KIEV, Ukraine (AP) _ Ukrainian President Leonid Kuchma refused to sign a law banning the creation of a single state oil and gas company, the president's press service said Wednesday.

Kuchma said the legislation would hurt the economy and urged parliament to cancel it.

The law, adopted by parliament last month, would prohibit the government from transferring its stakes in gas and oil companies to the new company, Naftogaz Ukrainy.

Kuchma created Naftogaz Ukrainy earlier this year. The company was to be formed by uniting state-owned companies, and transferring to it the stakes the government holds in other partially privatized gas and oil enterprises.

Naftogaz Ukrainy was to take charge of the national gas and oil pipeline network, estimated to be worth billions of dollars.

The creation of Naftogaz Ukrainy was seen as an attempt to find a way to privatize Ukraine's gas and oil companies, most of which parliament banned from privatization in 1995.

A number of Western firms have expressed interest in Ukraine's gas and oil sector but have run into opposition from parliament, which has a large share of Communist and other hard-line lawmakers.