 |
| Energy In Ukraine The Ukraine is a net energy importer. The main imports are oil and natural gas, primarily from Russia. In 1997, the Ukraine imported an estimated 325,000 barrels of oil per day and over 2.1 tcf of natural gas. The primary domestic energy resources include coal and nuclear power. Ukraine has proven oil reserves of 595 million barrels, and over the last 20 years, the country's oil production has declined by more than 60%. Much of the decline was due to the Soviet Union's diversion of resources to develop oil reserves in Siberia, combined with insufficient investment in Ukraine's oil sector since its independence in 1991. Ukraine currently imports nearly 80% of its oil, almost all of which comes from Russia. In 1997, Ukraine produced 85,000 barrels per day (bbl/d), down from a peak of approximately 279,000 bbl/d in the mid-1970s, and consumed 410,000 bbl/d. In 1996, the government approved a plan for restructuring the oil industry and for creating vertically integrated holding companies. The plan called for the restructuring of oil and gas exploration and drilling enterprises, refineries, storage and transportation facilities and retail gasoline stations. It was designed to encourage competitiveness within the sector and to encourage foreign investment. It also calls for the country to reduce its dependence on foreign oil imports and to increase domestic oil production to approximately 150,000 bbl/d by developing new reserves and by expanding output from existing fields. Ukraine has natural gas reserves of 69 trillion feet, but only about 20% of the country's demand is met by domestic production. In 1997, Ukraine produced 618 billion cubic feet (Bcf) of natural gas, and consumed 2.8 trillion cubic feet (Tcf). Ukraine therefore relies heavily on natural gas imports, mostly from Russia, to meet its demand. Ukraine often pays for these imports through barter agreements, offering food, steel pipes and oil and gas equipment in lieu of cash. Ukraine imports approximately 1.8 Tcf of Russian gas per year. Ukraine also is the main transit route for Russian natural gas shipments to Europe. The country carries more than 4.2 Tcf of Russian gas through its extensive gas pipeline network. The country often will accept gas imports in exchange for transit fees for use of these lines. Meanwhile, Ukraine is looking to exploit more of its own reserves with a goal of meeting at least 50% of domestic demand by 2010. Under the Oil and Gas of Ukraine to 2010 program, the country is looking to decrease its dependence on imports by developing new wells, boosting production from existing wells, developing coal-bed methane production, and increasing foreign investment. In August 1998, the government approved a plan to breakup Ukrgazprom, a leading energy company in Ukraine and one of the world's largest gas companies, into separate companies dealing with natural gas production, transport and sales. Three companies will be incorporated under the umbrella of the new Naftogas Ukrainy. The plan is part of a World Bank-sponsored effort to reform Ukraine's gas industry and break the monopoly power on the country's gas market currently exercised by Ukraine's large gas trading houses. Coal is the only energy resource that Ukraine possesses in sufficient quantities to cover its needs for the foreseeable future. The main deposits of hard coal are concentrated in the Donetsk and Viv-Valine Basins, and the main lignite deposits are located in Dnipropetrovskaya Oblast. Total hard coal reserves (A + B + C + C categories) recently were estimated at 52.6 billion tons by two researchers at the Ukrainian Academy of Sciences, of which 31% was reported to be of coking grade and 11.5% consisted of anthracite; 48.5 billion tons (92%) of these reserves lie in the country’s main producing basin, the Donets (Donbas), which accounts for a similar share of the country’s hard coal output. Lignite reserves currently are estimated at 2.2 billion tons and are extracted from five underground mines and six open pits in Zhytomyr, Cherhassy, and Kirovohrad oblasts. Most of the 2.3 million tons of lignite mined in 1995 was used in power generation and pellet production. Ukraine's coal industry continues to be troubled by strikes, unsafe mines, overemployment, inefficiency and huge debts. As of June 1998, only four of the country's approximately 250 mines were profitable and virtually all of the mines needed to be modernized. The industry remains heavily subsidized by the government. According to the World Bank, the average production cost of Ukrainian coal is $50 per ton, compared to a world market price of $35 per ton. To close the gap, the government spent $990 million in 1997 on subsidies and is projected to spend approximately $900 million more in 1998. In addition, a recent study of the Stakhanovskaya mine by the British firm International Mining Consultants concluded that 3,200 of the 7,500 workers could be laid off with no drop in output. The study pointed out that Polish mines produce twice as much coal as Ukrainian mines with half the work force and under safer conditions. In January 1997 the World Bank approved a $300 million loan to support a program to close 20 mines per year and to retrain displaced workers. However, the program never developed, and the World Bank began renegotiating the loan in June 1998, but this time requiring fewer mine closures. Within the former Soviet Union and Eastern Europe, Ukraine is one of the largest producers and consumers of electricity. In 1996, Ukraine produced 200 billion kilowatt-hours (kwh) and consumed 187 billion kwh. Most of Ukraine's electricity comes from 14 large fossil-fuel plants, and five nuclear power plants. In 1997, about 50% of the electricity came from these fossil-fuel plants, with 40% generated by the nuclear plants. The remaining 10% came from 10 hydroelectric plants. In 1998, nuclear electricity generation started to catch up to thermal generation. Nuclear electricity currently accounts for 44.9% of Ukraine's electricity generation while fossil fuels account for 46.8%. Hydroelectricity has fallen off to 5.6%, with the remaining 2.7% provided by independent suppliers. Nuclear may even surpass thermal as the country's largest supplier of electricity if two new, currently unfinished reactors, Khmelnitski-2 (K2) and Rovno-4 (R4), are completed. Production form the thermal plants has declined due to age, plant maintenance problems, and fuel shortages. K2 and R4, approximately 85% complete, are being built to compensate for the loss of electricity generation when the government shuts down the Chernobyl nuclear complex. One reactor currently remains operational at Chernobyl. In 1995, Ukraine signed a memorandum of understanding with the G-7 countries agreeing to close the complex by 2000 in exchange for financing to complete K2 and R4. However, Ukraine has not received the $1.7 billion needed to finish the remaining 15% and has threatened to keep the Chernobyl-3 reactor running beyond 2000. In June 1998, the European Bank for Reconstruction and Development (EBRD) gave preliminary approval to a $190 million loan earmarked for K2 and R4, but EBRD may not grant final approval until the end of 1999. In May 1998, Ukraine's Ministry of Energy awarded a $760 million contract to a Bechtel-led consortium to stabilize a concrete shelter covering the damaged Unit 4 reactor building at the Chernobyl nuclear complex. The current shelter was constructed in 1986 shortly after the melt down at unit 4, but it now is considered to be unstable. In addition to securing the concrete shelter, the Shelter Implementation Plan is designed to reduce the risk of any future release of contamination into the environment and to minimize occupational exposure. The initial phase of the project will take two years and will consist of conceptual engineering, cost estimating and procurement. The entire project is scheduled to be complete in 8-10 years. Other members of the consortium include Electricite de France and Battelle Memorial Institute. Home |
| Key Facts -------------------------------------------- Boundaries Country Length of Boundary Russia 1,576 km Moldova 939 km Belarus 891 km Romania 531 km Poland 428 km Hungary 103 km Slovakia 90 km -------------------------------------------- Ethnic Divisions Ukrainian 73 % Russian 22 % Jewish 1 % Other 4 % -------------------------------------------- Religions Ukrainian Orthodox Moscow Patriarchate Kiev Patriarchate Ukrainian Autocephalous Orthodox Catholic (Uniate) Protestant Jewish -------------------------------------------- National Symbols Flag Emblem Click either the flag or emblem to learn more about them |
| Energy In Ukraine |
| • Home |
| • People |
| • History |
| • Economy |
| • Energy |
 |
|
|
 |
|
|
 |
|
 |
|
 |
|
 |
| Eastern Europe 49,811,174 603,700 km 2,782 km Temperate continental; winters vary from cold along the Black Sea to cold farther inland; summers are warm across the greater part of the country. Hot in the south. Ukrainian Russian $1 = 5.42 hryvnia New Year - January 1 Christmas - January 7 Easter - Date Varies Independence Day - August 24 |
| Region Population Area Total Coastline Climate Languages Currency Major Holidays |