Maksym Bielawski, a leading expert at Razumkov Centre and former PR director at the Naftogaz Group, says that Naftogaz previously held talks with Halliburton, ExxonMobil and Chevron, but these talks were put on hold after the start of the full-scale Russian invasion.
"Now, the negotiations that took place earlier are actually being resumed. They concern joint development of new deposits, as well as more efficient use of the exhausted ones. In addition, there is talk about the employment of new technologies and services, which will make it possible to reduce losses and expenditure of natural gas during the operation of the existing wells. However, there is one point here: if ExxonMobil and Chevron have not yet stopped their cooperation with the aggressor state, they should do it now. Only after that, in my opinion, there will be sufficient grounds for cooperation between Naftogaz subsidiary companies and said foreign leaders in the field of hydrocarbon production," says Bielawski.
In his opinion, the very news that the Western giants resumed negotiations on the background of total sanctions and departure of such companies from Russia shows that even the oil and gas giants have no doubts, who will be the winner. However, even if such negotiations take place, this does not mean that investments will come tomorrow or the day after tomorrow.
"There is a signal that Naftogaz can fight for investors even in the extremely difficult conditions of martial law. But Ukraine also has a lot of homework to do for investors to come to the country and the investment portfolio to grow," the expert says.
Among such tasks, Bielawski mentions completion of the reform of subsoil use. First of all, he means that special permits for the use of subsoil should be issued transparently. Also, Ukraine needs a subsoil code that will harmonise the domestic legislation on subsoil use with the European norms. In addition, according to Bielawski, in order to win investors, Ukraine should lower the rent for the subsoil use.
“The current model of rent was developed shortly before the invasion in 2022, at a time when Europe had an energy crisis and gas prices were quite high. But given the current conditions and gas prices in Europe and in Ukraine, the current rates of rental fees actually kill any interest in this type of business," says Bielawski.
Bielawski also said that the history of Ukraine's relations with the oil production giants began back in 2012, when negotiations were started about joint production of gas from dense rocks, or so-called "shale gas". However, after the annexation of Crimea and the start of the war in Donbas, "shale gas" production projects were suspended, primarily due to security risks, since the most promising areas were located in Kharkiv region. The expert still believes that the joint projects of Naftogaz and Western mining giants will provide an opportunity to strengthen Ukraine's defence capabilities in the future.
The expert says that companies such as ExxonMobil and Chevron can become donors for the purchase of weapons, protection and fortification systems for the oil and gas industry facilities.
"For example, if you look at the oil and gas industry facilities in Israel, which will export fuel to the European market in the coming year, the defence industry fairly closely cooperates with the oil and gas sector. Therefore, large companies should be encouraged not only to make direct investments in the oil and gas sector but also to invest in the defence industry, in the form of either weapon systems or grants. So I believe that with the arrival of international oil and gas giants, investments in the sector will be supplemented with funds for weapons, for the defence of the relevant deposits," Bielawski says.
