One of the key requirements of the International Monetary Fund (IMF) for Ukraine is to raise the gas price to the market level: the government should introduce a mechanism for automatic regulation of tariffs for gas and heat, so that they remain at the market level, businessman Pavlo Fuks wrote in his blog in the Focus publication. "It is logical and quite right, when not the separate corruption schemes dictate the price under the guise of good intentions, but the market does it. For this it is vitally to satisfy the demand and give the opportunity of extracting gas," the businessman wrote.

Now, almost all the production is focused in the hands of state-owned enterprise Ukrgazvydobuvannia (incorporated in Naftogaz Ukrainy). The company has accumulated more than 170 licenses, of which only about 30 are being developed. If licenses are not developed, then why are they not brought to the market, allowing private companies to be engaged in the extraction?

There is another problem: the absence of oil and gas auctions, Fuks wrote. "Recently experts compared the starting price, which was set for the fields put up for auctions, with the one at which they were sold in the previous auctions two years ago. So, during the bidding, the price for universal exploration and production licenses was increased six-fold on average. Think of that – six-fold (!), while not at the auctions these fields are sold only at the starting price."

Over the past five years, gas production by private companies has grown significantly. If before 2013, they extracted 2 billion cubic meters of gas, then in 2016, twice more – 4.086 billion cubic meters. The volume of gas production by private producers in 2017 amounted to 4.1 billion cubic meters. And by 2020, the figure for private companies can reach 5-6 billion cubic meters, which accounts for 25-28% of all gas production in Ukraine.

"For comparison: Ukrgazvydobuvannia cannot boast such a rapid rate of increase in gas production unlike private companies. This is a clear example of the effectiveness of the private business against the inefficiency of the state as a manager," he said.

According to the Economist publication, in 2017, the global economy grew faster than ever in the past six years, but this growth is slowing now. This means that Ukraine needs to take care of itself as soon as possible in order to reduce dependence on external factors: work harder to deregulate the energy sector, facilitate the allocation of land and increase the transparency of the gas industry; create data centers with geological information. Thanks to this, a comfortable investment climate will be formed.

At the same time, the businessman wrote that the amount of initial investment in gas production is not so unbearable - about $3.5-5 billion to cover domestic demand. Ukraine paid approximately this sum for imported gas in 2015 alone.

"The 2018 year is declared the year of Ukraine's energy independence. A competent and effective policy of the Ukrainian government could not only overcome the current lag, but also double the current production by 2022. The first step to achieve this is a withdrawal from the monopolies, qualitative exploration and a market open to investment," Fuks said.