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Ukrainian President Poroshenko sacks oligarch from key governorship post

President Petro Poroshenko says he's accepted the resignation of a billionaire oligarch from a key governor's post. Kyiv has asked for continued loyalty of the deposed tycoon's personal militia.

Ukraine's President Petro Poroshenko dismissed a regional governor on Wednesday in a move that could pit the power of Ukraine's central state against a powerful tycoon.

Kyiv is working to dilute the influence of oligarchs as it attempts to reassert its authorities even as its fighting continues with pro-Russian separatists in the east.

But Wednesday's action opens a new front in the Ukrainian crisis as Dnipropetrovsk regional governor Ihor Kolomoiskiy also commanded a private militia that has maintain a defense line against separatists in neighboring Donetsk province.

Poroshenko said his decision to relieve Kolomoiskiy must not alter loyalties in the region.

"We have to maintain peace, stability and calm. Dnipropetrovsk must remain a bastion of Ukraine in the east to defend the peace and calm of its citizens." Poroshenko said in the statement.

The dispute came to a head last week after armed men suspected to be under Kolomoiskiy's orders stormed the headquarters of the Ukrnafta energy firm in a two-day armed standoff that ended peacefully Tuesday.

Kolomoiskiy's Privat Group owns 43 percent of Ukrnafta. The dispute followed Kyiv's parliament's passing a law that increases the state's control over public companies and weakening Kolomoiskiy's de facto control of the country's largest oil and gas producer.

Igor Kolomojskyj

Kolomoysky is thought to be worth about 2.2 billion euros

Estimated to be worth as much as 2.2 billion euros ($2.4 billion), Kolomoiskiy is believed to have been incensed by the sacking of UkrTransNafta's chief executive Oleksandr Lazorko who had been the 52-year-old businessman's ally.

Banking billionaire Kolomoiskiy was appointed to the post following the ouster of Viktor Yanukovych, who fled to Russia last year.

That region has so far been an island of calm as fighting rages between Russia-backed separatists and pro-Kyiv militias and Ukrainian regular soldiers in adjoining provinces.

Kolomoiskiy is a controversial figure in Ukraine. He's been criticized for using heavy-handed tactics in business - on display this past week - but also committed to protecting Ukraine from being pulled apart by separatists.

jar/sms (AP, AFP)