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Ukraine And Chevron To Develop Shale Gas

Earlier this month, activists held rallies in the western city of Lviv to protest a proposed shale gas deal with Chevron.
KYIV -- Ukraine's government has approved a Production Sharing Agreement (PSA) with the U.S.-based company Chevron to explore and develop shale-gas deposits in the Lviv region.

Ukrainian Minister of Ecology and Natural Resources Oleh Proskuryakov announced the government's approval of the deal and said the PSA would be signed with Chevron on November 5 on the sidelines of an international economic forum in Kyiv.

Chevron says it will invest some $350 million in exploring sites in the Lviv and Ivano-Frankivsk oblasts and that its investment in the project will eventually total some $10 billion.

Ukraine is looking to develop three large shale-gas deposits with help from foreign companies. The three sites contain an estimated equivalent of 3 trillion cubic meters of gas, enough to meet Ukraine's energy needs for decades.

Meantime, Ukraine's energy minister has acknowledged that state oil and gas company Naftohaz has fallen behind in payments for Russian gas, but said he expects the matter to be settled very soon.

Eduard Stavytskyy said there had been "slight delays in payments" but that he believes the matter will be settled in the coming days. He said a Ukrainian delegation led by the Naftohaz CEO, Yevhen Bakulin, is currently in Moscow.

Aleksei Miller, the head of Russia's Gazprom, said Ukraine owes the state-controlled company $882 million for gas shipped in August. Miller also said that "advance payments will be considered in the future, as stipulated by the contract."
With reporting by ITAR-TASS, Reuters and Interfax