THE WALL STREET JOURNAL: Shell To Work
With Ukraine Naftogaz On Gas Exploration: " A person close to Shell said the
deal, the first of its kind in Ukraine for an international oil major, could
help the Anglo-Dutch company gets a foothold into the country's hydrocarbons
reserves." (ShellNews.net) Posted 11 May 05
DOW JONES NEWSWIRES
LONDON -- Royal Dutch/Shell (RD, SC) Tuesday struck a cooperation agreement to
explore potential gas resources with Ukrainian national gas company Naftogaz
Ukrainy (NGAZ.YY) in the Dniepr-Donets basin.
A person close to Shell said the deal, the first of its kind in Ukraine for an
international oil major, could help the Anglo-Dutch company gets a foothold into
the country's hydrocarbons reserves.
The companies have agreed to cooperate in technical studies covering an agreed
area of joint interest of over 30,000 square kilometers, with the potential for
further enlargement, Shell said in a statement.
The company added the studies will lead to joint exploration for and production
of hydrocarbons.
"We believe the combination of the detailed technical and operational knowledge
of Naftogaz Ukrainy and access to state-of-the-art technology from Shell will
result in mutual benefits and we look forward to a fruitful partnership", said
Naftogaz Ukrainy's Chairman, Olexiy Ivchenko.
Shell already has downstream activities in Ukraine, but getting access to
upstream opportunities is essential as the company needs to rebuild its reserves
after downgrading them five times since last January.
According to the U.S. Department of Energy, Ukraine has roughly 40 trillion
cubic feet of natural gas reserves, from which roughly 0.69 tcf was produced in
2003.
The pact comes as neighboring Russia has expressed reluctance to make new energy
resources available to foreign companies.
The Ukrainian deal is the latest exploration deal with newly opening countries.
Last week, it was awarded five gas blocks in Libya, along with the upgrade of a
liquefied natural gas plant.
Company Web site: http://www.shell.com
-By Benoit Faucon, Dow Jones Newswires; +44 (0)20 7842 9266; benoit.faucon@dowjones.com