Boston, MA -- (SBWIRE) -- 06/25/2013 -- BMI View: Seemingly endless gas pricing disputes with Russia colour Ukraine's energy landscape, putting pressure on the country to maximise domestic production and diversify supply sources. Shell's decision to invest US$10bn in Ukraine's vast shale gas potential could contribute to a long-term solution to the country's gas supply woes. Russia continues to make overtures regarding ownership of Ukrainian gas infrastructure, but these have so far been rejected.

The main trends and developments we highlight for Ukraine's oil and gas sector are:

- Ukraine is aiming to increase its natural gas production by as much as 25% over the next three years in order to wean itself off costly Russian imports. Prime Minister Mykola Azarov said in November 2012 that the country's shale gas output could reach 20-30bn cubic metres (bcm) per year by 2020.
- Oil majors Royal Dutch Shell and Chevron were the winners of Ukraine's two shale gas fields, tendered in an auction that opened in February 2012, according to Reuters' Ukrainian government source. Shell has been awarded the Yuzivska field and Chevron the Olesska field. Shell has agreed on a US$10bn exploration and production (E&P) plan which could generate up to 20bcm annually from 2018 onward, according to the company.
- In August 2012, a consortium consisting of ExxonMobil, Shell, OMV Petrom and Nadra Ukrainy was awarded a 50-year production sharing contract (PSC) for the deepwater Skifska field, with an estimated 200-250bcm of gas-in-place, in the Black Sea. The group will be expected to begin work on the field before the end of 2012.
- BMI estimates that gas demand will rise from an estimated 64.6bcm in 2011 to 73.0bcm by 2016, climbing above 80bcm by 2021. Production could see a gradual rise from an estimated 20.1bcm in 2012 to 21.7bcm in 2016 as current exploration successes are slowly developed over the period. This will further rise to 26.8bcm by 2021 on the back of the beginning of shale gas output. Growing consumption means that import requirement is still set to rise, from 46.1bcm in 2012 to 55.8bcm by 2021.
- Ukraine is planning a liquefied natural gas (LNG) regasification terminal with annual capacity of 10bcm. However, we do not expect it to come online before 2018, although Ukrainian officials are targeting 2015. The government has actively courted Azerbaijan and Qatar for long-term LNG supplies.
- A slight downward revision to BMI's economic growth forecast for Ukraine leads us to increase our forecasts for Ukraine's oil consumption in 2016 to around 377,600 barrels per day (b/d) of oil. This could rise to 437,800b/d by 2021. With oil and gas liquids production likely to slip below 51,000b/d, Ukraine will require imports of at least 386,800b/d by the end of the forecast period.

View Full Report Details and Table of Contents

About Fast Market Research
Fast Market Research is an online aggregator and distributor of market research and business information. Representing the world's top research publishers and analysts, we provide quick and easy access to the best competitive intelligence available. Our unbiased, expert staff will help you find the right research to fit your requirements and your budget. For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156.

Browse all Energy research reports at Fast Market Research

You may also be interested in these related reports:

- Legacy Oil + Gas Inc. Oil & Gas Exploration and Production Operations and Cost Analysis - Q2, 2012
- Voyager Oil & Gas, Inc. Oil & Gas Exploration and Production Operations and Cost Analysis - Q2, 2012
- Pace Oil & Gas Ltd. Oil & Gas Exploration and Production Operations and Cost Analysis - Q2, 2012
- Imperial Oil Limited Oil & Gas Exploration and Production Operations and Cost Analysis - Q4, 2012
- Ironhorse Oil & Gas Inc. Oil & Gas Exploration and Production Operations and Cost Analysis - Q2, 2012
- Nordic Oil and Gas Ltd. Oil & Gas Exploration and Production Operations and Cost Analysis - Q2, 2012
- Painted Pony Petroleum Ltd. Oil & Gas Exploration and Production Operations and Cost Analysis - Q2, 2012
- PrimeEnergy Corporation Oil & Gas Exploration and Production Operations and Cost Analysis - Q2, 2012
- TransAtlantic Petroleum Ltd. Oil & Gas Exploration and Production Operations and Cost Analysis - Q2, 2012
- Equal Energy Ltd Oil & Gas Exploration and Production Operations and Cost Analysis - Q2, 2012