Ukraine to Start Selling its Own Gas to Europe

Sep 08, 2011, 10:50 ET from Worldwide News Ukraine

KYIV, Ukraine, September 8, 2011 /PRNewswire/ --

Ukraine plans to increase its own gas production up to 25 billion cubic meters by 2015 and start selling the excess amount of gas to Europe, said the Minister of Coal Industry of Ukraine Yuri Boyko at the press conference in Kyiv. He also mentioned that the increase would not affect its current gas contracts with Russia.

According to minister Boyko, Ukraine produces 20 billion cubic meters of gas annually. This amount will increase by 25 percent in three years. This will be the result of the recently signed contract with Shell on joint gas extraction. Within the next two months Ukraine plans to sign five more contracts with gas extraction companies, said Yuri Boyko.

During the briefing the energy minister mentioned that Ukraine will continue buying gas from Russia according to the existing contracts. "We [Ukraine -ed.] will buy as much gas [from Russia - ed.] as our economy needs. If we are offered more gas we will gladly buy it, given our advantageous transit location and the availability of the storage facilities," said the minister. "Granted, we will resell our own gas to Europe when the prices peak and it's most beneficial for us," added the high official.

In addition, minister Boyko stressed that Ukraine will continue introducing measures to reduce its domestic gas consumption. Ukraine has already informed its Russian partners about the plan to purchase 27 billion cubic meters in 2012 vs. 40 billion in 2011. Some of the measures include the installation of electric compressors in the Ukrainian gas transportation system as well as the increase of coal mining. "We will substitute gas by coal in the energy balance of the country," claimed the minister.

Earlier this year the Minister of Environment and Natural Resources of Ukraine Mykola Zlochevsky said that the reserves of shale gas in Ukraine are at least 30 trillion cubic meters. Zlochevsky noted that after the U.S. Geological Survey assessed Ukrainian unconventional gas resources it came up with a significantly higher numbers - more than 40 trillion cubic meters of unconventional gas.


SOURCE Worldwide News Ukraine