Ukraine seems interested in developing own shale gas resources as a diversification from predominant Russian imports, but the business climate in the country looks problematic. The state is very interested in energy projects; however investors are cautious of moving into Ukraine’s energy business at the moment, as this often meant joining up or competing with state-based organizations, or groups that could be linked to state officials or their relatives.
Ukraine has significant shale oil gas reserves, according to the existing estimates, equal to those of Sweden and roughly one quarter of the reserves of the major reserve holders Poland and France. OECD/IEA indicates roughly 1,100bn m3 of gas reserves. Wood Mackenzie however indicates that the Lublin basin, in Poland, could have reserves in excess of 1,400bn m3 and have equal reserves in the Ukrainian portion of the basin.
Main shale gas basins in Ukraine [Source: Advanced Resources International, IntelliNews]
With Europe’s fourth largest shale gas reserves according to the OECD/IEA, and hopes for even more as supported by prognoses like those put forth Wood Mackenzie and others, the production stakes in Ukraine have aroused international interest. Exploration on the Ukrainian side of the border so far has been narrow however. This is largely the purview of internationals. TNK-BP, Gazprom and Shell are looking at Ukrainian exploration. There are also several junior explorers, such as Eurogas, actively exploring in Ukraine.
This is only a small extract of the insights in the IntelliNews Special Report, Ukraine Shale Gas Sector; read more and purchase>>