of action.
                       
ACTION UKRAINE REPORT – AUR – Number 709
Mr. E. Morgan Williams, Publisher and Editor  
WASHINGTON, D.C., SATURDAY, JUNE 10, 2006 
           –——-  INDEX OF ARTICLES  ——–
         Clicking on the title of any article takes you directly to the article.               
Return to the Index by clicking on Return to Index at the end of each article
Press Office of President Viktor Yushchenko
Ukrainian News Agency, Kyiv, Ukraine, Thu, June 8, 2006

4.          UKRAINE TEAMS UP WITH SHELL AGAINST RUSSIA
Kommersant, Moscow, Russia, Friday, June 9, 2006

5. IFC TO SUPPORT PROJECT FOR CONSTRUCTION OF PALM OIL
PROCESSION PLANT AT PIVDENNYI SEAPORT IN CRIMEA REGION
                Total cost of production plant will be USD 27 million
Ukrainian News Agency, Kyiv, Ukraine, Thu, June 8, 2006

6.    UKRAINE: IFC MAY PROVIDE DONBASS INDUSTRIAL UNION
                   (DIU – DONETSK) WITH $100 MILLION LOAN
Ukrainian News Agency, Kyiv, Ukraine, April 27, 2006

7. UKRAINE: IFC TO INVEST USD 200 MILLION IN PROJECTS IN 2006

Kostiantyn Druzheruchenko, Ukrainian News Agency
Kyiv, Ukraine, Monday, May 15, 2006

8.    UKRAINE: MINISTER BONDAR PROPOSING INITIAL SALE OF
          25% STAKE IN UKRTELECOM TO CABINET OF MINISTERS
Liudmyla Martynova, Ukrainian News Agency
Kyiv, Ukraine, Monday, May 29, 2006

9.     UKRAINE: UKRTELECOM WILL BE PRIVATIZED, BUT HOW?
                Government decides when, how to privatize Ukrtelecom
Roman Bryl, Ukraine Analyst, IntelliNews – Ukraine This Week
Kyiv, Ukraine, Monday, June 5, 2006

10VNESHTORGBANK (UKRAINE) OBTAINS EUR 10 MILLION LOAN
          FROM CARGILL FINANCIAL SERVICES (UNITED STATES)
Viktor Riasnyi, Ukrainian News Agency, Kyiv, Ukraine, May 29, 2006

11.           GREECE, UKRAINE SEEK CLOSER BUSINESS TIES
Athens News Agency (ANA), Athens, Greece, Thu, June 8, 2006

12SHELTON CANADA CORP ANNOUNCES A DRILLING UPDATE
           FOR WELL LOCATED IN THE SEA OF AZOV, UKRAINE

CCNMathews, Edmonton, Alberta, Canada, Thursday June 8, 2006

                               WARN OF POSSIBLE RISKS AHEAD
By Martin Gelnar, Dow Jones Newswires
Kiev, Ukraine, Wednesday, June 7, 2006

14UKRAINE’S MOBILE-PHONE SUBSCRIBERS ROSE 936,000 MAY
Anna Ivanova-Galitsina, Dow Jones Newswires

Moscow, Russia, Thursday, June 8, 206

15.         UKRAINE-BRAZIL SPACE PROJECT STILL PROMISING 
Defense-Express web site, Kiev, in Russian 19 May 06
BBC Monitoring Service, United Kingdom, Tue, Jun 06, 2006

16.   RUSSIA TURNS UP HEAT AGAIN OVER GAS FOR UKRAINE
           Compromise on price expires this month; new increases sought
By Alan Cullison, The Wall Street Journal
New York, New York, Tuesday, June 6, 2006

17.                 RUSSIA-UKRAINE SHOWDOWN (REVISITED)
EUROLINKS DAILY VIEW: By FREDERICK KEMPE
The Wall Street Journal, New York, NY, Tuesday, June 6, 2006

18.     RUSSIAN GAS BOSS REASSURES EUROPEAN CONSUMERS
   Says Ukraine lagging behind pumping gas into underground storage facilities
NTV Mir, Moscow, in Russian 1500 gmt 6 Jun 06;
Channel One Worldwide (for Europe), Moscow, in Russian 6 Jun 06
BBC Monitoring Service, United Kingdom, Tue, Jun 06, 2006

19.    RUSSIA AND WEST APPEAR SET TO CLASH OVER UKRAINE
Will Moscow demand Ukrainian infrastructure as price of integration with West?
ANALYSIS & COMMENTARY
: Igor Torbakov
Eurasia Daily Monitor, Volume 3, Issue 112
Jamestown Foundation, Wash D.C., Friday, June 9, 2006

20BUSH TO MARK ANNIVERSARY OF HUNGARIAN REVOLUTION
       Trip to Kiev put aside because a new government has not been formed
Associated Press (AP), Washington, D.C., Thursday, June 8, 2006

 
21.         PRES BUSH TO VISIT HUNGARY JUNE 22, KIEV LATER 
Agence France Presse, Washington, D.C., Thu, June 8, 2006
 
22.        A NATION UNITES FOR UKRAINE DEBUT IN WORLD CUP
By Kevin O’Flynn, Staff Writer, Moscow Times
Moscow, Russia Wednesday, June 7, 2006. Issue 3427. Page 24.
 
 
24VOLYN UKRAINIAN SONG & DANCE CO STARTS CANADIAN TOUR
         Performance embodies the best Ukraine has to offer in the art of spectacular
                 folkloric dance, song, and music. Volyn is the Spirit of Ukraine!
Abaze Productions, Toronto, Ontario, Canada, June 9, 2006
 
                         IN AMSTERDAM’S NIEUWE KERK MUSEUM
Press office of President Victor Yushchenko
Kyiv, Ukraine, Thursday, June, 8, 2006
 
26UKRAINE’S FIRST LADY VISITS NETHERLANDS, MEETS WITH
       DUTCH HUMANITARIAN AND CHARITABLE ORGANIZATIONS
Press office of President Victor Yushchenko
Kyiv, Ukraine, Thursday, June 8, 2006
 
Action Ukraine Report (AUR) #709, Article 27
Kyiv, Ukraine, Friday, June 9, 2006
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1
SHELL AND UKRAINE’S UKRGAZVYDOBUVANNYA SIGN WIDE-
    RANGING OIL AND GAS EXPLORATION TREATY IN HOLLAND

Edited Press Release, Dow Jones Newswires
Amsterdam, Holland, Thursday, June 8, 2006

AMSTERDAM – Ukrgazvydobuvannya (UGV) and Shell Exploration and

Production (Shell) on Thursday signed a wide-ranging oil and gas exploration
Joint Activity Agreement (JAA) at a ceremony attended by Ukraine President
Viktor Yuschenko.

The agreement – which covers licenses, agreed work programme levels and the
terms of joint activities – was signed at a ceremony held at Royal Dutch
Shell’s headquarters in The Hague.

Joining President Yuschenko at the ceremony was National Joint Stock Company
NaftogazUkrainy (NAK) Deputy Chairman Bohdan Klyuk, UGV Chairman Ilya
Rybchych, Chief Executive of Royal Dutch Shell, Jeroen van der Veer and Rien
Herber of Shell Exploration and Production Europe.

UGV is a subsidiary of NAK and this JAA represents a further important
milestone in cooperation between NAK and Shell following an agreement in

May 2005 to carry out joint studies in the Dniepr Donets Basin, in
central-eastern Ukraine. The agreement covers an area of more than 31,000
km sq, and is thought to contain potentially significant resources of natural
gas.

Under the terms of the JAA, Shell has farmed-into eight UGV held licenses in
the Dniepr Donets Basin with access to deep potential reservoirs, which
partly lie beneath large scale shallower fields already in production.

Shell will acquire a 50% interest in the JAA covering these licenses
(excluding the producing fields) in exchange for a commitment that comprises
acquisition of seismic data and drilling of deep exploration wells over a
three-year timeframe. Work is planned to commence in June 2006.
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Shell website: http://www.shell.com
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2. PRESIDENT YUSHCHENKO HAPPY TO SEE SHELL IN UKRAINE
 
Press Office of President Viktor Yushchenko
Kyiv, Ukraine, Thursday, June 8, 2006

KYIV – Victor Yushchenko is happy Royal Dutch Shell will soon work on

Ukraine’s energy market.  He said a deal to explore and produce oil and gas
in Ukraine, signed between Ukrgazvydobuvannya, Naftogaz daughter
company, and Shell Exploration and Production, would “definitely stimulate
the company’s activities in Ukraine.”

“This is the first time the world’s leading oil company, Shell, steps on
Ukrainian soil,” he told journalists in Amsterdam. “Ukraine has been
negotiating the terms of this agreement for eight years. But always wanting
to produce oil and gas, we have been signing protocols instead.”

Mr. Yushchenko then said Shell CEO Jeroen van der Veer would come to

Kyiv in thirty days to continue today’s negotiations. The Head of State said
the company was going to help Ukraine produce biological fuel and natural
gas, open gas stations throughout the country and explore hydrocarbons
in the Black Sea.

The President also explained that a recently signed memorandum of
understanding between Naftogaz and Shell would allow the Dutch company

to transport produced gas to its consumers.           -30-
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3. UKRHAZVYDOBUVANNIA AND SHELL REACH AGREEMENT ON
   PROSPECTING FOR AND MINING OF OIL AND GAS IN UKRAINE
 
Ukrainian News Agency, Kyiv, Ukraine, Thu, June 8, 2006

KYIV – The Ukrhazvydobuvannia company, a subsidiary of the Naftohaz

Ukrainy national joint-stock company, has reached agreement with Shell
Exploration Company B.V. (Netherlands) on prospecting for and mining of
crude oil and natural gas on the territory of Ukraine. The Ukrainian presidential
press service announced this in a statement, the text of which Ukrainian News
has obtained.

Ukrhazvydobuvannia’s Director-General Ilia Rybchych and Shell Exploration
Company B.V.’s Vice President Rien Herber signed the agreement between
Ukrhazvydobuvannia and Shell Exploration Company B.V. on development

and mining of oil and gas deposits in Ukraine at the Hague in the presence of
President Viktor Yuschenko.

The document allows Shell Exploration Company B.V. to immediately start
prospecting operations in Ukraine. According to the agreement, Shell’s first
investment in prospecting for oil and gas in Ukraine will amount to USD 100
million.

Shell Exploration Company B.V. and Naftohaz Ukrainy also signed a

memorandum of mutual understanding access to Ukraine’s gas transport
system and guaranty of transit of natural gas through Ukrainian territory.
Herber and Naftohaz Ukrainy’s Deputy Board Chairman Bohdan Kliuk
signed the memorandum.

Yuschenko expressed interest in the operation of Shell Exploration Company
B.V. ‘We are interested in Shell starting serious operations in Ukraine,’
Yuschenko said.  Yuschenko met with Shell Exploration Company B.V.’s
President Jeroen van der Veer before the signing of the documents at The
Hague.

In December 2005, Naftohaz Ukrainy and Shell Exploration and Production BV
signed an agreement in Kyiv on cooperation in joint research, development,
mining, marketing, and sale of hydrocarbons.

This is the second stage of the agreement between the two companies, which
agreed in May 2005 on cooperation in the area of technical research leading
to exploration for and extraction of natural gas in the Dniprovsko-Donetska
basin.                                          -30-

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4.      UKRAINE TEAMS UP WITH SHELL AGAINST RUSSIA

Kommersant, Moscow, Russia, Friday, June 9, 2006

Shell Exploration has entered into an agreement with NAK Naftogaz
Ukrainy subsidiary, Ukrgazdobycha, to produce oil and gas at the fields
of Dnepr and Donetsk basin.

In the Ukrainian government, they hope this cooperation will reduce
dependency on Russia. But Shell could have just set stakes in Ukraine and
will hardly proceed to exact production in the nearest future.

Ukrgazdobycha General Director Ilya Rybchich and Shell Exploration Vice
President Rien Herber sealed an oil/gas cooperation agreement in The Hague
Thursday, June 8, 2006. “First time over 15 years of our independence, a
leading world company, Shell, sets foot on the soil of Ukraine,” Ukrainian
President Viktor Yushchenko, who attended the signing, said emphasizing the
negotiations lasted for eight years.

The yesterday’s agreement authorizes Shell to immediately start exploration
of the fields of Dnepr and Donetsk basin, gives access to the gas transport
system of the country and guarantees gas transit via it. But it doesn’t
stipulate production volume, provisions of production or the project
duration. Nevertheless, spokesmen of Yushchenko’s office are sure Shell
will funnel at least $100 million in the exploration.

The agreement with Shell will enable Ukraine to reduce dependency on the gas
and oil of Russia and to break Gazprom’s monopoly on gas transit via its
pipelines, spokesmen of press service of Ukrainian government said.

The analysts are not so optimistic, as the field offered to Shell may
annually yield no more than 1 million tons of oil or 5 billion cu meters of
gas, all of the amount to be sold in Ukraine. Besides, Shell is known for
setting stakes worldwide, but it may get down to the actual production in
Ukraine only in the distant future.                   -30-

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LINK: http://www.kommersant.com/page.asp?id=680886
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5. IFC TO SUPPORT PROJECT FOR CONSTRUCTION OF PALM OIL
PROCESSION PLANT AT PIVDENNYI SEAPORT IN CRIMEA REGION
                Total cost of production plant will be USD 27 million

Ukrainian News Agency, Kyiv, Ukraine, Thu, June 8, 2006

KYIV – The International Finance Corporation intends to provide a loan of
USD 17.5 million for Delta Wilmar CIS, a Ukrainian-Singaporean joint
enterprise, for financing construction of a factory for processing palm oil
at the Pivdennyi merchant seaport (Odesa region). A representative of Delta
Wilmar CIS announced this to Ukrainian News.

The representative said that a final decision on the issue of provision of
the loan would be made at a meeting of the board of directors of the
International Finance Corporation in late June. According to him, the total
cost of the project for construction of the factory is USD 27 million. The
factory will have a capacity of 1,500 tons per day.

The representative said that the first phase of the project, which involves
construction of warehouses, would be completed in June while the second
phase, which involves the launching of the factory’s operation, will be
completed in September.

The factory will process raw palm oil imported from Malaysia and Indonesia
and sell its products on the CIS market. According to the source, Delta
Wilmar CIS is a joint venture between Delmar Pte Limited of Singapore

(80%) and the Khlibna Havan trading house of Ukraine (20%).

As Ukrainian News earlier reported, Delta Wilmar CIS, a limited liability
enterprise, started construction of a complex for processing tropical oils
at the Pivdennyi merchant seaport in April 2005. The Pivdennyi merchant
seaport is located on the coast of the Adzhalyk estuary in the Odesa region.

It specializes in handling all types of cargo operations, warehousing and
auxiliary operations, and processing of bulk and general cargoes transported
by sea, rail, and road. The port has specialized complexes for transshipping
mineral fertilizers and bulk chemical cargoes and docks for loading bulk and
general cargoes for export. The port employs 3,500 people.     -30-
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6.  UKRAINE: IFC MAY PROVIDE DONBASS INDUSTRIAL UNION
                  (DIU – DONETSK) WITH $100 MILLION LOAN

Ukrainian News Agency, Kyiv, Ukraine, April 27, 2006

KYIV – The International Finance Corporation, part of the World Bank group,
may provide a credit worth USD 100 million to the Donbas Industrial Union
(DIU, Donetsk). This follows from a statement by the IFC.

According to the report, the credit may be given for the DIU to implement a
project of ecological programs at the Alchevsk metallurgical plant, Alchevsk
coke and chemical plant (Luhansk region) and Dniprovskyi metallurgical plant
named after Dzerzhynskyi, including a program for closing open-hearth
furnaces, and to carry out programs for reducing energy inputs and
increasing production competitiveness.

The project’s total cost is USD 1.1 billion, including a USD 100 million
credit from the IFC, and a USD 250 million syndicated loan with the IFC’s
participation. The IFC’s board of directors plans to consider the question
on granting the credit to the DIU on June 8.

As Ukrainian News earlier reported, the DIU intends to draw USD 200 million
of foreign loans in 2006. The DIU also intends to refinance USD 500 million
in 2006.

The DIU specializes in the production and sale of metal goods. It controls
the Alchevsk and Dniprovskyi metallurgical plants, the Kramatorsk-based
Kuibyshev metallurgical plant, the Dnipropetrovsk pipe plant, the Alchevsk
coke and chemical plant, the Panteleimonivka refractory plant, as well as
the Dunaferr and the DAM Steel metallurgical plants in Hungary and the Huta
Czestochowa steel plant in Poland, among other assets.

The Azovinteks company (Mariupol) and the Vizavi company (Donetsk) each

owns a 49.99-percent stake in the DIU corporation while the Oniks Don
company (Donetsk) owns 0.02%.

DIU Board Chairman Serhii Taruta controls Azovinteks while the Industrial
Group consortium president and administrator of DIU’s assets Vitalii Haiduk
controls Vizavi.                                  -30-
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7. UKRAINE: IFC TO INVEST USD 200 MILLION IN PROJECTS IN 2006

 
Kostiantyn Druzheruchenko, Ukrainian News Agency
Kyiv, Ukraine, Monday, May 15, 2006

In 2006 the International Finance Corporation (IFC) of the World Bank group
plans to invest into projects in Ukraine more than USD 200 million.
Ukrainian News learned this from the IFC manager in Ukraine Olena Voloshyna.
“We have several projects now, which are in the workup,” she said.

According to her, these are the large-scaled projects in the sphere of
development of the retail trade outlets and industry. IFC manager in Ukraine
did not disclose the names of the companies which are to participate in the
projects.

According to her, around 60% of the planned investments will be directed to
the industry and 40% – to the retail trade. As Ukrainian News earlier
reported, as of May 1, IFC participated 23 investment projects in Ukraine.
The investments amounted to USD 480 million. Ukraine is a member of IFC
since 1993.                                      -30-
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8. UKRAINE: MINISTER BONDAR PROPOSING INITIAL SALE OF
     25% STAKE IN UKRTELECOM TO CABINET OF MINISTERS

Liudmyla Martynova, Ukrainian News Agency
Kyiv, Ukraine, Monday, May 29, 2006

KYIV – Acting Transport and Communications Minister Viktor Bondar is
initiating initial sale of a 25% stake in Ukrtelecom, Ukraine’s largest
telecommunications company. Bondar announced this to journalists,
saying that he has proposed such a mechanism to the Cab.

According to Bondar, there are presently many investors who are prepared
to pay EUR 1 billion for a 25% stake in Ukrtelecom, which can be used to
finance development of Ukrtelecom (development of its network and mobile
communications service).

According to Bondar, this 25% stake can later be sold together with the
remaining government stake in the company.

According to him, the investors that invested money in Ukrtelecom will
then be interested in selling the full stake for at least EUR 4 billion.
Otherwise, they will lose. “This is a normal model. It exists, it can be
conducted,” Bondar said.

According to him, realization of the model proposed by him requires
preparation of the relevant draft law and at its passage by the parliament.
Bondar also said that such a model also provides for privatization of
Ukrtelecom over a period of 3-4 years.

Bondar also believes that privatization of Ukrtelecom cannot take place
before 2007, regardless of the decision that the government makes on the
issue.

As Ukrainian News earlier reported, the government has been stating its
intention to privatize Ukrtelecom since 2000, but its privatization has been
repeatedly postponed.

In November 2005, the Cabinet of Ministers again started preparation for
privatization of Ukrtelecom and directed the State Property Fund and the
Transport and Communications Ministry to prepare all the documents
necessary for its privatization.

Meanwhile, the government has not yet determined the possible date of its
privatization and the size of the stake that will be privatized.

According to various estimates, Ukrtelecom could be sold in 2006 for USD
2-4 billion. Ukrtelecom ended the year 2005 with a net profit of UAH 519
million. 7.14% of the shares in the company have been sold to its employees
via the preferential subscription. The remaining 92.86% of the shares are
held by the state.                                  -30-
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9.   UKRAINE: UKRTELECOM WILL BE PRIVATIZED, BUT HOW?
              Government decides when, how to privatize Ukrtelecom

Roman Bryl, Ukraine Analyst, IntelliNews – Ukraine This Week
Kyiv, Ukraine, Monday, June 5, 2006

This week government should give its final approval for the financial plan
of state-owned telecommunication monopolist Ukrtelecom. On Friday, June 2
government approved the draft plan, but some paragraphs should be finalized
tomorrow, on June 6.

The plan itself does not aim only to outline key directions of the company’s
development in 2006, but answers a principle question: when and how the
company will be privatized. Government combines these two issues: financial
plan and privatization. Apart from state officials, representatives of
foreign investment funds are involved in the discussion of the issue.

Ukrtelecom has 2 valuable assets: monopoly on fixed line telecom market and
license for providing 3G servicesAt present Ukrtelecom possesses two
valuable assets that influence directly its investment attractiveness. The
first is a monopoly on the fixed line telecom market.

The company controls 70% of the market and services 9.7mn subscribers. But
the company has no right to change tariffs on its own due to severe control
from the national committee for regulation of the telecommunication market.

It is not excluded that after possible privatization the new investor will
obtain the right to change tariffs. But this point can be regarded an issue
that can influence the company’s price during the negotiations with a
potential investor.

The second valuable asset is the license for providing 3G mobile services.
Ukrtelecom is the only domestic telecom operator that has such a license.
Other companies keep waiting for government to announce a tender for the
license, so they can start to adopt 3G services.

That is why lobbyists of mobile operators tried to protract approval of
Ukrtelecom’s financial plan because they would like to stay behind the state
monopolist in adopting 3G services.

If they fail, Ukrtelecom that has a large number of subscribers and wide
nationwide branch network will surely have a competitive advantage over
other mobile operators. Also, authorities are not interested in giving the
license to a private operator now, thus they postpone the tender. Getting
monopolistic rights for 3G increases Ukrtelecom’s market value before the
privatization.

Government should take steps to keep company’s profitability ———-

But while entering the mobile market, Ukrtelecom should significantly change
its strategy. The company should spend a lot of money on marketing to
promote its new services. To inform you, the key issue of the financial
plan’s finalization is volume of expenditures on advertisement and servicing
attracted loans. Marketing spending can be covered by credits because
government will hardly agree to spend the company’s profit on marketing
needs.

How to use the profit is another key matter. There are two options: to
develop the company or to transfer it into state ownership. The less
spending the company has (meaning government refuses to spend big sums on
technical development, including 3G services), the more chances authorities
have to sell it profitably.

Also, now Ukrtelecom’s profitability is sliding due to new regional
companies entering the fixed line market. That is why Ukrtelecom cut its net
profit forecast by UAH 100mn to UAH 419mn in 2006.

Taking into consideration that net profit made up only UAH 29mn in Q1/06,
the annual target would be difficult to reach.

If government postpones Ukrtelecom’s privatization, profitability will
decrease further. Also, the government should make an unpopular decision to
allow the operator to raise tariffs. Socially oriented tariffs are a serious
argument for an investor to lower the offer for Ukrtelecom.

Transport minister proposes to sell 25% stake at first ———-

The entity’s dim financial prospects are actually not a key factor for its
long-term development. Selling a minority stake to an investor can attract
funds for technical development. That is the most probable outcome
Ukrtelecom’s supervisory board will propose to government, taking into
account the scheme of Ukrtelecom’s privatization.

It might entail selling more than 15% via IPO on an international stock
exchange. This option is worthy because it can be realized quickly: it takes
about half a year after lifting the ban on privatization to carry out an
IPO. This scheme is backed by the state property fund.

Another way of partial privatization backed by transport and communication
minister Victor Bondar is selling 25% to an institutional investor. The
minister said recently there are many investors interested in buying a 25%
stake for EUR 1bn. The company will use these funds to develop mobile
communication and other services.

It helps government to sell over time 100% in the company to another
investor for more than EUR 4bn. The minister is sure 25% previously sold to
an institutional investor can be sold within a 100% stake, and the initial
buyer will be interested in the development of the company to sell its stake
with profit.

The government now examines this privatization option and it is said to be
the primary one. Its supporters forecast that Ukrtelecom’s privatization can
be completed in 3-4 years time.

We believe partial privatization is difficult to fulfill ———-

There are several drawbacks in the plan, in our view. [1] The first one:
sector experts doubt that 25% in the company can be sold for EUR 1bn and
respectively that Ukrtelecom’s market value can reach EUR 4bn. [2] The
second is the political instability in the country.

The scheme supposes a rather long period of preparation for privatization.
It is possible that every new government (who knows how many governments

the country will have in next 3-4 years?) can make their changes to the
privatization scheme.

To keep the mechanism unchanged, it is necessary for the company to receive
support of a domestic finance and industrial group that eyes a stake in the
telecom monopolist. After obtaining some guarantees, the local investor will
be interested in keeping the scheme unchanged. Then again, no local investor
is protected from re-privatization.

In fact, there is not much difference for the government what origin the
investor will be of. But it has strict requirements for a potential bidder:
volume of total assets should amount to at least USD 10bn; high credit
ratings (not less that BB with S&P and Fitch, and Ba2 with Moody’s);
experience of activity on the telecommunication market of at least 5 years;
experience in privatization of telecommunication monopolies, and etc.

Only large foreign operators such as France Telecom, Vodafone, Deutsche
Telekom meet such demands, but not any local company. Government, of

course, can soften the criteria, but in this case parliament must approve
amendments to the law on Ukrtelecom. It would take extra time.

State authorities agree to sell Ukrtelecom but they still do

not know whom to: local or foreign investor ———-

The acting government definitely intends to privatize Ukrtelecom. The
company’s new financial plan proves it. The new government that will be
elected after the creation of a ruling parliament coalition also supports
the idea, thus we do not expect a delay with privatization.

The main obstacle regarding the new government is that there will be a lot
of supporters of the idea that the state telecom monopoly should belong to
an indigenous investor. Defining the name of the potential buyer is the next
step in the long process of Ukrtelecom’s privatization.

Worth noting, if parliamentary election winner Party of Regions will enter
the ruling coalition after all, the political situation will not change
significantly in the next 2-3 years. The party can easily soften criteria
for Ukrtelecom’s buyer. This would spur the privatization.

If talk about possible reprivatization subsides (as we expect it to in time,
if the coalition is market-friendly), we think both foreign or local
investors may be willing and able to pay USD 3-4bn for Ukrtelecom. In that
case, a domestic buyer would be preferable for state authorities, maybe in
consortium with a foreign investor.                   -30-
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10. VNESHTORGBANK (UKRAINE) OBTAINS EUR 10 MILLION LOAN
           FROM CARGILL FINANCIAL SERVICES (UNITED STATES)

Viktor Riasnyi, Ukrainian News Agency, Kyiv, Ukraine, May 29, 2006

KYIV – Vneshtorgbank (Ukraine), a subsidiary of Russia’s Vneshtorgbank,
has obtained a loan of EUR 10 million from Cargill Financial Services Inc.
(United States). The bank announced this in a statement.

The loan was obtained for a period of 345 days. The interest rate is not
subject to disclosure, the statement said. The money will be used to finance
the credit operations of the bank.

Index Bank, Donhorbank, Ukrprombank, and Mria bank have earlier obtained
various amounts of loans from Cargill Financial Services Inc. Cargill
Financial Services International Inc. is registered in the United States as
a joint-stock company. Its areas of operation are provision of loans and
other trade and financial operations.

The assets of Vneshtorgbank (Ukraine) were valued at UAH 541.3 million as
of April 1, 2006, when its credit portfolio amounted to UAH 386.5 million
and
its capital amounted to UAH 276.3 million. Vneshtorgbank (Ukraine) is
registered as a closed joint-stock bank. Russia’s Vneshtorgbank owns 100%
of the shares in it.                           -30-

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11.  GREECE, UKRAINE SEEK CLOSER BUSINESS TIES

Athens News Agency (ANA), Athens, Greece, Thu, June 8, 2006

KIEV – Economic links between Greece and Ukraine are lagging excellent
political and cultural ties, Deputy Foreign Ministry Euripides Stylianidis
said on Wednesday. “There is great leeway to upgrade business ties,”
Stylianidis said during a visit to Ukraine at the head of a 50-member
delegation to Ukraine.

On Thursday, a joint ministerial committee of the two countries is due to
sign a protocol for economic, industrial, technological and scientific
cooperation. Other agreements will be signed for telecommunications and
standardisation. Stylianidis also met Ukraine’s deputy foreign and finance
ministers for talks.

He also addressed a Greek-Ukrainian business forum on the sidelines of the
committee’s meeting, saying that bilateral trade was low, despite rising to
250 million US dollars in 2005; and that the trade balance was in Ukraine’s
favour. “This needs to be equalised, benefitting both countries,” he noted.

Stylianidis also pointed out that Greek investments in Ukraine totalled
about 350 million dollars from 80 companies. Among them are a subsidiary
of Athens-quoted engineering contractor Mechaniki; and Athens-quoted
Germanos, which is expected to run 300 stores in Ukraine by 2008. Greek
firms were especially interested in construction projects in Ukraine, along
with tourism and energy, he added.                   -30-
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http://www.ana.gr/anaweb/user/showplain?maindoc=4312088&maindocimg=4308414&service=102
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12. SHELTON CANADA CORP ANNOUNCES A DRILLING UPDATE
           FOR WELL LOCATED IN THE SEA OF AZOV, UKRAINE

CCNMathews, Edmonton, Alberta, Canada, Thursday June 8, 2006
EDMONTON, ALBERTA– Shelton Canada Corp. (“Shelton”)
(TSX VENTURE:STO – News) announces a drilling update for its
exploration West Birjuchja No.1 well, located in the Sea of Azov, Ukraine.

The offshore West Birjuchja No. 1 exploration well, which was spudded

May 9th, is currently beyond 1000 meters and drilling is on schedule to a
planned total depth of 1,700 meters.

Shelton has a 50 percent interest in the West Birjuchja well. It is
anticipated that it will take twenty (20) more days to drill and log the
well. An additional thirty (30) days is expected for completion and testing.

Zenon Potoczny, President and CEO, commented: “The Shelton team has

just visited the “Sivash” drilling rig at the location and we are pleased to
report that drilling on West Birjuchja No.1 well is proceeding according to
plan.”

At the Ukrainian Investment Summit in London, England (May 23rd & 24th), Mr.
I. Franchuk, Chairman of the Board of Chernomornaftogas, in a plenary speech
commented “A first step in (offshore investments) is the development of Azov
Sea offshore area jointly with a Canadian public company “Shelton Canada
Corp.”. At this time a drilling of the first exploratory well at West
Birjuchja field has already started.

We hope that this cooperation will be the beginning of active development of
the Azov-Black Sea region by Ukrainian and foreign companies. The fact that
the Azov-Black Sea region is a part of Alpine-Himalayan orogenic fairway,
where the biggest oil and gas regions of Iran, Iraq, Azerbaydzhan, Northern
Caucasia and Romania are located, proves its prospectivity.”

Shelton, a junior oil and gas company listed on the TSX Venture Exchange,
holds interests in producing properties located in northeastern British
Columbia and north central Alberta. Shelton also holds petroleum and natural
gas concessions in southern Ukraine.

Certain statements contained in this press release may be considered as
“forward looking”. Such “forward looking” statements are subject to risks
and uncertainties that could cause actual results to differ materially from
estimated or implied results.

The TSX Venture Exchange has not reviewed and does not accept

responsibility for the adequacy or accuracy of this release.       -30-
————————————————————————————————–
Contact: Zenon Potoczny; Shelton Canada Corp.
President & CEO; (416) 252-4101; Email: zenon@sheltoncdn.com
Richard Edgar; Shelton Canada Corp., Director; (403) 205-2526 ext 4
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========================================================
13. UKRAINE: AS KIEV REAL-ESTATE PRICES SURGE, SOME
                        WARN OF POSSIBLE RISKS AHEAD

By Martin Gelnar, Dow Jones Newswires
Kiev, Ukraine, Wednesday, June 7, 2006

KIEV, Ukraine — Property prices in Ukraine’s capital have risen rapidly in
the past few years, fueled by an influx of people and a shortage of
apartments and office space. While some observers expect prices to rise
further, others say they may have peaked, citing concerns such as a recent
sharp price increase and political instability.

Signs of economic recovery and the opening of the country under President
Viktor Yushchenko, who came to power after the peaceful mass protests of the
Orange Revolution in late 2004, have increased Ukraine’s attraction for
Western investors.

Residential-property prices have risen to $2,600 a square meter this year,
from around $360 a square meter in mid-2002. Office property prices have
also skyrocketed and now are 25% to 30% higher than residential prices,
according to real-estate agency Teren Plus of Kiev.

Kiev has become second only to Moscow as Eastern Europe’s most expensive
market for office space, according to property-research company DTZ Holdings
PLC of London, which expects prices to keep rising. Kiev’s annual occupancy
costs per employee, including taxes, maintenance and rent, are expected to
rise to $5,620 this year, up 15% from the 2005 average, a DTZ survey taken
in January showed.

That compares with expected occupancy costs of $4,760 in Budapest, $3,980 in
Prague and $3,240 in Warsaw, propelling the Ukrainian capital to No. 53 this
year from No. 67 in 2005 — above The Hague and Boston, for example — in a
global list of 118 urban areas.

Kiev, with a location on one of Europe’s major transportation corridors, is
the economic hub of Ukraine, Europe’s second-largest country by land mass
after Russia, with 50 million inhabitants. The emerging market is attracting
interest from all business sectors, says Peter Murphy, research coordinator
at DTZ.

Zurich-based investor Peter Vrkljan says he has recently realized returns of
50% to 70% over a 12- to 18-month period on two Kiev property sales,
benefiting from a spike in prices after the Orange Revolution. But Mr.
Vrkljan says the window of opportunity may be closing because of the high
prices and political uncertainties.

Richard de Rooy, managing director of Middle Europe Investments BV,
Netherlands, which is active in commercial property and private equity in
Eastern European countries, also is wary. “We are reluctant to look at the
Ukraine at the moment because of the political instability. Nobody knows
where Yushchenko will be a year from now,” he says.

Mr. Yushchenko’s position was weakened last year after he sacked another
Orange Revolution hero, Yulia Tymoshenko, as prime minister because of
personal differences.

A construction company needs about 80 permits to do business in Kiev, a
situation that opens the door to bribery, says Vitaliy Vavryshchuk, an
economist with independent think tank Case Ukraine in Kiev.

Economic growth also is cooling. Gross domestic product in Ukraine rose a
respectable 2.6% last year, though still below the estimated 4.6% average
for Central and Eastern Europe and the Baltic states, according to the
European Bank for Reconstruction and Development. The bank forecasts
Ukraine’s growth to slow to 1.2% this year.                   -30-
————————————————————————————————
Write to Martin Gelnar at martin.gelnar@dowjones.com
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14. UKRAINE’S MOBILE-PHONE SUBSCRIBERS ROSE 936,000 IN MAY

Anna Ivanova-Galitsina, Dow Jones Newswires

Moscow, Russia, Thursday, June 8, 206

MOSCOW – The number of Ukrainian mobile-phone subscribers rose in May

by some 936,000 to 34.77 million, consultants Advanced Communications &
Media said in a release Thursday. The net rise represents an acceleration from
885,000 added in April.

Penetration, or the percentage of all Ukrainians using a mobile phone, rose
to 73.0% at the end of May from 71.1% at the end of April. Kyivstar,
controlled by Norway’s Telenor ASA (TELN), had the largest share of new
additions or 35.6%.

AC&M gave the following breakdown of the largest operators’ subscriber
details for Ukraine. UMC is owned by Russia’s OAO Mobile TeleSystems

(MBT), Astelit is owned by Turkcell Iletisim Hizmetleri AS (TKC) and URS
is a unit of Russia’s OAO Vimpel Communications (VIP).

Operator            May               April                    On Month
Kyiv         15.479 Mln     15.146 Mln            +333,000
UMC             14.850 Mln     14.596 Mln            +254,272
Astelit              3.800 Mln       3.500 Mln            +300,000
URS              446,658            402,672                 +43,986
AC&M Web site: http://www.acm-consulting.com
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Anna Ivanova-Galitsina, Dow Jones, anna.galitsina@dowjones.com
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15.   UKRAINE-BRAZIL SPACE PROJECT STILL PROMISING 

 
Defense-Express web site, Kiev, in Russian 19 May 06
BBC Monitoring Service, United Kingdom, Tue, Jun 06, 2006

The Cyclone-Alcantara space project, involving Ukrainian booster rockets and
a Brazilian launch site, remains promising despite the lack of funding and
long delays, a Ukrainian web site has said. The Ukrainian-Brazilian joint
venture has so far failed to agree its founding documents.

Meanwhile, a Russian-French competitor space project is making progress

and Russia is keen to talk Brazil into abandoning space cooperation with
Ukraine. However, the Ukrainian project is cheaper and Brazil has opted for
Ukraine. Therefore, the project is likely to be implemented, the web site
said.

The following is the text of an article by Olha Kalynovska entitled
“Cyclone-4: the best unrealized launcher” and published by the Ukrainian
Defense-Express website on 19 May; subheadings inserted editorially:

          STRENGTHS OF UKRAINE-BRAZIL PROJECT 
The Ukrainian-Brazilian project to orbit a Ukrainian Cyclone-4 booster
rocket from Brazil’s Alcantara launch centre has been a central priority for
Ukraine’s space industry for many years. This is the third project which
promises to become the second or even first largest one in the commercial
history of Ukraine’s space industry, experts say. No-one can tell when this
may happen though.

In theory, this project has great advantages over other similar ones. Its
main strength is that the Alcantara launch centre is close to the equator.
This proximity enables the launcher to orbit 30-40 per cent more payload by
the use of an extra component of the Earth rotation velocity in this area.
Thus the Brazilian launch centre can launch its customers’ spacecraft at
half-price compared with ordinary launch sites.

In addition, Alcantara offers its customers a wide range of launch azimuths.
Lastly, favourable climatic conditions, low population density in the
region, easy delivery of booster rockets, spacecraft and equipment by sea
and by air also promise to add popularity to the launch complex.

As regards the new rocket, the Cyclone-4 epitomizes the best achievements

of the Pivdenne design bureau over the many years it has been building
spacecraft, according to its designer-general Stanislav Konyukhov.

The designed characteristics of the Cyclone-4 enable it to take up to 5.5
tonnes of payload into a circular low earth orbit (LEO) and up to 1.7 tonnes
into a geosynchronous transfer orbit (GTO). This is achieved by the use of a
third stage having a triple load of propellant components (compared with the
third stage of the Cyclone-3) and due to high energy-mass perfection which
enables the rocket to improve its energy performance and reduce its
longitudinal load factor.

The engine of the third stage of the booster rocket has a multiple start
feature which creates qualitatively new opportunities which can be used in
the group orbiting of spacecraft. The Cyclone-4 is complete with a
high-precision control system using the Global Positioning System (GPS).

It is a great advantage of the new rocket that all operation with it on the
launch complex is automated, which ensures absolute safety for personnel.
The Cyclone-4 was designed with special attention being given to
environmental safety: its technical solutions make impossible any emission
of toxic propellant components into the environment at all phases of the
operation of the complex.
Partners’ responsibilities

The sides have distributed their responsibilities under the project in the
following way. Ukraine has bound itself to design the booster rocket and the
ground equipment for the rocket complex. More than 50 Ukrainian space
enterprises are involved in this work.

Among them are the National Academy of Sciences of Ukraine with a number

of its institutes, the Novokramatorsk works, the research institute for
electronic measurements in Kharkiv, the vehicle assembly plant in Odessa,
the chemical works in Pavlohrad, the Antekskhimavtomatika science and
production enterprise for chemical equipment in Severodonetsk], the CheZaRa
company in Chernihiv and others. Russian plants are also involved in the
project.

Under the field supervision of Ukrainian specialists, the Brazilian side has
committed itself to building and assembling facilities for the installation
of production equipment and general engineering systems to adapt the
Cyclone-4 space complex to Alcantara. Brazilians will also create a
transport infrastructure to carry rockets from the seaport to the launching
pad.

Overall financial investments are estimated at 180m dollars with the
Ukrainian and Brazilian sides paying 90m each. The Ukrainian government has
decided to involve foreign funds and taken 150m dollars in an international
credit against government guarantees. Yet specialists say too scanty
resources have been planned for the project. A Ukrainian-Brazilian joint
venture, Alcantara-Cyclone-Space, will be running the project at every
stage.

The venture will get the exclusive right to employ the new booster. The
project participants expect to have six to 10 Cyclone-4 launches annually.
The sides have spent more than one year trying to get the joint venture
founding documents approved. The Brazilian side has failed so far to select
its subcontractor and clear all legislative obstacles.

The production sector has nothing to boast either. According to the latest
data from the Brazilian side, they have just decided on the location of the
Ukrainian booster base. There is nothing to be heard about efforts being
launched to build the ground infrastructure. The Ukrainian side is moving to
its goal at a faster pace failing nonetheless to keep to the time frame. The
first launch was originally expected to take place by the end of this year.
Now even the next two or three years are called into question.

                          THIRD PARTIES’ INTERESTS 
Experts see the roots of this problem in Russia taking an active interest in
Brazil since the Cyclone-4-Alcantara project got started. The thing is that
Russia is Ukraine’s main competitor over this project today. Russians are
trying their hand at a joint project with France to launch a new Soyuz
booster from the Kourou space centre in French Guiana. The Russian project
has got off the ground despite serious problems, although they were less
difficult than those facing the Ukrainian-Brazilian project.

They have got their first customers. It should not be ruled out that Russia
may try to win over Brazil when the Soyuz-Kourou project has taken off. One
Latin American state joining the project as a partner, some others will get
involved automatically, in particular, Argentina which is already
negotiating the development of its domestic space segment both with Ukraine
and Russia.

Despite enormous problems facing the Cyclone-4-Alcantara project, there is
one comfort. Having a choice, Brazil has opted for Ukraine. The Brazilian
Space Agency once held talks with the US companies Lockheed, Boeing and
Orbital Science and with Russia’s Khrunichev rocket centre. The talks were
terminated for various technical and commercial reasons.

The Cyclone-4 appeared to be the best choice for Brazil in terms of the
class of spacecraft to be orbited and on all technical points. The Cyclone-4
is regarded as a high-reliability booster. Its high reliability is based on
continuity: the Cyclone-4 was designed on the basis of the Cyclone-2 and
Cyclone-3 boosters having a total of 224 launches to their credit with five
failures.

Brazil’s choice is attributable to the cost of project implementation. It is
obviously much costlier in Russia than in Ukraine. Thus for instance,
specialists of the Pivdenne design bureau have compared the
Cyclone-4-Alcantara and the Soyuz-Kourou projects to find out that the
relocation of the Russian Soyuz booster to the Kourou launch centre in
French Guiana is twice as costly as adapting the Cyclone-4 booster to the
Alcantara launch complex.                        -30-
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16. RUSSIA TURNS UP HEAT AGAIN OVER GAS FOR UKRAINE
           Compromise on price expires this month; new increases sought

By Alan Cullison, The Wall Street Journal
New York, New York, Tuesday, June 6, 2006

MOSCOW — The tense truce between Russia and Ukraine over natural-gas
shipments is coming under renewed pressure as Russia again seeks price
increases from its neighbors.

So far, there is no sign of a return to the ultimatums that preceded
Moscow’s decision to briefly cut off supplies in a price dispute in January.
That cutoff resulted in interruptions in deliveries to Russia’s European
customers, who get most of their supplies through pipelines across Ukraine,
and set off a wave of criticism that Moscow was using its vast energy
resources as a political weapon.

But the compromise later that month that resolved the crisis, nearly
doubling the price Ukraine pays for Russian gas, expires at the end of June.
Executives of Russian state gas monopoly OAO Gazprom have publicly

indicated they would like to see another price increase. In Kiev, where rising
gas prices are expected to hurt economic performance, government officials
haven’t publicly acknowledged that the rates might go higher.

Gazprom also has been pushing other customers in the former Soviet Union for
price increases over the past few weeks. Even Belarus, whose authoritarian
government enjoys strong support in Moscow and the lowest price in the
region for Russian gas, is facing a demand that it pay double or triple its
current rate starting next year.

Russian President Vladimir Putin told a group of foreign media executives
Friday that if the West wants Ukraine to pay below-market prices for its
gas, then Western governments should pick up the cost.

“Why should consumers in Germany pay $250 per thousand cubic meters and
those in Ukraine $50? If you [the West] want to give Ukraine that kind of
gift, then pay for it,” Mr. Putin said.

Mr. Putin noted that Russia in past years had provided subsidies in the form
of discounted gas worth $3 billion to $5 billion annually. Western
governments so far have shown little willingness to provide such large-scale
aid to Kiev.

Gazprom officials say politics has nothing to do with the pricing
discussions, noting that the company simply is seeking to end the practice
of selling to former Soviet countries at prices far below market levels.
Moreover, much of the gas that Russia supplies to Ukraine comes from
Turkmenistan, which is seeking higher prices from Russia.

But in Russian dealings with Ukraine, where President Viktor Yushchenko

has taken a strongly pro-Western line since he took office last year, the gas
trade is more than just business.

“Where there are bad political relations, good economic [affairs] just don’t
happen,” said Viktor Chernomyrdin, Russia’s ambassador to the Ukraine,
according to the Interfax news agency last week. Mr. Chernomyrdin said that
Ukraine’s declared intention to join NATO membership is a major irritant to
relations, and that Ukraine might have an easier time in gas talks if
relations with Moscow were better. “Politics and economics are unfortunately
inseparable,” he said.

Ukraine’s industry, burdened by inefficiencies dating to Soviet days,
remains dependent on cheap gas shipped in from Russia and Central Asia.
Ukraine argues that a sharp increase in rates could be devastating to the
country’s economic growth, which the government expects to fall short of
2005’s 2.4%.

“Everyone hopes there won’t be another shut-off, but they do expect some
difficult negotiations,” said Andriy Bespyatov, head of research at Dragon
Capital brokerage in Kiev. “And they do expect some kind of increase in
rates.”

The January conflict cast a shadow on Russia’s debut this year as leader of
the Group of Eight leading nations. Mr. Putin has made energy security a key
theme of the summit in St. Petersburg next month.

The gas tensions come at a difficult time in Kiev, where political leaders
still are trying to forge a ruling coalition more than two months after
parliamentary elections left Mr. Yushchenko’s party in third place, with the
pro-Russian party coming in first.

Under the January gas deal, Ukraine agreed to pay $95 per thousand cubic
meters for its supplies, up from $50 last year. While Kiev expects that it
will have to swallow some kind of rate increase in the next round of talks,
the government is hoping Russia will raise rates gradually to give Ukraine’s
industrial plants more time to improve efficiency. Last week the government
told consumers that the price increases agreed to in January mean it will
cost them twice as much to heat their homes.

This week, Gazprom ratcheted up the rhetoric, complaining in a press release
that Ukraine wasn’t moving fast enough to build up reserves in its storage
facilities. Those reserves are critical to ensuring Gazprom can meet demand
from Europe during periods of peak demand in the winter. Europe gets about

a quarter of its gas from Russia.

Gazprom has long sought ownership of export infrastructure in Ukraine, but
Kiev has resisted turning over assets to Russia. Other former Soviet
countries have agreed to let Gazprom into their energy industries.     -30-
—————————————————————————————————
Write to Alan Cullison at alan.cullison@wsj.com

LINK: http://online.wsj.com/article/SB114956657127672378.html
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17.             RUSSIA-UKRAINE SHOWDOWN (REVISITED)
 
EUROLINKS DAILY VIEW: By FREDERICK KEMPE
The Wall Street Journal, New York, NY, Tuesday, June 6, 2006

Russia has a choice to make regarding Ukraine in the final weeks before it
chairs the July G-8 summit in St. Petersburg. Does it press for still-higher
natural-gas prices from Kiev when its current deal runs out at end-June? Or
will someone in the Kremlin be clever enough to avoid new controversy before
then?

Moscow and Kiev reached a tense truce after last New Year’s Russian gas
supply cutoff, but correspondent Alan Cullison reports that relations remain
rocky, and Russia is again seeking price increases from its neighbors. Even
Belarus, whose authoritarian leader is far from the Ukrainian pro-Western
course, faces demands that it double or triple its rates starting next year.

Moscow isn’t making ultimatums to Kiev of the sort that preceded the New
Year’s showdown, ultimately chilling relations with the West as well. Yet
the Kremlin ambassador to Ukraine Viktor Chernomyrdin said: “Where there are
bad political relations, good economic [affairs] just don’t happen.”
————————————————————————————————-
Write to Frederick Kempe at fred.kempe@wsj.com.

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18. RUSSIAN GAS BOSS REASSURES EUROPEAN CONSUMERS
   Says Ukraine lagging behind pumping gas into underground storage facilities

NTV Mir, Moscow, in Russian 1500 gmt 6 Jun 06;
Channel One Worldwide (for Europe), Moscow, in Russian 6 Jun 06
BBC Monitoring Service, United Kingdom, Tue, Jun 06, 2006

MOSCOW – The head of the Russian gas giant, Aleksey Miller, has reassured
European consumers by saying that Gazprom will honour its gas supply
contracts, Russian external TV service NTV Mir reported on 6 June.

At the World Gas Conference in Amsterdam, the chairman of the board of the
Gazprom open joint-stock company, Aleksey Miller, said: “I would like to say
once again that Europe can be confident that all the contracts that have
been signed by Gazprom will be fulfilled fully and in time.”

However, Miller warned European consumers that just like last winter there
could be problems next winter as well, because Ukrainian partners are
lagging behind with pumping gas into their underground storage facilities.

Miller said: “It is already possible to say now that it can be expected that
in the autumn-winter period of 2006-2007 Ukrainian underground gas storage
facilities will be short of the required volume of gas in the underground
gas storage facilities and Ukrainian consumers may experience a deficit of
supply.

And we do not, of course, want a repeat of the situations which already
existed in the past when there was an unauthorized withdrawal of Russian gas
from the export pipeline which goes through Ukrainian territory to European
consumers. We currently have all reasons to believe that because of the
current situation with pumping gas into underground gas storage facilities,
gas deficit in Ukraine in the next autumn-winter period may amount to
several billion cubic metres of gas.”

Summing up Miller’s statements, Russian Channel One Europe TV said in its
1700-gmt news bulletin that the Ukrainian side provides insufficient
information about its stockpiles of gas. Channel One correspondent Anatoliy
Lazarev said Miller personally went to the stand of the Naftohaz Ukrayiny
company to discuss the situation. To Miller’s question as to how
preparations for the winter are going on, the deputy chairman of the board
of the Naftohaz Ukrayiny company, Bohdan Klyuk, said: “preparation stinks”.

Miller agreed with Klyuk and said: “Well, ‘stinks’ is the right assessment”.

Klyuk continued by providing some details: “We have a shortfall of 2bn [cu.
m.] and I believe that we now need to seriously get down to the negotiating
table”.

Miller replied to this by saying: “Of course, but the situation that has now
come about regarding underground storage facilities – the question of
non-payments comes in addition to it. The debt has already reached nearly
600m dollars. Both you and us understand that the situation is critical and
volumes of pumping should be increased. You should put this question
urgently at the government level. And without doubt the figures which can
currently be seen regarding the deficit, they are very large figures.”

The Channel One correspondent then commented by saying that “Ukrainian

gas officials lamented that apart from everything else, constant political
storms in the country’s leadership hinder their efforts to settle the
situation”.

He rounded up his report by saying: “The energy security of many European
countries can once again be threatened because of just one weak link in the
system.”                                          -30-
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19.     RUSSIA AND WEST APPEAR SET TO CLASH OVER UKRAINE
Will Moscow demand Ukrainian infrastructure as price of integration with the West?

ANALYSIS & COMMENTARY: Igor Torbakov
Eurasia Daily Monitor, Volume 3, Issue 112
Jamestown Foundation, Wash D.C., Friday, June 9, 2006

The Kremlin and the West have ratcheted up their rhetoric over NATO’s
possible expansion into Ukraine. The strategically located East European
state appears destined to remain an apple of discord between an increasingly
assertive Moscow and the Western powers. At stake are the intertwined issues
of identity, geopolitics, and energy security.

The title of the international conference organized this week by the
Vienna-based Osterreichisches Institut fur Internationale Politik — “The
Battle for Ukraine” — seems to neatly encapsulate the nature of the brewing
geopolitical standoff.

On June 7, Russian Foreign Minister Sergei Lavrov told the State Duma that
NATO membership for Ukraine or Georgia would lead to a “colossal” shift in
the global geopolitical balance. Moscow, the top Russian diplomat added,
would evaluate all possible consequences “first and foremost” from the point
of view of the national interests of Russia.

For its part, the Duma the same day overwhelmingly approved a “message” to
the Verkhovna Rada, Ukraine’s parliament, expressing the “serious concern”
of the Russian legislature at Kyiv’s goal of joining the Western alliance.
According to the message, Ukraine’s drive to join the North Atlantic Treaty
Organization is a violation of a 1997 Russia-Ukraine treaty that outlines
the “strategic nature” of Russian-Ukrainian relations and, if fulfilled,
“would have negative consequences for the entire range of relations between
our two fraternal peoples.”

The statement specifically noted that “close interregional relations unite
[Russia] with the Autonomous Republic of Crimea,” where pro-Russian forces
have been blocking preparations for joint Ukrainian-U.S. military exercises.

Russia’s clear intent to step up pressure on Kyiv did not pass unnoticed by
Western policymakers. NATO Parliamentary Assembly President Pierre Lellouche
slammed the statement by the Russian foreign minister. Lellouche told the
BBC’s Ukrainian service that Lavrov’s assertion reflected a contradictory
position. Indeed, the NATO-Russia agreement of 1997 recognized the right of
each European country to choose its allies and decide which organizations to
join.

It was no novelty for the West that Russia is against NATO’s eastward
expansion. But it was unclear, the NATO officials say, how Russia could seek
to prevent Ukraine and Georgia from joining NATO without resorting to Cold
War methods. Lellouche argued that it would be impossible to build another
empire within the borders of the former Soviet Union but noted that it is
exactly the emergence of such an empire that would mark a true geopolitical
shift.

The Western wariness of Russia’s strategic designs is well understood.
However, one has also to clearly understand why Moscow feels it is the right
moment to launch a massive offensive on the Ukrainian front. It is important
to remember that the bulk of the Russian policy elite never believed that
Ukraine’s pro-Western course was firmly sealed with the 2004 Orange
coalition electoral victory. Most Russian policymakers and analysts always
warned there would be a second round of struggle over Kyiv’s geopolitical
orientation.

It is the continuous indecision of Ukraine’s President Viktor Yushchenko and
the endless haggling over the government portfolios among the hapless
partners within the Orange camp that resulted in the current situation
whereby Ukraine lacks a properly functioning parliament, a viable
government, and an operational Constitutional Court. The institutional
weakness created by Kyiv’s flawed domestic policies simply invited the
Kremlin strategists to launch their all-out attack.

Russia has a two-pronged strategy in Ukraine. Its first aim is to discredit
the Orange politicians in the eyes of the West. By actively supporting the
massive anti-NATO rallies in Ukraine’s eastern and southern regions, Moscow
is fanning the inner divisions within Ukrainian society. Russia seeks to
portray its Slavic neighbor as a badly split, geopolitically confused, and
thus inherently unstable nation.

As the majority of Ukrainians negatively view the prospect of their
country’s joining the Atlantic alliance, Russian pundits argue, further
confrontation is inevitable — a development that would only aggravate the
existing divide between the supporters and the opponents of integration with
the West.

If the United States and the European Union continue to encourage official
Kyiv’s pro-Western proclivities, in particular, its Euro-Atlantic
aspirations, one Russian policy paper asserted recently, the result would
likely be the emergence of a new “arc of instability” along the
Russo-Ukrainian border. If this comes to pass, the paper adds, it will be
the end of the alliance of global powers against new threats — including
Russia’s cooperation with the West in the war against terror.

Second, the Kremlin wants to maximally strengthen the hand of the political
forces within Ukraine that it believes are Russia’s strategic allies. If
they manage to impose their scenario of a coalition government on a
politically enfeebled Yushchenko, Moscow’s geopolitical interests would be
much better protected.

Remarkably, at the heart of the Kremlin’s strategic concerns are the
interests of Russia’s major energy monopolies, starting with Gazprom. It
cannot be a mere coincidence that this week Gazprom managers raised the
issue of a possible price increase for the natural gas Ukraine receives from
Russia: the compromise reached between Moscow and Kyiv in January
expires at the end of June.

Price hikes for the former Soviet republics are Gazprom’s weapon of choice
to penetrate neighboring countries’ energy industries. Gazprom has long eyed
Ukraine’s export infrastructure, but so far Kyiv has been adamant in its
reluctance to cede valuable assets to Russia’s energy giant.

The issue of energy security appears to be intimately linked with Ukraine’s
possible membership in NATO and will likely be at the epicenter of the
ongoing geopolitical tug-of-war over Ukraine between Russia and the West.

According to one high-profile Western analyst, if Ukraine hands over control
of its network of oil and gas pipelines or loses ownership of this network,
the Western allies will be very concerned. They might question Ukraine’s
ability to defend its primary interests, the Western pundit argues, since
the oil and gas systems are a guarantee of Ukraine’s independence.
——————————————————————————————————
(Kyiv Post, June 8; RIA-Novosti, Interfax, Standard, June 7; Rossiiskaya
gazeta, Day Weekly Digest, June 6) (http://www.jamestown.org
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20. BUSH TO MARK ANNIVERSARY OF HUNGARIAN REVOLUTION
       Trip to Kiev put aside because a new government has not been formed

Associated Press (AP), Washington, D.C., Thursday, June 8, 2006

WASHINGTON – President George W. Bush, in a last-minute schedule

change, will travel to Budapest this month to mark the 50th anniversary of
the Hungarian revolution. The visit will come after a stop in Vienna on June
20-21 for a summit with European Union leaders.

Bush originally had planned to travel from Austria to Kiev, Ukraine, but
that was put aside because of Ukraine’s difficulty in forming a new
government. The Kiev visit was never officially announced by the White

House although officials had talked privately about Bush stopping there.

In a statement announcing the visit, the White House said, “Hungary is a
close NATO ally, sharing its experiences with emerging democracies and
committed to the war on terror. Hungary has made important contributions in
support of democracy and security in the Balkans, Afghanistan, and Iraq.”

It said Bush would hold talks on June 22 with President Laszlo Solyom and
Prime Minister Ferenc Gyurcsany.                       -30-
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21. PRES BUSH TO VISIT HUNGARY JUNE 22, KIEV LATER 

Agence France Presse, Washington, D.C., Thu, June 8, 2006

WASHINGTON – President George W. Bush will visit Hungary on June 22

for events marking the 50th anniversary of the 1956 Hungarian uprising against
Soviet domination, the White House said.

But he has postponed unofficial plans to visit Ukraine as part of the same
trip that will take him to Vienna June 21 for the annual US-Europe summit.

“The president will be going to Kiev. We’ve just postponed the trip. There
will be a trip, but we’re going to go to Budapest. I mean, this wasn’t a
good time and we’re going to find a better time,” said Bush spokesman Tony
Snow.

The White House had been considering a stop in Ukraine, which has failed to
form a government following March elections, but had not formally announced
such a visit. Russia has been closely watching Kiev’s outreach to the West.

In Hungary, Bush will hold talks on trans-Atlantic relations, fighting
terrorism, and promoting democracy with Hungarian President Laszlo Solyom
and Prime Minister Ferenc Gyurcsany, said Snow.

“Hungary is a close NATO ally, sharing its experiences with emerging
democracies and committed to the war on terror. Hungary has made important
contributions in support of democracy and security in the Balkans,
Afghanistan, and Iraq,” said Snow.

“In Budapest, the president will celebrate Hungary’s historic sacrifices in
the name of freedom by commemorating the 50th anniversary of the 1956
Hungarian Revolution, underscore the success of the US-European partnership
in securing freedom in the region, and highlight the lessons offered from
Hungary’s successful transition from tyranny to free-market democracy,” said
Snow.                                                     -30-

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22. A NATION UNITES FOR UKRAINE DEBUT IN WORLD CUP

By Kevin O’Flynn, Staff Writer, Moscow Times
Moscow, Russia Wednesday, June 7, 2006. Issue 3427. Page 24.

Ukraine provided the biggest surprise of the European qualifying rounds,
being the first team from the continent to confirm its place at the World
Cup finals in Germany.

And with Chelsea’s new star Andriy Shevchenko heading a solid
counter-attacking unit, Ukraine is looking to do more than just make up the
numbers.

KIEV — Ukraine has waited a long time to make its mark in international
football. But come June 14th, the zhovto-blakitniye, or the
yellow-and-blues, will finally make their World Cup debut.

Andriy Shevchenko, one of the world’s top strikers who has just joined
Chelsea, will, if he recovers from injury, finally get the chance to play on
football’s biggest stage. And a nation – divided by language and politics –
will for a few weeks be united.

Ukraine’s journey to Germany has been a long one. After the Soviet Union
broke up in 1991, FIFA had only one space for the 1994 World Cup. It chose
Russia, much to many Ukrainians’ chagrin. The move meant that Ukraine lost a
generation of players and trainers who headed for the stronger Russian
league. Players like Andrei Kanchelskis and Victor Onopko, both born in
Ukraine, chose to play for Russia instead.

Though Shevchenko took Dynamo Kiev to the semifinals of the Champions

League in the 1990s, the Ukrainian national team continually failed to make it
to an international tournament, losing in three consecutive qualifying
tournament playoffs to Croatia, Slovenia, and then Germany.

It looked as if Shevchenko, European footballer of the year in 2004 and the
biggest star in post-Soviet football might never take part in an
international tournament.

It was only after Oleg Blokhin, the legendary Dynamo forward, returned from
coaching in Greece to take charge of Ukraine in 2003 that Ukraine finally
made it to an international tournament.

From the start, Blokhin said his side would come top of its group, despite
being drawn with European champion Greece, Turkey, semifinalist in the last
World Cup and Denmark. Many laughed but Blokhin managed to create a

team, relying on a tight defense and swift counterattacking.

A 3-0 win in Istanbul over Turkey built belief in the team that then proved
that it could win without Shevchenko when the injured striker missed the
game against Denmark, which Ukraine won with a goal from Bayer
Leverkusen’s Andriy Voronin.

Ukraine became the first team in Europe to qualify for the World Cup and
more than 70,000 people came out on to the Maidan, the biggest event since
the Orange Revolution, to celebrate.

This week, Ukrainian Prime Minister Yuri Yekhanurov asked firms to install
television sets in the workplace as the nation goes world cup mad.

“On June 14 at 4 p.m. we can expect an epidemic of unknown diseases.
Peoplewill call in sick en masse. We recommend all administrators install
televisions. Do what you can to make it possible for people to watch
football.” Ukrainian Prime Minister Yuriy Yekhanurov

In a nation in the midst of a political crisis and still divided after the
Orange Revolution, the team is one of the few things that unites the
country, said Savik Shuster, the host of Svoboda Slovo, a political debate
show on Ukrainian television and Trety Taim, a football show that will be
broadcast in Ukraine throughout the World Cup.

The Ukrainian side was sent off to Germany in an extravagant ceremony at the
Olympic Stadium on May 28th with cheerleaders and marching bands. Thirty
thousand fans turned up with signs such as “Blokhin ist Fantastisch” and the
sound of one of the team’s song, which urges the players that victory is
needed “so your mother’s eyes glow.”

Some are tipping Ukraine as the dark horse of the tournament as Greece was
in Euro 2004 — indeed, some would say their football is as uninspiring as
that of the Greeks. Drawn against Spain, Tunisia and Saudi Arabia, the
zhovto-blakitniye are favorites along with Spain to qualify for the second
round.

To have any chance, Ukraine needs Shevchenko back and the best from its
other quality players.

Shakhtar Donetsk captain Anatoliy Tymoshuk, a tough holding midfielder, has
the ability to be one of the stars at the tournament and the motivation as
he is set to leave his club and has set his eyes on joining Shevchenko in
the English Premier League.

Dynamo Kiev goalkeeper Olexander Shovkovskiy is back at his best after
injury. Serhiy Rebrov, Shevchenko’s attacking partner in the great Dynamo
Kiev side of the early 90s, has returned to form with Dynamo after five
frustrating years abroad in England and Turkey.

Voted player of the year in Ukraine, he will likely play, if he recovers
from a hip injury, just behind the front line in an attacking midfielder
role. Voronin will likely play up front with Shevchenko.

Ukraine’s biggest weakness is in defense. Its best defender, Serhiy Fyodorov
of Dynamo Kiev, withdrew from the squad after an injury in the last game of
season.

And the problem is particularly acute at right back, where Dynamo midfielder
Oleg Gusev has been forced to fill in.

The series of injuries has exposed the lack of depth in Ukrainian football
and the heavy reliance on Shevchenko. Blokhin complained that in the
Ukrainian league he has no more than 25 players to choose from because

the top clubs are dominated by foreign players.

Injuries meant that Blokhin could barely fill the bench for last week’s
friendly against Costa Rica.

“I’m dissatisfied that I only have 16 players,” said Blokhin at a news
conference before last week’s friendly with Costa Rica, which the Ukrainians
won 4-0. Four players have been called up from the under-21 side; four
players who almost became champions even before they arrived in Germany,

but lost 3-0 to Holland on Sunday in the final of the European Championships.

Seventy percent of Russians will support Ukraine in Germany, according to
opinion polls, but that figure is almost certainly lower amongst regular
football fans, for whom Ukraine has always been Russia’s biggest rival.

Fans’ web sites are full of jealous bad will towards the khokhly, the
insulting nickname that Ukrainians are sometimes called.

“I wish the khokhly good luck in bringing shame on themselves and letting
the Arabs get through instead of them,” wrote one fan on championat.ru,
whilst another wrote “Oh, if only Tunisia can f*** them up 5-0.”

The most galling result for many Russian fans will be if Ukraine gets
through to the playoff stages. It is after all a feat that has eluded Russia
in every major tournament it has appeared in.             -30-

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LINK: http://www.themoscowtimes.com/stories/2006/06/07/093.html
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23.     SOCCER: THE FUTURE’S BRIGHT FOR UKRAINE 
 
FIFAworldcup.com, Thursday, June 8, 2006

Andriy Pyatov, Oleksandr Iatsenko, Dmytro Chigrynskiy and Artem

Milevskiy are unlikely to forget May 2006 in a hurry.

After being called up to test themselves against the cream of Europe’s U-21
sides, the quartet were then unveiled as surprise inclusions in Oleg
Blokhin’s FIFA World CupT travelling party, receiving a unique chance to
defend their nation’s pride during their historic first appearance on the
world stage.

For this talented quartet, the first part of this adventure proved a
resounding success, as the future hopes of Ukrainian football exceeded all
expectations at the UEFA European U-21 Championship on Portuguese soil.
Owing their place to a play-off victory over Belgium, Ukraine entered the
competition with few illusions, but ten days later they claimed the
runners-up spot after losing 3-0 to the Netherlands in the final.

Chigrynskiy and Milevskiy, in particular, were viewed by some observers as
two of the stars of the tournament – no doubt to the delight of national
coach Oleg Blokhin. Last month Blokhin resembled a worried man when asked

to predict his team’s chances in Germany. “Unfortunately, we’re not in the best
of form,” explained the 1975 Ballon d’Or winner.

“Even if everything seems to be working pretty well in midfield and attack,
we have big problems in defence.” With that in mind, the emergence of
Chigrynskiy and Iatsenko as a possible central-defensive pairing must have
come as a huge relief.

The former may have contested little more than 20 professional matches, but
he is an undisputed pillar of the U-21 side. Watched closely by Blokhin over
the past few months, Chigrynskiy is a strong but precise tackler, who
committed just four fouls in five matches in Portugal.

Meanwhile, his partner Iatsenko, who captained Ukraine at last year’s FIFA
World Youth Championship, owes his berth in the squad to Serhiy Fyodorov’s
withdrawal. That said, Iatsenko has excelled both for his club FC Kharkiv
and the U-21 team since then, and fully deserved his first senior cap in the
1-0 triumph over Japan last October.

  MILEVSKIY, FOLLOWING IN SHEVCHENKO’S FOOTSTEPS
Blokhin’s defensive worries will also have been eased by the recent form of
Bogdan Shust and Pyatov, two promising young goalkeepers who look set to
ensure a smooth transition whenever Oleksandr Shovkovskiy eventually steps
down. Of the duo, the slightly-older Pyatov wore the No.1 jersey in
Portugal, but even though he was beaten three times in the final, he shone
brightly against the Dutch, following equally inspiring displays against
Italy, Denmark and Serbia and Montenegro.

Should Shovkovskiy fall victim to injury, as happened at the start of the
year, Pyatov has already proven himself to have the qualities required to
step into the breach.

Up front, the days of Ukraine’s over-dependence on Andriy Shevchenko could
be numbered. Oleg Gusev and Oleksiy Bielik both emerged with credit for the
senior side during the qualifiers, yet the hopes of an entire nation appear
to lie with Milevskiy.

Star striker for the U-21s, he left Portugal with two goals and two
man-of-the-match trophies to his name, and was sorely missed against the
Dutch after picking up an injury in the semi-finals. Tall, quick and blessed
with sublime technique, the Dynamo Kiev forward is already regarded by many
as the natural successor to ‘Sheva’.

Wednesday 14 June will be a groundbreaking day in Ukrainian football as they
take their first steps at a FIFA World Cup finals, but given the promise of
their up-and-coming stars, the country’s flag could well be seen hanging at
future editions for many years to come.

A seat on the bench may well be the likely starting place for the young
quartet against Spain, but they are unlikely to be complaining. After all,
with a trip to the FIFA World Cup finals following directly on from their
exploits for the country’s U-21 side, this summer seems to be shaping up
nicely.                                                 -30-

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LINK: http://fifaworldcup.yahoo.com/06/en/060608/1/77rx.html
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24. VOLYN UKRAINIAN SONG & DANCE CO STARTS CANADIAN TOUR
        Performance embodies the best Ukraine has to offer in the art of spectacular
                folkloric dance, song, and music. Volyn is the Spirit of Ukraine!

Abaze Productions, Toronto, Ontario, Canada, June 9, 2006

TORONTO – The long awaited 22-city Canadian Tour by the world-class
VOLYN UKRAINIAN SONG & DANCE COMPANY of Lutsk, Ukraine,
will premiere at the Grand Theatre in London, ON, on Tuesday, June 20, 2006.
The performance starts at 8:00 p.m.

During their 1999 North American Tour their performance was described by
The New York Times as “Flawless,” while the Chicago Tribune exclaimed
“Glorious!”

Northstreams Inc., a top Canadian production house will be filming the
live performance. This television special is destined for the PBS, SCN,
BRAVO and other television networks around the world.

Tickets at the Hummingbird Center for the Performing Arts in Toronto are
going fast and furious, with customers snapping up the best seats. It is
projected that the Toronto performance on Saturday, June 24, at 8:00
p.m. will soon be sold out. Sales in other cities are going well.

Judging by the standing ovations, laudatory press reviews, and the
numerous compliments from patrons, the entertainment quality is superb!

From song to dance, and back again, the entire team on the stage keeps
us entertained, amused, and tapping our toes or clapping our hands.  The
well trained professional singers and disciplined dancers mix happily
with the peppy musicians in a congenial “neighbourly” way with a
Hollywood touch!   This is a world-class ensemble!

The Volyn Ukrainian Song & Dance Company is Ukraine’s premiere
goodwill ambassador to Canada.  Their performance embodies the best
Ukraine has to offer in the art of spectacular folkloric dance, song, and
music. Volyn is the Spirit of Ukraine!

Performances in Ontario will be held in:
[1] HAMILTON, ON; Wednesday, June 21 @ 8:00 pm
Hamilton Place, Tickets: By phone: 905-546-4040
http://www.ticketmaster.ca/

[2] WINDSOR, ON: Thursday June 22 @ 8:00 pm
Chrysler Theatre, Tickets: By phone: 519-252-6579
Toll free: 1-800-387-9181; In Michigan: 248-645-6666
On Line: http://www.ticketmaster.ca/
OR http://www.ticketmaster.com/

[3] TORONTO, ON: Saturday, June 24, 2006 @ 8:00 p.m.
Hummingbird Centre: Tickets: Box Office 416-872-2262
On line: http://www.ticketmaster.ca/
West Arka: 416-762-8751; Euro Deli:  905-290-0605

[4] OTTAWA, ON: Sunday, June 25 @ 3:00 p.m.
National Arts Centre: Tickets: Box Office 613-755-1111
On line: http://www.ticketmaster.ca/
By fax: 613-947-7112

[5] SUDBURY, ON: Wednesday, June 28 2006 @ 8:00 pm
Fraser Theatre, Tickets: By phone: 705-674-8381

Performances in other Canadian cities will be announced shortly!

To view a 12 minute video clip or hear the Volyn Ukrainian  Song & Dance
Company music or listen to the interviews, please CLICK onto the  LINK
below: http://www.ablaze-productions.com/Tour06/index.html

The sponsors of the Canadian Tour 2006 are:
Aerosvit Ukrainian Airline, OMNI Television, e-POSHTA, Caravan
Logistics, Multiculture Marketing,  Meest Ukrainian Weekly,
http://www.kviten.com/, and VISTACOM Media & Graphics

This is a presentation of Ablaze Productions in association with the
Volyn Oblast Administration of Ukraine, the Rt. Hon. Volodymyr N.
Bondar, Governor.                       -30-
———————————————————————————————-
For additional information contact:  Leonid (Leo) Oleksiuk, President
& CEO, Ablaze Productions Corp., 2323 Lakeshore Blvd., West Suite
911, Toronto, Ontario Canada, M8B 1B8; Tel.  416-521-9555;
Cell: 416-276-2872; E-mail: leo@ablaze-productions
Web: www.ablaze-productions.com
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25. PRES YUSHCHENKO VISITS UKRAINIAN ART EXHIBITION

                IN AMSTERDAM’S NIEUWE KERK MUSEUM

Press office of President Victor Yushchenko
Kyiv, Ukraine, Thursday, June, 8, 2006

KYIV – Victor Yushchenko and Dutch Princess Margaret have visited an
exhibition of Ukrainian art in Amsterdam’s Nieuwe Kerk Museum. In his
speech, the Head of State said art “has always been one of Ukraine’s best
features.”

“It is quite symbolic to see Ukrainian masterpieces exhibited in the
Netherlands, the country that is famous for its Flemish style,” he said. Mr.
Yushchenko characterized the exhibition as “another manifestation of the
multifaceted nature of Ukrainian-Dutch relations.” The President then spoke
with the curators and visitors of the exhibition.

De Nieuwe Kerk (The New Church) is now showing paintings and

watercolours by the best-known Ukrainian artists of the 19th century and
early 20th century.
Among the highlights are the works of Repin, Murashko and Levchenko and
the monumental work “The Bride” by Krychevsky.

The exhibition has been made possible by the Founders of the Nieuwe Kerk,
Fortis Bank and Buhrmann NV, and the chief sponsors, Getronics PinkRoccade
and KPMG, and is a co-production with the Dutch Ministry of Foreign Affairs.

De Nieuwe Kerk in Amsterdam is famous for its much talked-about exhibitions.
With hundred thousands of visitors every year, the church is one of the most
attended exhibition locations in the Netherlands.                -30-
——————————————————————————————————
LINK: http://www.president.gov.ua/en/news/data/1_8820.html

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26. UKRAINE’S FIRST LADY VISITS NETHERLANDS, MEETS WITH
      DUTCH HUMANITARIAN AND CHARITABLE ORGANIZATIONS

Press office of President Victor Yushchenko
Kyiv, Ukraine, Thursday, June 8, 2006

KYIV – Kateryna Yushchenko accompanied her husband in the Kingdom
of the Netherlands. On June 7, the First Lady met with the wife of the Dutch
Premier, Bianca Balkenende, in the Mauritshuis Royal Art Museum.

Mrs. Yushchenko told Mrs. Balkenende what her charitable foundation,
Ukraine 3000, did and what programs it carried out. They also discussed
areas of future cultural cooperation between Ukraine and the Netherlands.

On June 8, she visited the city of Vlaardingen to meet with representatives
of Dutch humanitarian and charitable organizations, as well as Ukrainians
residing in the Netherlands. She was welcomed by Agnes van Ardenne-van der
Hoeven, Minister for Development Cooperation, Tjerk Bruinsma, Mayor of
Vlaardingen, and his wife.

Mrs. Yushchenko was also saluted by children waving Ukrainian flags. They
represented Stichting Spoetnik, which has been cooperating with Ukraine for
many years. Beja Kluiters, the Head of this charitable organization,
attended the meeting.

In her speech, the President’s wife thanked those present for hospitality.
She also expressed gratitude to the Netherlands for supporting health care
in Ukraine. She outlined major programs of her foundation and thanked
Stichting Spoetnik for contributing to the development of Ukrainian-Dutch
relations. Ukraine’s Health Minister Yuriy Polyachenko read out a decree to
decorate Ms. Kluiters with the State Order of Saint Olga.

Then the First Lady visited the Vlietland Hospital. She met with its head
doctors to speak about her foundation and its efforts to improve health care
for children in Ukraine.                        -30-

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LINK: http://www.president.gov.ua/en/news/data/5_8840.html
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27. NEW BOOK PUBLISHED FEATURING CREATIVE WORKS BY
        UKRAINIAN-AMERICAN ARTIST ANATOLE KOLOMAYETS

Action Ukraine Report (AUR) #709, Article 27
Kyiv, Ukraine, Friday, June 9, 2006

KYIV – A coffee table book featuring 50 years of creative works by
Ukrainian-America artist Anatole Kolomayets was published late last year
by Sophia-A, an art books publishing house in Kyiv, which has produced
a series of books titled “Testimonies of  Spirit,” dedicated to Ukrainian
artists beyond the borders of Ukraine.

The hardcover 148-page monograph, simply titled “Anatole Kolomayets”
catalogs more than 140 color reproductions of the artist’s oil paintings,
spanning five decades, but highlighting works from his later career. All of
the paintings are identified by title and size, tagged by their year of
creation and to whose collection they belong, making this a wonderful
keepsake gift for those who have followed the artist’s evolution.

The book, released as a bilingual publication in both Ukrainian and English,
features a number of articles, essays and reviews by the artist and his
critics.  The print run of 1,000 copies, will be distributed in art
libraries and museums in the United States, Canada, Europe and Ukraine
and is available for sale to individuals as well as in gift shops and
bookstores.

In his opening remarks, the late Mykola Marychevskyy, a prominent art critic
and editor of   art journals, who died in October 2005, wrote: “The creative
works of Anatole Kolomayets synthesize what he has acquired and what he
has inherited. His artistic skills and sense of color are the generous gifts
of his native land. And his training in Western Europe allowed him to hone

his professional skills at he very heart of he movement toward modern art
trends.”

Kolomayets was born in the Poltava region of Ukraine in 1927. He studied St.
Luke’s Institute (1948-52) and the Royal Academy of Fine Arts (1952-53),
both in Liege, Belgium, where he polished his professional skills, formed
his own individual artistic preferences and made his personal discoveries in
creativity.

After graduate studies, he immigrated to Chicago, which he has called home
for more than half a century.  Here, he married Lubomyra Karawan and
together, they had two children, Marta and Andrew.  The artist dedicates his
book to his family.

More than 400 of the artist’s works are in numerous private collections and
galleries in Argentina, Australia, Belgium, France, Great Britain, the
United States, Canada and Ukraine. Although most of his works are in oils,
and this book is devoted to that medium, Kolomayets also works with
watercolors and in pencil.

He has had one-man shows in Chicago, Detroit, Cleveland, Washington, D.C.,
Philadelphia, Toronto, New York, Los Angeles and Denver. He is planning to
exhibit his art works in Ukraine in 2007.

In a lengthy review, analyzing 50 years of Kolomayets’ work, art critic
Andriy Hurenko writes: “If it is true that art is a reflection of the
artist’s nature, then the human qualities of Anatole Kolomayets are brilliantly

shown in his canvases. Looking at the accumulation of more than half a
century of creative work, it is possible to put together a portrait of the artist’s
personality.

He is a man of principle who has the courage ‘to always step out of the
mainstream’ (Bohdan Rubchak). He is reserved and, at the same time, his
is a subtle, unimposing spiritual approach. He is a thorough and highly
professional painter who is not prepared to distort his image for the sake
of fashion. There is no spiritual stress or strain in him.

He exploits neither horror, nor brutal violence, nor ostentatious subjects
for the sake of easy popularity. The themes of his paintings reflect an
established set of preferences and at the same time a sincere interest in
life in all its forms and manifestations.  Yet it is the human dimension
that interests this artist most.”

Kolomayets also spends time reflecting on his journey as an artist.  The
publications includes his remarks at his personal exhibit marking 50 years
of artistic work, held at the Ukrainian National Museum in Chicago in
November, 2003:  ” The artist not only creates art, but also lives by what
he creates.

To bring out the best in human nature, we need more free time and we need
to break up that time so that we can benefit from the achievements of the
civilized world, to enrich our lives. Instead people just rush through life,
never leaving their mark in this wonderful, boundless world.

“I remember it as if it happened today. It was a wonderful sunny day and the
sun stood high in the sky as I walked out through the open doors of the
academy, lightly holding tow diplomas in my left hand.  I looked up at the
sun and thought: what’s next. That was exactly 50 years ago.”

The book is available from the artist for $25, plus $5 for shipping and
handling (total cost is $30) by ordering from Anatole Kolomayets, 6819 N.
Algonquin Ave., Chicago, IL 60646.                  -30-
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         “ACTION UKRAINE REPORT – AUR”
         A Free, Not-For-Profit, Independent, Public Service Newsletter
                With major support from The Bleyzer Foundation
 
      Articles are Distributed For Information, Research, Education
                Academic, Discussion and Personal Purposes Only
                                  Additional readers are welcome.
========================================================
      SigmaBleyzer/The Bleyzer Foundation Economic Reports
                “SigmaBleyzer – Where Opportunities Emerge”
 
The SigmaBleyzer Emerging Markets Private Equity Investment Group
and The Bleyzer Foundation offers a comprehensive collection of documents,
reports and presentations published by its business units and organizations.
 
All publications are grouped by categories: Marketing; Economic Country
Reports; Presentations; Ukrainian Equity Guide; Monthly Macroeconomic
Situation Reports (Romania, Bulgaria, Ukraine).
 
You can be on an e-mail distribution list to receive automatically, on a
monthly basis, any or all of the Macroeconomic Situation Reports (Romania,
Bulgaria, Ukraine) by sending an e-mail to mwilliams@SigmaBleyzer.com.
               “UKRAINE – A COUNTRY OF NEW OPPORTUNITIES”
========================================================
   UKRAINE INFORMATION WEBSITE: http://www.ArtUkraine.com
========================================================
    “WELCOME TO UKRAINE”- “NARODNE MYSTETSTVO”

              (Folk Art) and ContempoARTukraine MAGAZINES
For information on how to subscribe to the “Welcome to Ukraine” magazine
in English, Ukrainian Folk Art magazine “Narodne Mystetstvo” in Ukrainian, 
or ContempoARTukraine in English please send an e-mail to
ArtUkraine.com@starpower.net. Complete information can be found at
========================================================
              ACTION UKRAINE PROGRAM – SPONSORS
                              Action Ukraine Report (AUR)
               Holodomor Art and Graphics Collection & Exhibitions
          “Working to Secure & Enhance Ukraine’s Democratic Future”

1.  THE BLEYZER FOUNDATION, Dr. Edilberto Segura, Chairman;
Victor Gekker, Executive Director, Kyiv, Ukraine; Washington, D.C.,
http://www.bleyzerfoundation.com.
   Additional supporting sponsors for the Action Ukraine Program are:
2. UKRAINIAN FEDERATION OF AMERICA (UFA), Zenia Chernyk,
Chairperson; Vera M. Andryczyk, President; Huntingdon Valley,
Pennsylvania
3. KIEV-ATLANTIC GROUP, David and Tamara Sweere, Daniel
Sweere, Kyiv and Myronivka, Ukraine, 380 44 298 7275 in Kyiv,
kau@ukrnet.net
4.  ESTRON CORPORATION, Grain Export Terminal Facility &
Oilseed Crushing Plant, Ilvichevsk, Ukraine
5. Law firm UKRAINIAN LEGAL GROUP, Irina Paliashvili, President;
Kiev and Washington, general@rulg.com, www.rulg.com.
6. BAHRIANY FOUNDATION, INC., Dr. Anatol Lysyj, Chairman,
Minneapolis, Minnesota
7. VOLIA SOFTWARE, Software to Fit Your Business, Source your
IT work in Ukraine. Contact: Yuriy Sivitsky, Vice President, Marketing,
Kyiv, Ukraine, yuriy.sivitsky@softline.kiev.ua; Volia Software website:
http://www.volia-software.com/ or Bill Hunter, CEO Volia Software,
Houston, TX  77024; bill.hunter@volia-software.com.
8. ODUM– Association of American Youth of Ukrainian Descent,
Minnesota Chapter, Natalia Yarr, Chairperson
9. UKRAINE-U.S. BUSINESS COUNCIL, Washington, D.C.,
Dr. Susanne Lotarski, President/CEO; E. Morgan Williams,
SigmaBleyzer, Chairman, Executive Committee, Board of Directors;
John Stephens, Cape Point Capital, Secretary/Treasurer
10. UKRAINIAN ORTHODOX CHURCH OF THE USA, South
Brown Brook, New Jersey, http://www.uocofusa.org
11. UKRAINIAN AMERICAN COORDINATING COUNCIL (UACC),
Ihor Gawdiak, President, Washington, D.C., New York, New York
12. U.S.-UKRAINE FOUNDATION (USUF), Nadia Komarnyckyj
McConnell, President; John Kun, Vice President/COO; Vera
Andruskiw, CPP Wash Project Director, Washington, D.C.; Markian
Bilynskyj, VP/Director of Field Operations; Marta Kolomayets, CPP
Kyiv Project Director, Kyiv, Ukraine. Web: http://www.USUkraine.org
13. WJ GROUP of Ag Companies, Kyiv, Ukraine, David Holpert, Chief
Financial Officer, Chicago, IL; http://www.wjgrain.com/en/links/index.html
14. EUGENIA SAKEVYCH DALLAS, Author, “One Woman, Five
Lives, Five Countries,” ‘Her life’s journey begins with the 1932-1933
genocidal famine in Ukraine.’ Hollywood, CA, www.eugeniadallas.com.
15. ALEX AND HELEN WOSKOB, College Station, Pennsylvania
16. SWIFT FOUNDATION, San Luis Obispo, California
========================================================
 TO BE ON OR OFF THE FREE AUR DISTRIBUTION LIST
If you would like to read the ACTION UKRAINE REPORT- AUR,
around five times a week, please send your name, country of residence,
and e-mail contact information to morganw@patriot.net. Information about
your occupation and your interest in Ukraine is also appreciated. If you do
not wish to read the ACTION UKRAINE REPORT please contact us
immediately by e-mail to morganw@patriot.net.  If you are receiving more
than one copy please let us know so this can be corrected. 
========================================================
                        PUBLISHER AND EDITOR – AUR
Mr. E. Morgan Williams, Director, Government Affairs
Washington Office, SigmaBleyzer
Emerging Markets Private Equity Investment Group
P.O. Box 2607, Washington, D.C. 20013, Tel: 202 437 4707
Mobile in Kyiv: 8 050 689 2874
mwilliams@SigmaBleyzer.com; www.SigmaBleyzer.com
========================================================
    Power Corrupts and Absolute Power Corrupts Absolutely. 
========================================================
return to index [Action Ukraine Report (AUR) Monitoring Service]
========================================================
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