Ukraine Targets Shale Gas Production by 2015

Ukraine is seeking to produce 4 to 5 billion cubic metres (bcm) of shale gas per year by 2020.

Vadim Chuprun, Deputy Chairman of the Board of Ukraine’s state energy firm Naftogaz Ukrainy, wants to speed up exploration of its large shale gas deposits to ease dependence on imports of Russian gas.

"Our first and most important aim is to ease our dependence on our only supplier," said Chuprun.

"We will need four years to get the first commercial shale gas. It means the year of 2015. But the terms could be reduced."

Ukraine is in joint venture talks with ExxonMobil, Shell, Chevron, Halliburton and other companies to gain access to expertise, technology and to participate in cost of developing shale gas resources, estimated to require billions of dollars.

Naftogaz and ExxonMobil signed a agreement in September for cooperation in the development of gas from unconventional sources.

The agreement envisages cooperation in the sphere of exploration and development of shale gas, tight sandstone gas and coal-bed methane with a focus on Ukraine’s western provinces and the Dnieper-Donets depression.

The deal followed an earlier agreement in June between TNK-BP Ltd. and Ukraine.

TNK-BP plans to invest $1.8 billion in unconventional gas projects in Ukraine over the next six to seven years, allowing for production of up to 3 billion cubic meters of gas a year.

Ukraine plans increase domestic natural and shale gas production to 28 bcm from the current level of 20 bcm and import 10 bcm of LNG by 2017.