On 25th of October in the Pervomaysk region of Kharkiv oblast Shell and «Ukrgazvydobuvannia» started to search for unconventional hydrocarbons

October 8, 2012 Scientific-Technical Center «Psycheа» held the International expert and analytical roundtable «Basin Center Gas: prospects and risks of production in Ukraine» (video here). Independent Ukrainian and American experts, representatives of the Coordination Centre for the implementation of economic reforms under the President of Ukraine, of the Council of National Security and Defence of Ukraine, of academic and industrial science discussed the economic, technological, and environmental issues of exploration and production of unconventional energy resources, as well as international best practices for an effective regulatory environment. The participants supported the initiatives of international investors, which are starting the search for Basin Center Gas in our country, but stated that the companies should be prepared for «specific» work in Ukraine and they should involve the expert community into solving the emerging problems.

Man will never take a step in a direction which he considers unpromising.

(Marie Joseph Pierre Teilhard de Chardin, French theologian and philosopher)

Basin Center Gas (BCG, tight (sandstone) gas) – a gas mixture which is present in reservoirs with low porosity and low permeability containing siltstones and ritmites. Unlike conventional gas resources, the Basin Center Gas is not associated with traditional traps, it is located in the whole central immersed part (depressions and hollows) of oil and gas basin, occupying large areas. Within the large accumulations of this gas there are also conventional gas deposits. Therefore the Basin Center Gas deposits are larger than the total conventional ones.

From a technological point of view, BCG is considered one of the priorities among unconventional types. While evaluating and preparing gas-bearing tight reservoirs to drilling, assessing the prospective resources and industrial reserves traditional methods and techniques of hydrocarbons production are used. Therefore the issue of the development of the BCG is not so much a geological but technological and economic.

Studies of BCG for the first time started in North America (mainly in the U.S.) in 1970th due to a decrease in the production of conventional energy sources. Resources of the BCG in the United States are, according to various estimates, 12…142 trillion cubic meters. The volumes of gas production of this type in the U.S. are up to 30 billion cubic meters a year. The development is carried out with the use of intensifying techniques (hydraulic fracturing) in the areas of high productivity (sweet spots) in the Rocky Mountains (San Juan, Gray Green River, Western Canada) and the North American plate (Anadarko, Appalachian, Permian, Val Verde). Usually 28…40% of gas can be extracted. With the development of technologies the extraction gas factor can be increased up to 60%…

Read full article — Basin Center Gas: Prospects And Risks

Back to history

The issue of energy saving was in the focus of the Ukrainian authorities at the birth of Ukraine as a state. Back in 1994, the Law of Ukraine «On Energy Saving» was drawn up in a form more akin to a declaration. However, the law did stipulate the energy saving notion and its essence.

Pursuant to the provisions of the law, the government issued a decision in February 1997 to enforce a «Comprehensive State Energy Saving Program of Ukraine.» The paper noted that state energy saving policy guidelines should be developed on the basis of an analysis of existing conditions and forecasts for economic development, which would foresee the creation of a regulatory framework for energy saving, the formation of a favorable economic environment, and the development of an integrated and effective system of state management for energy saving. It was noted that the largest shares in the structure of the energy saving potential belong to:

•  industry — 58-59%;
•  the fuel and energy sector- 19-20%;
•  the utilities sector — 11-12%;
•  transport — 7-7.7%;
•  agriculture — 3-3.5%.

In order to implement the program by 2010, it was planned to allocate public funds or attract investment of about $6 billion. This could have laid a good foundation for the future, given that the expected economic benefits by the end of the program were expected to amount to $4.7 billion, and the inefficient consumption of fuel and energy resources could reduce by 108 million tonnes of equivalent fuel.

The stages of its implementation were set in keeping with the best traditions of that period:

1997-1998 was to be the first stage. The main emphasis was made on curbing unnecessary fuel and energy consumption with the utilization of non-capital-intensive energy saving technologies. This would help reduce the cost of fuel and energy resources by 10-15% and save more than $200 million. This was the period for laying the foundations of public policy, which were based on fiscal and administrative management practices.

The second stage in 1998-2000 envisaged activities to improve the energy efficiency of existing technical and technological facilities, thereby saving 15-25% more inefficiently consumed energy and saving $300 million. But by the end of the second phase it became apparent that the program was not going well: a mere 12 million tonnes of equivalent fuel (30% of the target) had been saved by 2000 (the target was set at 36 million tonnes as of 2000).

The third phase, which ended in 2010, intended to restructure the Ukrainian economy, which would reduce demand for energy resources by 30%, stabilize their consumption and achieve an optimal level of energy supplies.

The crisis on the aviation fuel market: deja vu

The crisis has hit us again, as can be seen on the jet fuel market now. Fuel prices have almost doubled since the beginning of the year, and the market is experiencing shortages. Fueling limits are in effect at almost all of the airports in the country. The Cabinet of Ministers is doing its best to help the country’s main airport — Boryspil International — by allocating to it 3,000 tonnes of jet fuel from the state reserve. The Infrastructure Ministry has demanded the urgent certification of Jet A-1 fuel, which is most likely to be sold by Orlen Lietuva to local traders.

«The appearance of a new player will saturate the market with fuel priced lower than locally produced fuel,» the Energy and Coal Industry Ministry has claimed optimistically. But has the problem really been solved?

You can read full article at the journal “Terminal: oil review” №42(576) 17 oct 2011

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The United States is watching a political vaudeville; the European Union is seeing Germany taking on a lady-of-the-house role.

Against the backdrop of numerous and varied negative scenarios for the development of the global economy, the markets are in fact responding to forecasts given by leading organizations. Macroeconomic statistics play a secondary role: Emotional statements by U.S. and European leaders are now grabbing investors’ attention.

You can read full article at the journal “Terminal: oil review” №42(576) 17 oct 2011

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 Yulia Tymoshenko gets her verdict and a new case

Kyiv’s Pechersk District Court has declared former Prime Minister Yulia Tymoshenko guilty of abuse of office when she concluded natural gas contracts in 2009, and sentenced her to seven years in prison. The court also satisfied NJSC Naftogaz of Ukraine’s claim [against Tymoshenko] and obliged her to compensate the oil and gas company for UAH 1.5 billion in losses it sustained due to the signing of the agreements.

«The price was incommensurable with agreements reached earlier,» Judge Rodion Kireyev said while reading out the verdict.

You can read full article at the journal “Terminal: oil review” №42(576) 17 oct 2011

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Taner Yıldız, Turkey’s Minister of Energy and Natural Resources, has announced that his country will not prolong a natural gas agreement with Russia signed way back in 1986, during Soviet times, and which expires this December. This means Turkey will stop buying gas pumped via Ukraine, Moldova, Romania, and Bulgaria. In the opinion of experts, Ankara’s decision will cause Kyiv losses estimated at $160 million.

You can read full article at the journal “Terminal: oil review” №41(575) 10 oct 2011

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Global markets have got tired of bad news – they’re so tired that the announcement of macroeconomic statistics showing even slight or zero growth is seen as a considerable achievement. The optimistic mantras chanted in the United States and the European Union now serve as a well of enthusiasm for the markets…

You can read full article at the journal “Terminal: oil review” №41(575) 10 oct 2011

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The country’s updated Energy Strategy seems to retain the mistakes of the previous version

Under «A Wealthy Society, Competitive Economy, and an Effective State» Program for Economic Reforms for 2010-2014, Ukraine’s Energy Strategy, which was approved under cabinet resolution No. 145-r dated March 15, 2006, should have been updated by the end of 2010. In particular, it should have outlined «a rational position of the state» in issues of the production of fuel and energy, target-oriented environmental guidelines, sources of reform financing, integration into the energy community, the development of national energy efficiency standards and the introduction of «a state fuel and energy balance monitoring system» in the country.

But the promised document still has not appeared, although nine months have passed since the deadline set by the president of Ukraine. What is more, nobody knows either the chief draftsman, or the responsible executors, or the names of advisors involved … But judging from the drafts of the «updated» strategy now migrating between clerks’ offices, an anonymous pen from Pechersk [Kyiv's governmental heartland] will produce the next wish list soon.

You can read full article at the journal “Terminal: oil review” №41(575) 10 oct 2011

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Belarus and Venezuela plan to produce oil together with China. This and other projects were discussed during the visit of the Belarusian delegation to Venezuela, the ONT TV Channel informs.

The two sides talked over cooperation in oil production and petrochemistry. According to the signed agreement, the Belarusian-Venezuelan company Petrolera BeloVenesolana includes into its schedule two more oil deposits near Maracaibo Lake. Apart from that, the sides agreed on trilateral cooperation in oil production. “We have reached an agreement to work in this large oil-rich region together with Venezuela and China. We can produce thousands of barrels of oil per day,” Viktor Sheiman, the Aide to the President of Belarus on Special Matters, said. He stressed that oil production would increase many times once the parties develop the region.

Venezuela also got interested in the Belarusian technology of producing fiber-cement boards. “This technology fully meets technical requirements of the region with seismic conditions similar to those in Venezuela,” Architecture and Construction Minister of Belarus Anatoly Nichkasov noted. Venezuela has showed an immediate interest in the construction of 12 fiber-cement board plants.

The Belarusian delegation attended the inauguration of the first Belarusian agrotown in the state of Guarico. The agrotown will include a commercial dairy farm for 1,100 cows, a cattle farm, a battery, a plant to process dairy products and a plant to process poultry and beef.

Source: BelTA