Ukraine hopes to rejuvenate its oil and gas sector — and wants Canada to help

Ukraine's largest oil and gas producing company hopes to end the country's reliance on petroleum imports — and wants Canadian businesses to pitch in. 

Ukrnafta executive vice-president Denys Kudin is in Canada this week in between stops in Vienna, Washington D.C. and Houston, courting investors willing to help the country rejuvenate its mature oil fields. 

"We believe that it's not only a good thing to do, but it's also something that can bring you some commercial reward," said Kudin, speaking to CBC News on the sidelines of this week's Global Energy Show in Calgary.

On stage and in private conversations, he's pitching it as an opportunity to get in on the ground floor of a promising oil market while helping Ukraine achieve energy independence — a long-held goal that's become more urgent amid the country's war with Russia. 

But Kudin faces the challenge of convincing investors to put up money for development in a country at war, at a time when climate concerns have made oilpatch investment a tougher sell around the globe.

Despite having its own hydrocarbon reserves and a century-long history of oil and gas production, Ukraine still relies heavily on imports of these products from other countries.

At the outset of the war, Kudin said the country was importing the bulk of its oil from Russia, Belarus and, to some degree, Poland, and has since scrambled to find new supply chains.

"In one day we had to change logistics from east to west, and it was very challenging because the infrastructure was not ready," said Kudin, who was formerly Ukraine's first deputy minister of economy. 

"As the short-term solution we found to bring diesel and petrol by cars, which puts a huge premium on the price and that's all on the shoulders of the customers."

Years-long conflict in the Donbas region has also severely curtailed Ukraine's coal production and transportation. All of this means the country is in the urgent position of needing to ramp up its domestic energy production. 

For Ukrnafta, which was taken over by Ukraine's government last fall under wartime law, a key part of that plan is to redevelop 20 mature oil brownfields in the country's west and north-east. These fields are currently out of operation but still have large oil reserves, Kudin said. 

Kudin contends they're also far enough away from the active conflict zone to be a safe place to invest. The immediate goal of the project would be to use the oil within Ukraine, rather than exporting it abroad. 

The project is expected to cost $1 billion US in capital investment a year, he said. Ukrnafta has raised about $250 million US so far, but needs partners to help fill in the gap.

"We believe Alberta to be the oil and gas capital of Canada, so we believe that this is the most appropriate place to visit, and we're happy to say that Canadian companies are quite favourable to our offer now," said Kudin.