Cold War V 2.0 : The Gas War ?


Ukraine’s political crisis needs no introduction now. It’s on the papers, TV, Web, everywhere. Ever since the Orange Revolution in 2004, there hasn’t been a public opposition on a larger scale. But things changed by year end, last. The cause of the crisis was explained to be the double stands of the people, one camp wanting to join Ukraine with the EU that the pro-Russian supporters disapproved. Kiev became the epicenter of the revolution with the agitators taking control over the government buildings. The now ousted president Viktor Yanukovych is supported by Kremlin.


Russianforces in Ukraine


The revolution became more twisted and the political unrest deepened while Crimea opted for reunion (Crimea became a part of Ukraine only since 1954) with Russia (Arun Kumar’s two part article you read for the past two days sheds light on Crimean Crisis). Putin has obviously taken special interest over the Crimean issue, the Russian forces amassed in the Ukrainian border proves it. The global police US which had busy days dealing with Syrian crisis by the beginning of this year has started showing its interest in the issue. White house has warned Kremlin to stop invading Ukrainean land and not to make the situation worse. (Obama in his press address notified, what sounds to be,  that people of Crimea have the right to choose, but the choice should never be brought by force.) Neither US might willingly approve of the Crimean Referendum last Sunday.


O&G Majors in Ukraine


To uncover the truth, the sudden interest shown by these Cold war enemies on the Ukrainian Crisis we need to list down something that is remote to what popular media reiterates as the reasons for the origin of the ongoing revolution. We are about to trace a time line of events in the past few months, what might appear totally disconnected from the topic in discussion.


Gas Fields


Why these cold war foes should show special interest in Ukraine Crisis? You might know Uncle John’s motive behind the drive. In the past US invasions have resulted only from it’s ever hunger for energy resources. All the US intervention episodes in Iran, Libya are standing testimonies for this open secret. Ukraine has one of the largest proven natural gas deposits in the world beneath its soil. Back in January 2013, Shell Oil Company a subsidiary of US based Royal Dutch Shell, explored Ukrainian land and found 4 Trillion cubic feet of shale gas reserves ( Shale gas is nothing but natural gas trapped in Shale formations).

On 24th January, 2013 Reuters reported that Royal Dutch Shell was about to signed a 50 year deal with over shale gas sharing agreement with Ukraine. This eventually might have resulted in a $10 billion FDI, the largest ever for Ukraine. The commercial production is though planned by 2017, depends on the results from Shell’s 15 test wells, it was said. However things changed this January, when Shell officially announced its pull out from the talks with Ukraine as the company saw no progress. It was also a bad news for Ukraine for it depends on Russia for the gas requirements.

Another company interested is Exxon– yet another American company. Exxon too has put on hold all its exploration projects in Ukraine until further notice. Exxon dilemma is mainly due to the Crimea crisis, as it is specifically interested in Skifska field in the Black Sea. Now as Crimea has opted for the reunion with Russia, its predicament has been justified.


Gas Pipelines


Due to the geographical proximity of Ukraine, it plays a key role in oil and gas exports and transportation from Russia to European nations. The pipelines which carry the Russian oil and gas fetch a good $3 billion as transit fee for the export service offered. Now the Crimean referendum has deprived Ukraine of the Black Sea gas. With the reunion naturally all the geographical assets of Crimea are now of Russia’s.

This article doesn’t aim at declaring conclusions, instead aims at highlighting the backgrounds of both the sides, an attempt to show the two sides of the coin. What would happen in the following days might just be based on the “Probability of Power Politics”.


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