: Ukrainian government aims to reach gas self-sufficiency by 2020

18:17 May. 20, 2016

Ukrainian government aims to reach gas self-sufficiency by 2020

Photo source: Getty Images.

State-owned gas monopoly should be divided by type of activities

Ukraine is planning to raise gas production up to 27 billion cubic metres by 2020 that must completely meet its domestic needs.

The goal is laid out in the draft plan of the government on priority measures for 2016.

Read also Gas consumption in Ukraine reduced by one-third in two years

The draft reads that Ukraine as a member of the Energy Community has carried out the requirements of the Third Energy Package concerning liberalisation of a natural gas market.

"However, a full liberalization and de-monopolization of the gas market require dividing monopolies by types of activities. Without realizing the plan of restructuring Naftogaz of Ukraine, the development of the gas market of Ukraine is impossible," as noted in the document. "The separation of natural gas transportation from the production, supply, and other activities will protect the interests of Ukrainian consumers and is essential for the country's energy security."

Read also Demchyshyn: Ukraine to cut gas imports 20-30%, EU to be only supplier

In the fourth quarter, the Cabinet of Ministers plans to introduce IT system for balancing gas per day. This should allow implementing the practice of the E.U. gas market operators regarding balancing gas and integrating Ukraine in the European market.

Watch also UT's interview with Yuriy Vitrenko, the Head of International Business at Naftogaz: Who is sabotaging the reforms?

The key steps to be implemented in the mid-term are the liquidity of the natural gas market, the restructuring model of Naftogaz Ukraine, the implementation of a virtual reverse of gas and the development of a legal framework for the creation of a gas hub in Ukraine.

Gas production in Ukraine in 2015, excluding the annexed peninsula of Crimea, decreased compared to 2014 by 3.1 percent - to 19.2 billion cubic meters.

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