Forbes/AFX News Limited: Shell, Naftogaz sign gas exploration pact in Ukraine: "This marks Shell's first upstream business in Ukraine.": Thursday 1 December 2005

LONDON (AFX) - Royal Dutch Shell PLC and Naftogaz Ukrainy have agreed to jointly search for gas in Ukraine.

Under an agreement, the pair will explore an area covering over 31,000 square kilometres in the Dniepr-Donets basin, located in the central-eastern part of the country.

The site is believed to contain 'potentially significant' volumes of natural gas, Shell said in a statement.

Shell will take up a 50 pct stake in the project and spend 100 mln usd in the initial exploration work, due to start next year.

This marks Shell's first upstream business in Ukraine. Since it entered the country in 1992, the Anglo-Dutch oil group's operations there have been limited to lubricants marketing and distribution.

mbe/ak

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