January 18, 2013 at 12:47 PM EST
Royal Dutch Shell (NYSE: RDS.A) to Develop Ukrainian Shale
The Ukraine may have Europe's third-largest shale deposit, and Royal Dutch Shell (NYSE: RDS.A) is one step closer to a development contract.

This Article Originally was Published here: http://www.energyandcapital.com/articles/royal-dutch-shell-nyse-rdsa-to-develop-ukrainian-shale/3003

Ukraine’s shale hopes are now closer to fruition, as deputies of the Donetsk regional council approved a deal with Royal Dutch Shell (NYSE: RDS.A), under which Shell and the Ukraine will develop the Yuzivska shale gas field.

Shell was picked as a possible partner last May, but approval has only just gone through.

U.S. Energy Information Administration estimates show the Ukraine may have the third-biggest shale gas reserves in all Europe – at some 42 trillion cubic feet – just after France and Norway.

From Reuters:

"If exploration is successful in the Yuzivska area, we will be able to produce a few billion cubic metres (bcm) of gas per year in just five-six years and eight to 10 bcm in 10 years," Environment and Natural Resources Minister Oleh Proskuryakov told the council.

"At its peak, in 13-15 years, annual production may exceed 20 bcm. This will not only strengthen our energy independence but will also significantly reduce gas prices."

It’d also mean much-needed independence from Russia. Presently, Ukraine coughs up $430 per thousand cubic meters to buy gas from Russia under a 10-year deal that was signed in 2009 by the former Ukrainian government. Kiev has been complaining about what it thinks is a steep price for a good while. But Russia, of course, has not reduced it.

The deal, which could be worth anywhere from $10 billion to $50 billion, should be wrapped up by May this year, and Shell has so far not commented on any specifics.

Ukraine also tapped Chevron (NYSE: CVX) to develop shale gas in Olesska, in the west of the country, last May. So far, no final contract has been signed.

This Article Originally was Published here: http://www.energyandcapital.com/articles/royal-dutch-shell-nyse-rdsa-to-develop-ukrainian-shale/3003



Royal Dutch Shell (NYSE: RDS.A) to Develop Ukrainian Shale originally appeared in Energy and Capital. Energy and Capital, a free daily newsletter, offers practical investment analysis in the new energy economy.
Stock Market XML and JSON Data API provided by FinancialContent Services, Inc.
Nasdaq quotes delayed at least 15 minutes, all others at least 20 minutes.
Markets are closed on certain holidays. Stock Market Holiday List
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.
Press Release Service provided by PRConnect.
Stock quotes supplied by Six Financial
Postage Rates Bots go here