A secure investment environment in the Black Sea region would make energy trade easier for Ukraine, said Volodymyr Demchyshyn, Ukrainian minister of energy and coal mining said Thursday.
Demchyshyn spoke at the Atlantic Council Energy and Economic Summit in Istanbul where he said that Ukraine's energy is not only about natural gas and oil and stressed that Ukraine is changing its direction to electricity step by step.
'In time, all energy market's structure will be changed and it will be faster than we expect. New technology and new methods could make this happen fast.'
He explained that oil and gas are normally associated with Ukraine's energy industry, but he added that the country has an incredible electricity distribution system.
'We export electricity to Slovakia and Poland, and we could do more with the right investment environment,' Demchyshyn explained.
He said that after Ukraine implemented new legislation on gas production and exploration from Oct. 1, the market was opened up to new players, 'After new players entered the Ukrainian gas market, they gained 30 percent share in the market. They supply an important share of gas to the industry in Ukraine, and we expect more competitiveness with new European companies. Regulations on oil production and exploration will also become easier in Ukraine,' he added.
- 'Is Gazprom a company or a government institution?'
Ariel Cohen a nonresident senior fellow from Atlantic Council said at the same session that the Black Sea region has many coal reserves and renewable energy potential.
'Ukraine and countries like Ukraine have big natural gas potential and reserves. Maybe they are in the wrong hands now but when we consider the situation, we see one thing: Our only problem on energy security is about depending only on one supplier,' Cohen said and added that the solution lies in geographical diversification.
Cohen noted that Western sanctions on Russia affected energy giant Gazprom economically.
'I had a conversation with Gazprom's CEO Miller and asked him whether Gazprom is a company or a government institution. He said it was 50-50.'
This shows the relationship with energy and politics. Countries such as Estonia, Latvia, Lithuania and Finland are highly dependent on Russian gas and therefore are obliged to be loyal to Russia, Cohen explained.
'When we look at history, we can see that gas prices are being used as a political tool. A safe and peaceful energy in the Black Sea region is very important for the safety of the energy market there. To ensure this security, Romania, Moldova and Ukraine can and should develop their own domestic resources,' Cohen said.
Due to the unrest in Ukraine, European powers and the U.S. have imposed sanctions on Russia last year, limiting Moscow's ability to seek investments for its energy sector in European banks and curbing the imports of technological equipment and know-how for its energy industry from western companies.
By Murat Temizer
Anadolu Agency
murat.temizer@aa.com.tr