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Ukraine Signs Major Shale-Gas Deal

Eduard Stavytskyi, chairman of Ukraine's state geology and mineral resources service (center), watches as Ukrainian President Viktor Yanukovych (left) shakes hands with Peter Voser, CEO of Royal Dutch Shell in Davos, on January 24.
Ukraine has signed a shale-gas deal with Royal Dutch Shell worth at least $10 billion -- potentially the largest foreign investment ever in the country.

The deal was signed on January 24 by Ukrainian President Viktor Yanukovych on the sidelines of the World Economic Forum in Davos.

Under the agreement, the Yuzivska shale-gas field in eastern Ukraine would be tapped using the controversial new technology of hydraulic fracturing, or fracking.

Ukraine is believed to have an estimated 1.2 trillion cubic meters of shale-gas reserves, the third-largest such deposits in Europe.

Ukrainian officials say Shell's investments would likely be around $10 billion but could go as high as $50 billion.

Environmental groups say chemicals used in the fracking process can threaten the health of surrounding communities, but the industry has aggressively challenged those claims.

Based on reporting by Reuters and Interfax