Losing Crimea Could Sink Ukraine's Offshore Oil and Gas Hopes

Without Crimea, Ukraine looks set to lose an important piece of its economic and energy future: valuable undersea oil and gas fields that lie just offshore the Crimean peninsula. Exploiting those Black Sea fields could help reduce Ukraine’s dependence on Russian gas imports.

And Big Oil had been interested: Before the overthrow of former President Viktor Yanukovych, Ukraine was on the verge of signing a deal with a group, including Exxon Mobil and Royal Dutch Shell, that was prepared to spend $735 million to drill two wells off Crimea’s southwest coast. “Exxon and Shell are now in a legal limbo,” Chris Weafer of Moscow investment group Macro Advisory told Bloomberg News. If Crimea votes in a March 16 referendum to secede from Ukraine, the government in Kiev “may soon no longer have jurisdiction over the region.”