Economy

Ukraine has the potential to export its own gas - Fuks

Ukraine holds the third place in gas reserves in Europe, but own production covers only 65% of the demand, we have to import the rest 35%, Ukrainian businessman PavloFuks has said.

According to him, the state falls into energy dependence on the gas-supplying countries.

"Having such a huge potential, the country can not only stop buying imported gas in order to survive in winter, but also start exporting its own, well earning on its sale and lowering the tariffs!" he said.

Fuks also said that the forecasts of profile experts indicate that even if the state does not invest anything in geological prospecting, the reserves will last for more than 30 years. In addition to the above-mentioned advantages, the development of own production will give impetus to the development in the regions thanks to decentralization and distribution of incomes of local budgets.

"In the Kolomak merged territorial community in Kharkov region gas and condensate is extracted by Poltavagazvydobuvannia. In the four months of this year ending April 2018, the gas producing company invested UAH 3.2 million received from royalties in the development of the community's infrastructure, which is 75% of the total community's budget. Thanks to the government's decentralization, this is not only the energy independence of the state, but also the growth of prosperity and the improvement of living standards," Fuks said at a roundtable in the Verkhovna Rada devoted to the key priorities of the reforms of the extractive industry, taking the community as an example.

He also said that Ukraine should make the gas industry attractive to investors.

"Without investments, it is impossible to extract. Experts in the energy sector (including international ones) declare support for the development of domestic extractive industry by the government. The state has recognized the sphere as strategic. A number of important reforms recognized by the key partners of Ukraine have already been implemented, but this is not enough. Ukraine should make the gas producing industry attractive for investment," he said.

According to Fuks, the most important thing for any investor is the protection of their own investments, as well as clear conditions of doing business equal for all.

However, the region has a number of problems, in particular: sabotage at the local level (when regional councils block the extraction licenses); obsolete equipment for drilling (again, without investments there will be no modern equipment); the lack of transparent auctions (international oil and gas auctions should be implemented where gas producers could see a list of sites for development); discrepancy of the State Service of Geology with the strategic challenges of the era, as the authority should finally become a modern servicing agency and independent regulator responsible for oil and gas deposits; limited access to geological information, which is still archaic and closed to the public and a potential investor. (Geological information should be open, as it is done in all countries that were able to attract considerable investment in the industry (Canada, Mexico), and the lack of electronic services.

International practice shows the need to create electronic offices for access to geological information that will allow potential investors to independently analyze government proposals for making an investment decision.

The businessman said that Ukraine needs to continue eradicating the problems that for years have been driving the country into gas debts and dependence.

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