Two energy behemoths
Royal Dutch Shell plc
) have been awarded the exploration rights for two shale gas fields
- Yuzivske and Oleske - in Ukraine. The total investment for the
project is projected to be around $170 million for the Oleske field
and $200 million for Yuzivske, totaling $370 million.
Per the reports of the Ukrainian state geological service, the
Oleske field that spans over 2,316.6 square miles is estimated to
hold about 3 trillion cubic meters of conventional and
unconventional, as well as condensed gas deposits. The other field
Yuzivske is likely to have a reserve of 4 trillion cubic meters of
Together the fields, where industrial extraction of gas is
expected to begin in 2018-2019, will contribute up to Ukraine's 10%
domestically consumed natural gas by 2020.
Apart from Shell,
Exxon Mobil Corp.
), and TNK-BP had also forwarded their bids for the development of
the eastern Ukraine located Yuzivske field. To obtain rights to set
up gas production at Oleske, Lviv region, Chevron edged out the
This move highlights Ukraine's attempt to capitalize on the
booming shale gas scenario and develop its large untapped resource
of shale gas. The establishment of a strong domestic gas industry
will also minimize the country's dependence on Russia.
San Ramon, California-based Chevron is engaged in global oil and
gas exploration and production, refining and marketing of petroleum
products, manufacturing of chemicals, and other energy-related
The Royal Dutch Shell plc owns one of the largest integrated oil
and gas businesses in the world. The group has operations all over
the world and is involved in various activities related to oil and
natural gas, chemicals, power generation, renewable energy
resources, and other energy related businesses.
Chevron and Shell, both, currently retain a Zacks #3 Rank that
implies a short-term Hold rating for a period of one to three
months. We are also maintaining long-term Neutral recommendation on
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