Cadogan’s oil and gas activities are located exclusively in Ukraine, a country which is characterised by its increasingly high demand for energy and in particular for natural gas. Approximately 20 Bcm of Ukraine's energy needs are produced domestically, with 55 Bcm imported from abroad. Approximately 75 to 78%. of Ukraine’s energy needs are currently met by imported oil and gas from Russia and Turkmenistan with 22 to 25%. met by Ukraine’s domestic production. Ukraine has significant hydrocarbon sources estimated around 39tcf of gas and 395MMbbl of oil, many of which are yet to be exploited. The price at which Russian gas is sold to Ukraine has tripled since 2005. As such the economics of developing domestic resources has improved significantly and the Ukrainian Government has also established a policy of encouraging domestic production and encouraging foreign investment in this area in order to reduce the country's dependence in imports.