Shell to invest $800mn in Ukraine shale gas
Shell has agreed to invest up to $800 million as part of a project to extract shale gas in Ukraine, according to officials with both the company and the Ukraine government.
The agreement that was signed between the Ukrainian public company Ukrgazvydobuvannia and Shell stipulates the future cooperation in the area of exploration and extraction of hydrocarbons in Dnipro-Donetsk basin, Central Ukraine.
According to the agreement, Ukraine will be able to take advantage of modern technology and start developing unutilized gas resources, including the unconventional ones, it said.
The parties agreed that Shell is going to invest up to $800 million into the shale gas development project. The first stage of the project is estimated at $200 million with $600 million to follow.
After the meeting with the president of Ukraine, Shell CEO Peter Voser said Shell was interested in the cooperation and confirmed the company's eagerness to provide expertise as well as the technology, to intensify and diversify mining of energy resources in Ukraine.
The initial agreement between Ukrgazvydobuvannia and Shell was signed in 2007 and stipulated the first stage of developing of the Dnipro-Donetsk trench. The potential of the area was estimated at 400 billion cubic meters of gas.
Notably, around 80% of hydrocarbon extraction in Ukraine is conducted in Dnipro-Donetsk trench, Ukraine officials said.
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