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Ukraine overthrows Yanukovych amid US/Russia power struggle over natural gas

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The popular uprising in Ukraine has resulted in ex-President Yanukovych fleeing the capitol on Saturday, apparently retreating to the safety of Kharkiv, a city in Russia-friendly Eastern Ukraine. While it's extremely historically significant that a popular uprising has overthrown a Russia-backed government, the events also illustrate a global power struggle centering on natural gas supplies, hydraulic fracturing, and Europe's reliance on Russia for natural gas.

Ukraine is not only a key linkage point between Europe and Russia, the country also has significant shale deposits from which shale gas can be extracted through fracking (a.k.a. hydraulic fracturing). Coincidentally, the two regions of shale deposits, centered around Lviv in western Ukraine and Kharkiv in the east, happen to be key cities in Yanukovych's overthrow. Lviv freed itself from rule by the central government months ago. Further, the platoon of police officers who "defected" on Friday, joining the protesters, were from Lviv. Kharkiv is the city to which Yanukovych has fled, and which was the scene of an assembly of regional political bosses who have voted to reject actions by the Parliament.

The crisis in Ukraine began a few years ago when Russia cut off gas supplies to Europe because Ukraine had raised trans-shipment fees. Ukraine houses several natural gas pipelines that have historically linked Russia and Europe, and through which Russia supplies Europe with most of its natural gas. Since then, Russia has begun work on two pipelines, Nordstream and South Stream, which are meant to bypass the pipelines going through Ukraine, letting Russia directly sell natural gas to Europe.

At the same time the US State Department set up a program, the Unconventional Gas Technical Engagement Program, whose purpose is to export hydraulic fracturing technology to countries all around the world. One focus of the program is also to help Europe free itself from dependency on Russian natural gas. The pattern followed by the UGTEP is to start by educating governments about the benefits, downplaying hazards, while assessing regulatory requirements in each country. An example is a USAID document, UKRAINE SHALE GAS: ENVIRONMENTAL AND REGULATORY ASSESSMENT, assessing the possibility of exploiting shale gas deposits in Ukraine. The document was meant to prepare the Ukranian government to exploit their shale gas deposits, or specifically:

  1. Help the government of Ukraine to develop an environmentally sound framework for pursuing shale gas development
  2. Develop more refined environmental reviews for shale gas development
  3. Develop improved regulatory approaches
  4. Assist in the development of more transparent and efficient contract tendering

Therefore, the US Government's goal is to develop shale gas in Ukraine using Hydraulic Fracturing. The task is very expensive, well beyond Ukraine's financial capabilities, leading the country to seek financial aid from either the European Union or Russia. In January 2013, Ukraine signed a deal with Royal Dutch Shell allowing that company to begin exploratory work ahead of fracking operations, and in November 2013 Ukraine signed a similar deal with Chevron. Meaning that Western powers were making progress in Ukraine, until the country performed an about-face and embraced Russia.

The crisis began when Ukraine chose to partner with Russia rather than the EU. That pitted the West (US and EU) against Russia in a battle for dominance over Ukraine.

The protesters in the street were angered by that turn of events, preferring to partner with the EU rather than Russia. Now that the protesters have succeeded in removing Yanukovych from power, the door is open to Western powers reasserting the control necessary for Western oil companies to go about the job of Fracking Ukraine. Unless the country dissolves into a civil war.



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