JSC Ukrgasvydobuvannya plans to start drilling two horizontal wells in 2023, the company’s CEO Oleh Tolmachov said.
“We will start drilling the first two wells this year. We will see the results in 2024. We are working on the technological design of such wells,” he said in an interview with NV.
According to him, horizontal drilling will require additional pumps and other specific points, as well as the import of certain technological solutions. “But 85-90% of the equipment that will be used in this process is already in operation at Ukrgasvydobuvannya,” Tolmachov said.
The UGV CEO estimates the cost of drilling a vertical well with a depth of 4000 meters at about $5 million, while a horizontal well costs more than $25 million.
“But the latter allow us to get high gas flow rates even from tight reservoirs. Ukraine is now in the same situation as the US and Canada were in the late 90s. Our fields are depleted by more than 80%. That’s why we have to drill such unconventional wells, which are more expensive and technologically more complicated. But they produce much more gas,” he said.
Tolmachev believes that investing in gas production in Ukraine is an attractive story, as the price of gas in Europe is 5-6 times higher than in the United States.
“At the same time, Ukrainian projects are similar to those that investors in the United States, Canada, and Saudi Arabia work with. But in terms of economic indicators, they should look much stronger here. So I think foreign partners will be interested in joining Ukrainian gas production,” he said.
According to him, the company has signed protocols of intent with two North American companies, with whom consultations will be held on how to adapt American technologies to Ukrainian realities and technical issues.
“We are also working to gain access to various grants and funds in the US and EU that they allocate for Ukraine. The goal is to present a ready-made story, a financial model with a clear mechanism for field development immediately after the victory, so that foreign companies can invest in Ukrainian gas production,” Tolmachov explained.
As reported, Ukrgasvydobuvannya aims to increase its own natural gas production by one billion cubic meters in 2023 – up to 13.5 billion cubic meters.
“In 2022, Ukrgasvydobuvannya, 100% owned by Naftogaz of Ukraine, produced 12.5 bcm of natural gas (commercial), which is 3% less than in 2021. In 2023, the company plans to increase drilling by 1.5 times compared to last year – up to 300 thousand meters.
