Multinational chemicals and energy group Shell is thought to be close to clinching a landmark deal to exploit shale gas reserves in Ukraine. According to the U.S. Energy Information Administration, the east European country has the continent's biggest deposits, totaling around 1.2 trillion cubic meters. An announcement was expected on the fringes of the World Economic Forum in Davos, Switzerland.

Ukraine's government said that if a pact covering the Yuziviska region is sealed, exploitation could begin within five to six years, with output expected to rise to 8-10 billion cbm within 10 years and exceed 20 bn cbm in 13 years' time. Meanwhile, an agreement reached with oil-petrochemicals group Chevron for Olesska in western Ukraine in May 2012 may be running into local opposition on ecological grounds, reports say. Ukraine is seeking to become independent of Russian gas imports.

Huntsman speaks out against gas exports
In the U.S., shale gas is redrawing the energy and petrochemicals map. Large chemical companies such as Dow with access to shale gas-generated ethane feedstock are increasing their competitiveness against European players and are envied by rivals across the Atlantic. Plans by major European players such as Ineos to import U.S. natural gas are sparking opposition in some quarters.

U.S. chemical producer Huntsman said recently it had joined a coalition of manufacturers and others opposed to proposals to permit unlimited exports of shale-derived natural gas. The financially struggling company is planning to expand its operations at home to benefit from shale gas. It has committed more than $150 million to new projects while at the same time evaluating other projects worth an additional $250 million.

CEO Peter Huntsman said he thinks it is "short-sighted and bad public policy" to jeopardize the country's natural gas advantage, which has tempered its energy price volatility "dramatically," to build manufacturing basis overseas that could otherwise be built in the U.S.