Ukraine plots fracking revolution
Ukraine is working to unleash natural gas fracking with the goal of becoming a major exporter and revolutionising Europe's energy market.
In plans critical to Volodymyr Zelensky's hopes of a post-war economic recovery, ministers in Kyiv are scrambling to lure private investment and gain access to new drilling technology to access the country's vast untapped shale gas resources.
According to sources close to Kyiv, officials are racing to attract 'foreign technology and highly experienced subsoil users', with a focus on unconventional shale resources in western Ukraine.
The hunt for cash - as revealed by the independent news platform Energy Flux - is being conducted in parallel to the rare earth minerals deal struck between Donald Trump and President Zelensky in April, which will allow the US to exploit Ukraine's natural resources, including aluminium, graphite, oil and natural gas.
The priority is to rapidly revitalise Ukraine's ailing gas sector after a gruelling winter saw roughly 40pc of production capacity taken out by a fierce Russian campaign of drone and missile strikes.
The attacks forced Ukraine to draw heavily on its gas stocks, which ended winter almost entirely depleted.
But Ukraine's Ministry of Energy believes it is possible to refill the country's cavernous underground storage facilities and even produce a surplus for export 'within 18 months', according to a senior government source.
Ukraine already has some experience with advanced drilling technology for old wells and has since carried out experimental trials that 'confirm its potential' for fracking, they said.
However, to unlock Ukraine's shale reserves, the country needs to attract more investment and newer kit, primarily from America.
'Development and production can be quickly developed using available gas infrastructure with connections to the EU gas market that make it very attractive,' the source added.
'Ukraine has enough deposits of traditional gas to cover its own consumption and to become a net exporter, and shale gas production has quite a profound effect on its development.'
Such a turnaround would help transform the fortunes of Europe's energy markets, which remain on edge following the loss of Russian pipeline gas exports via Ukraine at the start of 2025.
Refilling Ukraine's depleted gas storage – the largest in Europe, at 32bn cubic metres – is one of the main factors tightening energy markets in Central and Eastern Europe ahead of next winter.
Ukraine's gas stocks are today just 7pc full compared to the EU average of 50pc.
Efforts to pipe natural gas from Southern and Eastern Europe into Ukraine have also been thwarted by red tape and a lack of market cohesion.
However, if Ukraine could unleash its own shale revolution and create a surplus for export, the need to keep pumping European gas into Ukraine would effectively disappear overnight.
It would also help reduce Europe's reliance on costly liquefied natural gas (LNG) supplies from overseas.
Gas-starved Europe leaned heavily on LNG after Gazprom, the Kremlin-backed energy giant, halted exports to the EU following Vladimir Putin's full-scale invasion of Ukraine in 2022.
Ukrainian shale gas exports, if scaled up quickly, would erase a large chunk of European energy demand currently being met by LNG, potentially sparking a sharp drop in energy prices around the world.
However, Kyiv's proposed fracking revolution hinges largely on the country's ability to secure overseas investment.
Officials from Ukraine's Ministry of Energy are tapping Western diplomatic ties to find private capital funds with a high tolerance for risk to bankroll drilling and bring in technology partners.
A senior government team attended the Baku Energy Forum in Azerbaijan last week in part to promote Ukraine's potential as a shale hub.
Speaking at the event, one high-ranking statesman said the Lviv-Lublin geological area that straddles the Ukraine-Poland border is 'superior on the Ukrainian side' thanks to higher porosity and lower clay content, making it 'better for fracking'.
The most promising prospect is the Oleska (Olesskaya) shale block, which contains an estimated 0.8 to 1.5 trillion cubic metres of shale gas resources – enough to meet Ukraine's domestic needs for decades.
How much of this resource is economically recoverable is an open question. Chevron walked away from a 50pc interest in the Oleska project in 2014 before drilling could begin.
Chevron's stated reason for leaving was not because of political instability or lack of resources, but rather Kyiv's failure to enact specific tax reforms necessary to enable shale gas foreign investment.
Now, the Zelensky administration is moving to streamline operations and reduce bureaucratic hurdles that previously deterred foreign investors.
Ownership of the Olesskaya production sharing agreement (PSA) was transferred in April 2025 from government holding company Nadra Ukraine to Ukraine's largest oil and gas producer, Ukrnafta.
The move signalled a strategic shift in the country's approach to fracking, particularly in the Oleska block.
Ukrnafta is a state-owned enterprise following the nationalisation of strategic industries and declaration of martial law in 2022, which remains in force to this day.
Attracting significant private capital into Ukrainian shale exploration would normally be impossible under these circumstances.
However, the source said there are laws in place to ensure they can be overwritten.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Fox News
an hour ago
- Fox News
The Journal Editorial Report - Saturday, June 21
All times eastern FOX News Radio Live Channel Coverage WATCH LIVE: Trump returns to Washington to meet with his National Security Council
Fox News
an hour ago
- Fox News
Hot-air balloon crash in Brazil leaves 8 dead
All times eastern FOX News Radio Live Channel Coverage WATCH LIVE: Trump returns to Washington to meet with his National Security Council
an hour ago
What to know about the US B-2 bombers heading to Guam
Multiple B-2 stealth bombers were headed to Guam Saturday, two sources familiar with their movements told ABC News. At this point, the bombers have no orders beyond that, according to the sources. The moves come as tensions between Iran and the West have escalated over its nuclear program and the Trump administration weighs its options. Trump has had numerous meetings with national security advisors this week and said in a statement that he would decide within " in two weeks." The president is slated to have another Situation Room meeting later Saturday evening. The bombers could stay at Andersen Air Force Base in Guam for some time, but the question is for how long. Moving these aircraft does not mean that a final decision has been made. In addition to the bombers, eight refueling tankers took off just before midnight on Friday in Oklahoma, flew over Missouri, Kansas, Colorado, and New Mexico before turning around and landing at the same base they took off, ABC News learned. Over the past week, speculation has grown as to whether the Trump administration would use the 30,000-pound Massive Ordnance Penetrator to target Iran's deep underground uranium enrichment facility in Fordrow. The B-2 is the only U.S. Air Force bomber capable of carrying the MOP on bombing missions, with each bomber can carry two bombs. Attention turned to Whiteman Air Force Base in Missouri, which is the home to all 19 of the B-2 bomber fleet, and whether they might be launched for a nonstop flight to Iran that would require multiple mid-air refuelings. Attention was also focused on the small British island of Diego Garcia in the Indian Ocean that would afford B-2 bombers a much shorter flight time to Iran. In April, six B-2 bombers were deployed to the island as part of the sustained air campaign that the Trump administration had launched against Houthi militants in Yemen because of their continued attacks against commercial shipping in the Red Sea region. The bombers carried out airstrikes against Houthi targets in Yemen, but their deployment was also a strategic message to Iran at a time of heightened tensions between the U.S. and Iran.
