The Ukrainian government's policy in the energy sector is aimed at developing the country's own production of hydrocarbons, First Deputy Prime Minister Andriy Kliuyev said in an interview with Channel 5, UKRINFORM reported.

He said that the prices of Ukrainian-produced natural gas should be brought in line with its prime cost so that companies extracting oil and gas work at the level of profitability of 8-12%.

The prices of gas produced in Ukraine were not increased for several years, and therefore "even the domestic production of gas at prices at which it was sold to the public was unprofitable," Kliuyev said. "If this industry is always unprofitable, then there should be no question about a rise in the production of own gas, and this means that the country's energy security will be thrown into question," the first deputy prime minister said.

Kliuyev said that as soon as Naftogaz of Ukraine is transferred to the profitable production of gas, gas prices for the public would not rise.

He also noted that the government was working to launch the production of shale gas and methane gas in Ukraine.

The first deputy prime minister noted that Ukraine currently produced around 20 billion cubic meters of gas per annum. "I think we will increase this volume by at least 1.5 times. Then, our stability will also be strengthened - in fact, using our own production, we can ensure the needs of the public and housing and utilities enterprises," Kliuyev said.

The price of gas for the public and heat supplying companies rose by 50% from August 1, 2010.

A rise in gas prices was one of the conditions for the resumption of Ukraine's cooperation with the International Monetary Fund.

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