Oleksandr Katsuba: missiles, personnel shortage, and "dormant" licenses — what's happening with the gas industry

Four years have passed since the start of the full-scale invasion. Ukraine's gas industry has learned to operate under constant risks, but new challenges have emerged: from personnel shortages to a global logistics crisis. We discuss how private production survives and why "energy independence" has a bitter taste with Oleksandr Katsuba, owner of the company "ALFA GAZ."

Oleksandr Katsuba is a person who has seen the system from the inside (as Deputy Head of NJSC "Naftogaz of Ukraine") and is now building his own private production. In our extensive interview, he discusses why Ukraine has not yet become a "European Norway," how businesses protect their facilities amidst constant attacks, and why the "2050" strategy currently looks like science fiction.

Economy of Risk

Over the past two years, the gas sector has transformed into a zone of constant operational extremism. Shelling of infrastructure has become routine, and investments in security are a mandatory condition for survival.

— Oleksandr, we are in 2026. Four years of the great war have passed. How has the market structure transformed during this time? Has gas production in Ukraine not become a "charity" given the astronomical costs of autonomy and protection?

OK: The market structure has demonstrated remarkable resilience. Globally, nothing has changed: there are top 5 major players who hold the main volume. They continue to drill, invest, and conduct seismic exploration. The market has clearly segmented by the psychological type of investor. Those who believed in the country and had assets here before the invasion continue to work. Those who were afraid to enter earlier are even more afraid now. A simple law applies here: the higher the risk, the larger the potential check. But this is a check that must be fought for in conditions of military chaos.

— Security is now a key issue. Which technological solutions — anti-drone systems, concrete "sarcophagi" — have proven most effective for protecting fields?

OK: There is no such thing as full physical protection for a gas facility. You cannot guess where the next missile will land. Shelling occurs on average once every two weeks. It's like throwing lit firecrackers at a gas station where open fuel cans are standing. We deliberately abandoned our own anti-drone systems. Why? Because such a system itself becomes a magnet for missiles. Moreover, the bureaucracy in this matter is still impenetrable: you need to attach a military unit, get piles of permits... The state has not yet offered a transparent mechanism for how businesses can officially buy a "subscription" for air defense protection (laughs).

— So how do you protect people and production?

OK: Our recipe is concrete and duplication. At each installation (UCPG), we have built full-fledged bomb shelters. This is the base. As for equipment, we have switched to a "double stock" strategy. Since the manufacturing time for equipment has increased from 3 to 11 months, we maintain a 100% reserve. Roughly speaking, if a working "machine" is at the field, then an identical new one is in disassembled condition in the garage. If there is a hit, we simply reassemble the object from scratch. We look at the sky, pray to God, and keep spare equipment at hand. There is no other way out in 2026.

Resource Potential: Myths of Independence and "Sleeping" Riches

Ukraine has been reporting "energy independence" for virtually the third year due to the absence of gas imports. However, behind the beautiful figures lies the alarming reality of industrial giants shutting down.

— Ukraine has been reporting independence from gas imports for the third year. Is this a sign of strength or a symptom of our industry's illness?

OK: Firstly, there was some import this winter after all. Secondly, unfortunately, this is about a patient in a coma. Yes, we practically do not buy gas abroad, but this is not because we have started producing many times more. This is a consequence of the stagnation of large industry. When there is no electricity 50% of the time, factories simply do not consume gas. 

— Which industries have most affected consumption? 

OK: Chemical plants, metallurgical complexes — they are either destroyed, frozen, or operating at a minimum. No new large factories have opened in four years. We are "independent" only because our economy consumes significantly less than it could in peacetime.

— You have repeatedly called for a revision of 200 "sleeping" fields. We are in 2026 — has anything changed?

OK: Practically nothing. This is my biggest pain for the industry. More than 200-300 licenses remain "sleeping." Their owners do nothing: no drilling, no seismics. These are simply "paper" assets. The revision, which was talked about so much, only happened formally. From inside the market, we clearly see who is really working and who is just holding a piece of paper hoping for resale. The state needs political will — to withdraw these licenses and put them up for open, transparent auctions. The top 10 players in the market are ready to buy them tomorrow, invest money, create jobs, and provide real gas to the system. So far, there is no such impetus.

— What about the Black Sea shelf? Is there hope of returning to offshore production?

OK: To be realistic, we can forget about the shelf in the coming years. And it's not just about mines. We don't have our own fleet, no offshore drilling rigs, no aviation for logistics. Everything that Chornomornaftogaz had either remained in occupied Crimea or was destroyed. Today, Chornomornaftogaz is an office in Kyiv without real capacities. To start production near Odesa, we need to build all the infrastructure from scratch. That's billions of dollars. Ukraine does not have such gigantic deposits as Norway for it to pay off quickly. An investor will not go where the cost of production exceeds the market price of gas.

The World Against Ukraine?

The global confrontation between the US and China and the internal demographic crisis create new challenges for Ukrainian subsoil users.

— How does the rivalry between the US and China affect your business? Do you experience a shortage of equipment or electronics?

OK: Politically, this rivalry hardly affects us, but logistically, it's a nightmare. Previously, delivery of a compressor from the US took a month, now it's four. We have learned to maneuver. For example, we buy Chinese pipes — and there are no questions about their quality. We get electronics where they are available faster. Business adapts. The main problem is not whose equipment it is, but how to deliver it through blocked or complicated borders.

— What about people? Where to find engineers and drillers when mobilization is ongoing in the country?

OK: This is a critical issue. But I noticed an interesting trend: mass migration abroad stopped after the first year. Those who wanted to leave have left. The rest stayed. Our entire industry has been under reservation from day one, so we retain personnel. But now a large "internal migration" has begun — from state-owned companies to private ones.

— Why are specialists fleeing from "Ukrgasvydobuvannya" or "Lvivgasvydobuvannya" to you?

OK: Because private business offers not only a higher salary but also a different culture. We offer a horizontal structure where there is no bureaucracy and "work for the sake of work." A young engineer wants to see results, not write reports for officials. We have developed direct communication, a clear career ladder, and no rigid hierarchy. This is our main trump card in the fight for talent.

Business, Communities, and the Future of Energy

The gas business is often viewed with suspicion by communities. However, extractive companies have become the main donors of local infrastructure during the war, and energy development is increasingly perceived as a security factor. 

— Has the industry become cleaner? Have the schemes of "manual" license distribution, which you warned about earlier, disappeared?

OK: The industry has become globally clean. The auction system really works: the one who offers a larger check wins. No "hidden pitfalls." New licenses are bought by adequate market players. The only problem is those old "sleeping" assets I mentioned. Transparency is still lacking there.

— How does your cooperation with communities look like? Are people still afraid of hydraulic fracturing?

OK: We work mainly in the Poltava region, and I can say that gas has become "socially acceptable." We build roads, repair schools, and help communities. And these roads are high-quality, they serve for years. As for ecology, I personally monitor every object. This is my country, I'm not going to litter here. Myths that water disappears in wells or birds die due to hydraulic fracturing are just fairy tales for the uninformed. We work according to the highest standards because we live here.

— "Strategy-2050" — you called it abstract. What is your plan for 2030?

OK: A 30-year strategy in a country where the planning horizon is a week seems strange. The plan for 2030 is more achievable and should be extremely simple. First, a revision of subsoil: transfer all non-working licenses to real investors. Second, deregulation: simplify connection to networks. Currently, an investor can wait a year for electricity connection to a new facility. This is absurd. Third, energy efficiency: insulation of houses, heat pumps, biofuels.

— The question of gas prices for the population. Is it time to switch to the market in 2026?

OK: This is a very painful issue. About 15% of working-age men are at the front, women are raising families alone, and about 40% of the adult population are pensioners. Switching to a full market now would be a social explosion. It is the responsibility of the government and parliament to find a balance between subsidies and market prices. My task as a businessman is to drill, extract, and honestly pay taxes. Political decisions are up to the authorities.

— You help the Armed Forces of Ukraine a lot. You said it was the best investment. Why did you focus on cars?

OK: I have a media business — "AutoCenter." We know everything about cars. In 4 years, we have transferred over 130 vehicles: from pickups to trucks and engineering equipment. The needs of the army change daily, but "wheels" are always needed. Every hryvnia invested in a car for the Armed Forces of Ukraine is a guarantee that my business and my country, in general, have a future. If there is no Armed Forces of Ukraine, there will be no gas, no licenses, no strategies. This is the only axiom of 2026.