You're reading: Anti-shale gas campaign gets new momentum with Svoboda

Ukraine’s feeble attempts to wean itself from natural gas dependency through diversification are now finding enemies in unexpected places, including the oppositional Svoboda Party, which is now a political player on the national stage.

Svoboda received 37 seats in Ukraine’s 450-seat parliament in last year’s election. Despite campaigning mostly on social issues, such as the status of the Ukrainian language, the only parliamentary committee the party sought vigorously was the one dealing with ecological policy, natural resources and ongoing problems stemming from the 1986 Chornobyl power plant explosion.

The person Svoboda got elected as head of the committee is Iryna Sekh, a 42-year-old native of Lviv Oblast, and a fierce campaigner against the extraction of shale gas in her home region, where international giant Chevron plans to work.

Just days before her appointment to the committee, Sekh made a series of statements against the shale gas extraction in Lviv Oblast.

Her opposition is based on environmental concerns and lack of local input in the decision-making process. But shale gas proponents also note that slowing the nation’s progress in this area also serves the interests of Russia’s Gazprom, Ukraine’s main gas supplier.

“It’s not a threat, the extraction of shale gas … it’s a catastrophe,” Sekh told a roundtable in Kyiv on Dec. 12.  Sekh said that local communities were mostly ignored as global energy giants negotiated shale gas extraction deals with the central government. Secondly, she says there has been no assessment of the ecological risks. On Jan. 17, Sekh filed a draft resolution in parliament to initiate a hearing on shale gas extraction in Ukraine and its dangers.

“We’re fighting and asking, we want to know the truth, see the whole picture, we want to know the chemicals [that will be used for extraction], we want the public opinion to be counted in,” Sekh told the Dec. 12 roundtable.

Shale gas drilling companies in the U.S. have refused to name the chemicals they use during hydraulic fracturing to regulators, citing industry secrets. Several European countries have banned the controversial practice of “fracking” until more information is available, including its effect on the environment and underground drinking water.

Sekh could use her new leadership position in parliament to stall legislation.

Meanwhile, Ukraine needs diversification of gas sources badly. Its poorly equipped industry, notoriously energy inefficient households and leaky old transport networks make it one of the world’s top gas guzzlers.

Although gas consumption fell by nearly 10 percent in January-October 2012 compared to the same period a uear befpre, it still stood at 41 billion cubic meters, according to the Ministry of Energy and Coal Industry.

Most of this gas (27.7 billion cubic meters) Ukraine imports from Russia at an exorbitant price, having paid a total of $11.8 billion in January-October, a huge strain on a national budget that is only $51 billion annually.

Thus, in an attempt to reduce its dependency on Russian gas imports, in recent years Ukraine started looking for alternative gas sources, including extracting its own shale gas.

In May, the Cabinet declared international giant Chevron the winner of a tender to develop the Oleske deposit of shale gas in Lviv and Ivano-Frankivsk oblasts while Shell got the right to develop the Yuzovska gas field in Kharkiv and Donetsk oblasts. In August, a consortium of foreign and Ukrainian companies led by ExxonMobil won the right to develop the Skifska oil/gas field on the Black Sea shelf.

All three potential multibillion-dollar projects require years of geological studies before the extraction phase starts. The Oleske field alone, which holds an estimated 2.98 trillion cubic meters of shale gas, requires at least $160 million of investment into geological research, and another $3.1 billion in the industrial production phase, the then Ecology Minister Eduard Stavytsky said in December.

All shale gas projects were supposed to receive new momentum in December, when production sharing agreements were supposed to be signed, but they were not. Shell managed to inch closest to such an agreement on Jan. 16-17, when the Donetsk and Kharkiv oblast councils voted to approve the agreement. But the final document has yet to be signed.

Peter Clark, a Chevron representative in Ukraine, told Zaxid.net web portal that no team is yet working on the ground in western Ukraine.

Stavytky had said that the agreements have been stalled by local authorities, including Sekh.

Ildar Gazizullin, a senior economist at the International Centre for Policy Studies, says that some of these concerns are genuine. The impact assessment studies that are required in Europe for similar projects can be avoided in Ukraine. Also, last year the central government pushed through legislation that removed local councils from the list of bodies who have a say in the process of land allocation for such projects.

“Of course, there are risks, but these companies understand that any sort of ecological catastrophe would be disastrous for them,” Gazizullin said. He said that Shell, Chevron and others have “a history of granting very generous social programs” where they work. Chevron’s Clark, in his interview to Zaxid.net, also said the company plans to become a “good neighbor” and said that his company will take full responsibility “for the impact of its operation.”

Kyiv Post editor Katya Gorchinskaya can be reached at [email protected]