NYT: Ukraine looks to Texas for an energy path

14:16, 12 May 2011
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Ukraine is ready to bet that the path to energy independence is through the Texas city of Fort Worth, Andrew E. Kramer in collaboration with Clifford Krauss wrote in a New York Times article last week, according to KyivWeekly.

“Ukraine, which sits atop tantalizingly large shale deposits, is eager to do business.

Already this year, Ukraine has opened talks with three Western energy giants -- Exxon Mobil, Chevron and Shell — to search for shale gas. Ukraine’s Parliament has also passed investor-friendly legislation aimed at opening its domestic natural gas market to shale gas producers,” the article reads.

Meanwhile, the nation’s president, Viktor F. Yanukovych, has signed a shale-gas exploration agreement with the United States and reached an accord with the European Union on energy transport that opens Ukraine’s pipeline system to Western companies.

Along with the energy companies courting it, Ukraine sees shale as potentially altering the geopolitics of natural gas, lessening global reliance on Russia and the Middle East.

Although Ukraine already produces some natural gas by conventional means, it remains highly dependent on imports from Russia’s state-owned gas monopoly, Gazprom, the world’s biggest producer.

Ukraine has four major, largely unexplored shale deposits, according to Valeriy Berezhniy, chief geologist for Vikoil, a Ukrainian seismic exploration company studying unconventional natural gas deposits.

Ukraine’s minister of energy and coal, Yuriy A. Boiko, met with American shale gas executives in Houston this year and announced a once far-fetched sounding goal for Ukraine to become self-sufficient in natural gas.

“We understand that American science is rich in this field,” Mr. Boiko told an audience of mostly Western energy company executives at a conference on shale gas in Kyiv last month — the first such gathering for the industry in Ukraine. “We would like to attract this technology, and we would like to attract partners,” he added.

Gazprom’s chief executive Aleksei B. Miller has dismissed the technology last year as environmentally unsound and expensive, and said that shale gas would affect only the margins of Gazprom’s business. More recently, shale gas wildcatters at the Kyiv conference said they could not be more pleased with Gazprom’s behavior. By keeping natural gas prices in Ukraine and elsewhere in Europe higher than gas prices in the United States, they said, Gazprom is making shale exploration in Eastern Europe look all the more profitable, the NYT article concludes.

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