Ukraine has the third largest deposits of natural gas in Europe, but the process of its extraction is quite complicated and requires modern technologies, since it lies at a depth of 5-6 km.
Currently, Naftogaz is negotiating with American drilling companies to increase gas production in order not only to make Ukraine energy independent and provide its own gas, but also to turn Ukraine into one of the gas suppliers to Europe, reports The Telegraph.
But, as Myron Vasilyk, adviser to the chairman of Naftogaz, assures, Ukraine will not be able to enter the European gas market until the second half of this decade, since its exploration and drilling takes a long time. To begin with, Ukraine needs to fully cover its own needs for this resource, now consumption volumes are much less than a simple part of the industry – one of the main consumers of this energy resource.
At the end of 2022, gas production in Ukraine will fall by 8-10% due to the war of war and the bureaucracy factor. The law on linking gas rents to domestic prices came into force only in early October. Prior to this, private enterprises engaged in gas production in Ukraine reduced production, as they were forced to pay rent at world prices, they could only sell gas to Naftogaz at domestic low prices or pump it into gas storage facilities.
The export of gas is now banned. Ukrainian gas is expensive to produce, so by paying rent at world prices and selling gas at domestic Ukrainian prices, companies simply operated at a loss.
Ukraine has a developed gas transportation system, which will reduce the cost of gas delivery to Europe, since liquefied gas is more expensive than gas from gas pipelines.
Source: Racurs
