Reliance Industries Ltd., a wholly owned subsidiary of Reliance Exploration and Production, has secured a production-sharing agreement with the Yemeni Oil Ministry to explore two blocks in Yemen.

The exploration blocks numbered 34 and 37 are located in the Jeza basin of eastern Yemen. In both blocks, Hood Energy will partner Reliance Industries with 30 percent participating interest, according to a Reliance Industries statement.

The project consists of conducting seismic survey and drilling exploratory wells based on comprehensive geological and geophysical studies, it said.

The agreement was signed by Yemen's deputy oil minister and Reliance Industries representative Atul Chandra.

Reliance Industries has been present in Yemen since 2001 when it was allocated block number 9, where substantial reserves of hydrocarbon have been established. Reliance Industries and Hood Energy hold 25 percent stake each in this block, and Calvalley Petroleum Inc., with 50 percent, is a partner in this joint venture.

Russia could face natural gas shortage

Planned generating and other industrial facilities in Russia may cause serious domestic shortages of natural gas between 2010 and 2015, said Andrei Klepach, director of the macroeconomic forecast department of the Economic Development and Trade Ministry.

"There already exists a danger of gas shortages. It may become particularly acute (in) 2010-2015 given the planned scale of launching new generating facilities, new cement-manufacturing facilities, where the capacity is planned to practically double. All this will naturally require a lot more gas," Klepach told Interfax.

"To overcome those risks, we really need new large-scale projects and a substantial increase both in the production of gas and electricity. The Guidelines are based on quite detailed calculations on the dynamics of electricity consumption and gas production," he said.

Targets and a gross domestic product increase of more than 6 percent annually as proposed in an innovational scenario are impossible to achieve via an increase in electricity generation alone, as there is a long-term target of a little less than 4 percent a year for an increase in electricity production and a target of between 1 percent and 1.5 percent a year for gas production growth, Klepach said.

Shell mulls investing $360M in Ukrainian gas condensate

If Shell Exploration & Production Ukraine Investments BV acquires a 51 percent stake in Regal Petroleum (Jersey) Ltd., a subsidiary of Regal Petroleum Plc (OTCBB:RGPMF), for $50 million it could secure a contract to develop two gas condensate fields in Ukraine.

Regal Petroleum (Jersey) Ltd. indirectly owns licenses for the development of the Mekhedivsko-Holotovshchynsky and Svyrydivsky gas condensate fields in Ukraine, in which Shell could invest $360 million, Regal Petroleum said in a statement. The companies have signed a corresponding memorandum on the investment.

The deadline for talks with private British oil and gas company MND Exploration and Production Limited, which in September signed a memorandum on mutual understanding on the investment of $330 million in these fields, expired without an agreement being signed, the statement says.

The new memorandum with Shell states that talks will be held on investment in the fields within eight weeks. Shell's proposal is better than the previous one made by MND, Regal Petroleum CEO Francesco Scolaro said.

He said the acquisition of a 51 percent stake in Regal Petroleum would provide the company with the opportunity to work in the upstream sector in Ukraine. The transaction has basically been approved, and only the final documentation needs to be registered, he said. According to the agreements, Shell will be the operator of two Regal fields in Ukraine, he said.

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Closing oil prices, Nov. 27, 3 p.m. London

Brent crude oil: $93.63

West Texas Intermediate crude oil: $95.49

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(e-mail: energy@upi.com)