Ukraine has substantial reserves of methane resident in underground coal seams and surrounding rock strata that, if captured, would constitute a valuable energy resource. Capture and utilization of such methane would reduce the amount of green house gas emitted to the atmosphere. Removing the methane from the coal mines will improve mine safety because excessive amounts of methane in Ukrainian coal mines is the main contributor to the high level of accidents and fatalities being experienced. This paper will provide a summary of the current methane development activities in Ukraine as well as the current economic conditions in Ukraine. METHNAE AS AN ALTERNATIVE ENERGY SOURCE During 2002, Ukraine consumed 78 billion cubic meters (bcm) of natural gas and produced domestically only 18 bcm. Ukraine receives approximately 30 bcm per year as a transit fee for the use of its pipeline system to transport gas from their Eastern neighbors to Western Europe. The shortfall of approximately 30 bcm must be purchased from foreign sources creating a negative balance of trade for Ukraine. The development and capture of the methane found at or near the Ukrainian coal mines could reduce this dependence upon imported natural gas and improve Ukraine's balance of trade with other countries. This paper will identify potential projects and outline the current status of their development. METHANE EMISSIONS INTO THE ATMOSPHERE PEER has prepared an inventory of coal mine methane emissions for the period between 1990 and 2001 that quantifies the methane emissions from coal mining activities in Ukraine. The estimates presented encompass methane released from underground mining and surface mining and take into account the extent to which such methane is captured and utilized. During the study period, coal production in Ukraine has declined from 164.8 million tonnes in 1990 to 83.4 million tonnes in 2001. This has resulted in a corresponding decrease in methane emissions to the atmosphere from 3,885.0 million cubic meters in 1990 to 1,888.4 million cubic meters in 2001. The mines captured approximately 268 million cubic meters of methane through degasification systems and used 135 million cubic meters of the captured methane. Substantial additional reductions in methane emissions can still be accomplished by further applying methane drainage and expanding methane utilization projects. METHANE AS A COAL MINE SAFETY ISSUE Ukraine has the second worst coal mine fatality rate in the World and has experienced over 4,000 coal mine fatalities since gaining independence in 1991. The major cause of the coal mine accidents that result in multiple fatalities is the ignition of the methane that is released during the mining process. Due to the economic conditions found in the coal industry, Ukraine only utilizes ventilation measures and short cross-measure bore holes to release the methane found in the coal seams and surrounding rock strata. The introduction of vertical drilling in advance of mining in combination with the drilling of long horizontal holes would improve the current hazard conditions. CURRENT ECONOMIC CONDITIONS IN UKRAINE The renewed interest in methane development projects in Ukraine can partially be explained by the improved economic conditions. For example, Ukraine has experienced a positive growth in their GDP and Industrial Output for the past two years. Also, inflation and the currency have been stable for the past two years and interest rates are declining. However, there are still many issues in the legal and taxation areas that need to be addressed to provide a more favorable atmosphere for foreign investment into Ukraine. The paper will provide a discussion of the current economic conditions in Ukraine.
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