Great East Energy's Position Strengthens in Ukraine With Russia's Threat to End Discounted Natural Gas

NEW YORK, NY--(Marketwired - Mar 13, 2014) - Great East Energy, Inc. (OTCQB: GASE) and companies like Royal Dutch Shell and Chevron are welcomed entities in Ukraine these days. As the crisis continues to play itself out between Ukraine and Russia through its state-owned gas company, Gazprom, Great East Energy's assets in Ukraine seem to be gaining in value and the company's position there is strengthening as well. And, it all starts with its estimated gross total reserves of 47 billion cubic feet (BCF) of natural gas in its 162-square mile licensed area. 

These reserves are likely to return a great deal of revenue to the company as it produces and sells that natural gas to its customers, but Great East Energy's revenue could be greatly enhanced if Ukraine is forced to pay much higher prices for natural gas coming from Gazprom. The Russian gas company has threatened to raise the price it charges Ukraine for its gas from $7.70 to around $11.50 per 1,000 cubic feet. 

This dramatic rise in price gives Great East Energy, Royal Dutch Shell, Chevron and others a strong hand to play as these companies begin to introduce more capital, technology and industry knowledge to produce more natural gas. Gazprom supplies more than half of the gas Ukraine uses each year, but as the country moves toward energy self-sufficiency from Russia, it will look to these new companies to supply it with much needed gas in an effort to push Russia and higher prices away. 

With Great East Energy's estimated reserves, it could join other companies to supply Ukraine some of that shortfall at its current discount from Gazprom, and generate almost $362 million. The company could supply gas closer to the high end of the scale, and match Gazprom's threatened prices and generate over $540 million. 

So, as Royal Dutch Shell pours in over $400 million to explore its assets there, Great East Energy can continue to produce as it has since 2003 in its own licensed area right next door to Shell's property. But, in a country with an estimated 40 trillion cubic feet of recoverable shale gas or enough to satisfy the country's demand for decades, Great East Energy will do so with an eye on the price of natural gas from Russia.

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