Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
Stock Market Correction Review - 26th Jan 20
The Wuhan Wipeout – Could It Happen? - 26th Jan 20
JOHNSON & JOHNSON (JNJ) Big Pharama AI Mega-trend Investing 2020 - 25th Jan 20
Experts See Opportunity in Ratios of Gold to Silver and Platinum - 25th Jan 20
Gold/Silver Ratio, SPX, Yield Curve and a Story to Tell - 25th Jan 20
Germany Starts War on Gold  - 25th Jan 20
Gold Mining Stocks Valuations - 25th Jan 20
Three Upside and One Downside Risk for Gold - 25th Jan 20
A Lesson About Gold – How Bullish Can It Be? - 24th Jan 20
Stock Market January 2018 Repeats in 2020 – Yikes! - 24th Jan 20
Gold Report from the Two Besieged Cities - 24th Jan 20
Stock Market Elliott Waves Trend Forecast 2020 - Video - 24th Jan 20
AMD Multi-cores vs INTEL Turbo Cores - Best Gaming CPUs 2020 - 3900x, 3950x, 9900K, or 9900KS - 24th Jan 20
Choosing the Best Garage Floor Containment Mats - 23rd Jan 20
Understanding the Benefits of Cannabis Tea - 23rd Jan 20
The Next Catalyst for Gold - 23rd Jan 20
5 Cyber-security considerations for 2020 - 23rd Jan 20
Car insurance: what the latest modifications could mean for your premiums - 23rd Jan 20
Junior Gold Mining Stocks Setting Up For Another Rally - 22nd Jan 20
Debt the Only 'Bubble' That Counts, Buy Gold and Silver! - 22nd Jan 20
AMAZON (AMZN) - Primary AI Tech Stock Investing 2020 and Beyond - Video - 21st Jan 20
What Do Fresh U.S. Economic Reports Imply for Gold? - 21st Jan 20
Corporate Earnings Setup Rally To Stock Market Peak - 21st Jan 20
Gold Price Trend Forecast 2020 - Part1 - 21st Jan 20
How to Write a Good Finance College Essay  - 21st Jan 20
Risks to Global Economy is Balanced: Stock Market upside limited short term - 20th Jan 20
How Digital Technology is Changing the Sports Betting Industry - 20th Jan 20
Is CEOs Reputation Management Essential? All You Must Know - 20th Jan 20
APPLE (AAPL) AI Tech Stocks Investing 2020 - 20th Jan 20
FOMO or FOPA or Au? - 20th Jan 20
Stock Market SP500 Kitchin Cycle Review - 20th Jan 20
Why Intel i7-4790k Devils Canyon CPU is STILL GOOD in 2020! - 20th Jan 20
Stock Market Final Thrust Review - 19th Jan 20
Gold Trade Usage & Price Effect - 19th Jan 20
Stock Market Trend Forecast 2020 - Trend Analysis - Video - 19th Jan 20
Stock Trade-of-the-Week: Dorchester Minerals (DMLP) - 19th Jan 20

Market Oracle FREE Newsletter

Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

Ukraine to Cut Gazprom's Umbilical Cord?

Politics / Natural Gas Aug 13, 2011 - 06:46 AM GMT

By: OilPrice_Com

Politics

Sometimes it's not easy being Russia's neighbor - just ask Ukraine. Ever since the 1991 implosion of the USSR, Ukraine's relations with Russia have appeared between coldly formal and outright hostility, with a major irritant being the increasingly high prices Gazprom charges for natural gas.


Gazprom in turn needs access to Ukraine's pipeline network in order to reach its profitable European customers. Faced with this symbiotic relationship, Kiev has been assiduously looking for ways to break out of its dependency on Russian energy imports, and now it looks as if this may in fact be coming true.

The head of Ukraine's state geology and subsurface resource service Gosgeonedr Eduard Stavitsky said, "Today, the state fund of subsurface resources is about 1.1 trillion cubic meters of gas and about 130-150 million tons of oil with gas condensate. In from seven to ten years, Ukraine will be able to fully supply itself with gas and oil, excluding the purchase of imported energy resources."

TNK-BP is ready to invest $2 billion in the development of shale gas in Ukraine by 2020. Shell has already prepared a project for extraction at the Yuzovsky gas field and is ready in the next three years to pump several billions of dollars into opening it, hoping within ten years to be extracting around 8-10 billion cubic meters of gas per year there.

In Western Ukraine, investors, particularly Chevron, are showing interest in the Olessky field, straddling the Lviv, Ivano-Frankivsk, and Ternopol regions, covering around 2,700 square miles.

According to Ukrainian Deputy Fuel and Energy Minister Serhiy Chekh, Ukraine's state-run Naftogaz energy company is drafting an agreement with global oil and gas group Shell to develop the Black Sea shelf. Chekh said Ukraine could boost oil and gas production in the Black Sea and the Sea of Azov but it would require significant investment, but nevertheless Ukraine plans to raise oil output on the Black Sea shelf to 2.9 million tons a year by 2015, including gas condensate.

If Ukraine is in fact able to achieve energy independence, it will rob Moscow of one of its major bargaining holds over Kiev. Quite aside from the fractious issues involved in the transiting of Gazprom natural gas through Ukraine, another issue that has roiled Russian-Ukrainian relations for the past two decades still remains unresolved, Russia's continuing use of the Crimean port of Sevastopol for its Black Sea Fleet. In the past Moscow has played hardball over continued use of the port, most notably by using its "natural gas weapon."

Given energy's centrality to the country's prosperity, this has proven a major obstacle for many of Ukraine's previous political leaders, including Viktor Yushchenko.

More than any other former Soviet state, Moscow desires a "friendly" Ukraine. Among other things this means for Ukraine, no NATO membership, a high priority of President Yushchenko. Should Kiev step out of line, Moscow still has a number of cards to play, including the country's ethnic Russian population, roughly 17 percent of the country's citizenry.

For the European Union, however, Ukrainian self-sufficiency in energy production could prove to be a significant lessening, as it could put an end annual brinkmanship laid by Russia and Ukraine over natural gas exports, which has disrupted winter supplies over the past several years.

Source: http://oilprice.com/Energy/Natural-Gas/Ukraine-to-cut-Gazprom-s-umbilical-cord.html

This article was written by Dr. John CK Daly for Oilprice.com who offer detailed analysis on Crude Oil, Geopolitics, Gold and most other commodities. They also provide free political and economic intelligence to help investors gain a greater understanding of world events and the impact they have on certain regions and sectors. Visit: http://www.oilprice.com

© 2011 Copyright OilPrice.com- All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules