Shell and Ukrgasdobycha to Terminate Agreement on Ukraine Play

Royal Dutch Shell and the Ukrgasdobycha subsidiary of Ukraine's Naftogaz, have announced work on a hydrocarbon exploration project in Kharkiv region has concluded without success.

In a press release on its website,  Shell said that the joint venture had completed all exploration activities in Belyaevskaya-400 and New Mechebylivska 100 in the Pervomajskiy and Bliznyukovsky districts. Two wells were drilled and based on the results of exploration, the parties agreed that the follow-up project is not economically viable and agreed solution to the termination of the contract.

Shell also made reference to its activities at the Yuzivska (Yuzovsky) site where the company declared "force majeure" due to the military situation.  In January, 2013, Shell, along with Nadra Yuzivska, LLC and the Ukrainian government, signed a production-sharing agreement for the exploration, development, and extraction of hydrocarbons from the Yuzivska site (8,000 sq. km), a geological formation located in the Kharkiv and Donetsk regions.  Shell stated that it will continue to do all the work that can be done safely, for example, some of the collection and analysis of geological data, collaboration with universities, social investment projects.