You're reading: Ukraine plans to sign PSAs with Shell, Chevron, ExxonMobil in early December

Ukraine's Cabinet of Ministers plans to sign production sharing agreements (PSAs) with Shell, Chevron and a consortium headed by Exxon Mobil in early December, Ukrainian Environment and Natural Resources Minister Eduard Stavytsky said at a press conference in Kyiv on Tuesday.

“I expect that we’ll sign all three contracts in the first two weeks of December,” he said.

Although there are some complications with the local governments in Lviv and Ivano-Frankivsk regions, these issues are being worked out, Stavytsky said.

At the beginning of May 2012, Ukraine’s interdepartmental commission on PSAs declared Chevron the winner of a tender to develop the Oleske field in Lviv and Ivano-Frankivsk regions, and Shell the winner of the rights to develop the Yuzovska gas field in Kharkiv and Donestk regions.

For the development of the Yuzovska field, with its projected reserves of an estimated 4.054 trillion cubic meters of various categories of gas, the plans call for raising at least UAH 1.6 billion in investment in the geological study phase, and UAH 30 billion in the industrial production phase.

For the development of the Oleske field, with its projected reserves of an estimated 2.98 trillion cubic meters of shale gas, the plans call for raising at least UAH 1.3 billion in the geological study phase, and UAH 25 billion in the industrial production phase.

On August 15, a consortium comprised of ExxonMobil, Shell, Petrom (based in Romania, a subsidiary of Austria’s OMV) and NJSC Nadra Ukrainy won the PSA tender for the Skifska oil and gas field on the Black Sea shelf.

The Skifska field covers 16,698 square kilometers and borders Zmiyiny (Serpent) Island. The total investments in this field were previously estimated at $10-12 billion. Projected annual natural gas production could total 3-4 billion cubic meters (bcm), and budget revenues could total UAH 80-90 billion.