ANKARA
As gun battles in eastern Ukraine continue this week, the country is being forced to deal with its energy issues in tandem with rising violence between government forces and pro-Russian separatist rebels.
Fighting on two fronts, Ukraine has been trying vigorously since last year to decrease its dependency on Russian natural gas and to diversify its energy portfolio.
However, unrest in Ukraine has affected gas research activities in the country as Western companies suspend activities, something which is threatening serious repercussions for the economy.
Shell, the second-largest company by revenue in the world, has temporarily suspended its operations whereas Chevron is still waiting for "necessary conditions" to be met.
Shell announced in early June that its shale gas operations in eastern Ukraine, which began last year, were to be put on hold due to safety concerns for its personnel in the region.
Although there was speculation that Shell ceased its operations due to economic viability, a spokesperson at the firm's Dutch headquarters told Anadolu Agency the only reason was the current instability in Ukraine.
"We are following the situation in eastern Ukraine. The reason for the suspension of explorations was the current situation in Ukraine," he said.
Shell and the Ukrainian government previously signed a production-sharing agreement for an 8,000 square kilometer area called the Yuzivska site, located near the eastern city of Kharkiv.
Ukraine has Europe's third-largest shale gas reserves at 42 trillion cubic feet, according to the U.S. Energy Information Administration.
However, Ukraine still needs to develop those reserves in order to decrease its dependency on the Russian gas.
Over the years, there have been many disputes between Ukraine and Russia due to natural gas supplies and prices, and most recently over debt.
While Ukraine's unpaid gas debt to Russia is more than $5 billion, the crisis in Crimea has intensified problems between the two countries.
As the world has focused on the Western sanctions imposed on Russia, the desire of Ukraine to liberalize its energy economy to integrate itself to European markets is often overlooked.
Cooperating with Western energy companies to explore shale gas has been accompanied by talks about opening Ukraine's natural gas pipeline network to Western investors.
Ukraine passed a law last week which allows Western firms to buy up to 49 percent of state-owned oil and gas company Naftogaz, which also operates the gas network.
Meanwhile, Chevron, the U.S. energy company that is active in more than 180 countries, is waiting to begin shale gas exploration activities in western Ukraine.
Chevron signed a production sharing agreement with the Ukrainian government for exploration and production in western Ukraine, near the city of L’viv. The company signed for a 1.6-million-acre field, named Oles'ka Block, in November 2013.
Just three months later, social upheaval erupted in Ukraine, crippling government capabilities, something which undoubtedly affected exploration projects in the country.
The production and sharing agreement between Chevron and the government of Ukraine covers a term of 50 years, with the initial five years devoted to an exploration phase focused on acquiring seismic data, plus the drilling of exploration wells, according to Cameron Van Ast, Chevron's External Communications Advisor for Onshore Europe.
"There are certain conditions related to the adoption of legislation and regulations that will need to be satisfied before we can begin exploration activities," he said. "The adoption of legislation and regulations is not related to the current situation in Ukraine."
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