Ukraine's potentially vast supplies of unconventional natural gas could close the strategically located country's energy supply gap by 2020, though this will only be achieved if authorities speed up and rationalize the regulatory process to allow development and production work to begin, the chief executive of TNK-BP Ltd.'s (TNBP.RS) Ukraine division said Thursday.

"It is possible to close the gap between production today and supply in the future by 2020, 2023. But we need to follow through on going in and drilling the wells, going into production," said Didier Casimiro, adding that "time is of the essence" if the goal is to be achieved.

Ukraine's eastern Donetsk region may hold considerable shale deposits, an unconventional source of natural gas produced by a method known as hydraulic fracturing.

TNK-BP, a joint venture between U.K. supermajor BP PLC (BP, BP.LN) and a group of Russian billionaire investors, has said it is targeting licenses in the country and that it may spend $50 million on exploration in Ukraine over the next few years.

However, Casimiro said Thursday that the company was still waiting for issues around the licensing process to be resolved.

"As soon as there could be an auction licenses, we will certainly participate," he said.

"We used to have a time frame, but that time frame has moved a number of times," Casimiro said, adding that the company had hoped to drill its first well this year.

Shale has shaken up the U.S. gas market in the past two years and caught the interest of major players on the European market. U.S. giant Exxon Mobil Corp. (XOM) signed a memorandum of understanding with Ukraine's state-owned firm, Naftogaz, to explore for shale deposits in February, while Royal Dutch Shell PLC (RDSA, RDSB, RDSA.LN, RDSB.LN) and Chevron Corp. (CVX) have also expressed their interest in the region's gas potential.

-By Alexis Flynn, Dow Jones Newswires, +44 207 8429471, alexis.flynn@dowjones.com