Ukraine to boost own energy output, seek non-conventional gas

MOSCOW, Jan 24 (PRIME) -- Ukraine is to continue raising it own production of energy and searching for alternative energy sources as year-long efforts to cut payments for Russian gas fail, President Viktor Yanukovich told reporters on Tuesday, according to RIA Novosti.

In 2011, Ukraine purchased around 40 billion cubic meters of gas from Russia and produced nearly 20 billion cubic meters itself. Ukraine has not yet produced non-conventional gas, but it plans to develop shale gas and coal bed methane deposits.

Yanukovich said that Ukraine would boost gas production further.

“Two years ago we decided to go by the way of increasing our own production of energy. Actually, we boosted coal production volumes within the last two years by 14 million tonnes,” Yanukovich said.

He said that in 2011 Ukraine produced 82 million tonnes of coal and coal surplus now amounts to 5 million tonnes.

“We can use coal as an energy product to replace gas, using the corresponding technologies in different sectors: metallurgy, power, and so on,” Yanukovich said.

Ukraine has long sought to alter the terms of a 2009 gas deal with Russia, signed by the then Prime Minister Yuliya Timoshenko. The agreement ties the price of gas to oil prices, which have risen sharply since that time boosting Ukraine’s bill.

Ukraine wants either to cut supplies to 27 billion cubic meters or reduce the price.

“We’ve inherited the problem, and it is holding us like a stranglehold,” Yanukovich said.

“The $416 gas price is the highest price in the world … Why do we have the most expensive gas in the world? This is an unfair approach, and it is unclear at all why Ukraine is being punished by the price.”

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