TNK-BP Discusses Shale Gas in Ukraine

Earlier this month Russia's third largest oil firm, TNK-BP, announced plans to start shale gas exploration in Ukraine.  (Read More HERE)

This follows last October's memorandum between TNK-BP and the Ukrainian government, allowing for the company to explore for shale gas in Ukraine's eastern Donetsk region.

In an interview with Ukrainian Energy, Felix Lunev, Managing Director TNK-BP Ukraine discussed the companies interest in shale gas in Ukraine.

Lunev said that given the access to the world class technology BP has, TNK-BP had been looking at developing shale gas in Ukraine for some time.

"Actions from our competitors, in a good sense of the word, forced us to move forward," he commented further.

"We are planning to implement the projects in Donets and Lugansk area, we have already signed memorandum with local authorities. In accordance with the signed memorandum, in case of a success of the project, we guarantee to create workplaces , certain infrastructure, guarantee to follow high environmental standards."

Lunev said that Ukrainian authorities have  promised to assist with developing the necessary legislation for licencing the exploration and production of the shale gas.

The company is taking a long term view of the project with a potential investment of USD1.5 billion over a 10-15 year time frame.

"The work program is for 20, even 30 years. For example, it will take a year to drill the first well. That is way it is too early to talk about the results."

TNK-BK hopes to receive the required licences in the first quarter 2011 that would allow it to start drilling shortly afterwards.

Read the Full Article at Ukrainian Energy HERE