Solutions from Ukraine: Ukraine launches wartime pilot project to build underground fuel storage facilities
Minimum reserves of oil and petroleum products must remain available for use even during martial law and other crises. At the same time, storing such reserves requires a sufficient level of physical security to reduce the risk of their destruction or loss.
The government also names the prevention of risks of damage to and loss of petroleum products during martial law in Ukraine as another objective. The pilot project should enable the use of underground storage facilities specifically for minimum reserves of oil and petroleum products and create a distributed system for such storage.
Cabinet of Ministers Resolution No. 1037 of August 13, 2026, refers to the "implementation of a pilot project to introduce underground storage of petroleum products from the minimum reserves of oil and petroleum products under the legal regime of martial law."
According to the document, the pilot project will continue for the duration of martial law, but no longer than two years from the date the resolution enters into force. It provides for the underground storage of petroleum products, including the minimum reserves of oil and petroleum products.
The resolution names Ukraine's Ministry of Energy as the coordinator of the pilot project. At the same time, the joint-stock company Ukrtransnafta will act as the "specialized responsible storage operator."
Under the procedure for the pilot project, it aims to:
Underground petroleum product storage facilities may take part in the pilot project if they:
Overall, under the approved procedure, the project provides for the creation of a distributed system of underground storage facilities for minimum reserves of oil and petroleum products.
The document defines an underground petroleum product storage facility as "a set of tanks, pipelines, engineering equipment, and other related elements located below the ground surface and intended for the storage of oil or petroleum products."
This refers to a technological complex created:
A key requirement for the fuel market will take effect in 2027, "from the beginning of the third base year."
Market participants and operators will have to store at least 20% of the total volume of diesel fuel underground, based on the total volume of this petroleum product included in the minimum reserves of oil and petroleum products.
At the same time, Ukrtransnafta must agree on the projected commissioning timelines for the storage facilities and the estimates for their reconstruction with the Energy Ministry within two months of the resolution entering into force.
All project participants must:
The project will be financed with participants' own funds and other sources not prohibited by law, including the state budget.
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29 of August 2026
