This article is part of our special report Poland: Ambitious achievers.
SPECIAL REPORT: There are 65 shale gas wells and drills in Poland, more than any other European country. The UK, the other EU member state with plans to develop the resource, has only a couple of wells.
Poland plans to build 50 new shale wells every 12 months over the next few years but currently, the focus is more on exploration than exploitation. It has granted 82 concessions to prospect for unconventional hydrocarbons, 72 of those are shale gas related.
Officials have shown EurActiv proof of the scale of the country’s ambitions. [See the full list of concessions]. The companies who won concessions are Chevron, PGNIG S.A., Polski Koncern Naftowy Orlen S.A., Grupa Lotos S.A., Petrolinvest S.A., Winsent Oil & Gas Plc, San Leon Energy Plc, LNG Energy LTD, ConocoPhilps B.V., Moorfoot Trading Limited, Cuadrilla Resources Limited, BNK Petroleum, BNK Poland Holdings B.V., Kaynes Capital S.a.r.l., Mac Oil Spa, Basgas Pty Ltd.
But officials also insist Warsaw is committed to meeting EU legal and environmental stands in shale gas development.
The European Commission tabled several recommendations concerning shale gas on 22 January, after EurActiv revealed the draft text.
“We are very devoted to applying those recommendations, we are doing pretty much what we can to apply those recommendations to the maximum extent possible,” said a Polish expert who asked not to be named.
He said that all the 65 exploratory wells were monitored and that there was no evidence of any pollution or soil contamination.
No single solution
The Polish view is that there is no “one-size-fits-all” EU solution because the characteristics of wells vary significantly. Expects believe specific conditions should be taken into account.
Poland has amended its geological and mining laws to reflect the EU’s recommendations. New legislation concerning the granting of concessions, the performance of concession and strengthening concession and mining supervisor have been passed in months rather than the years it usually takes to amend laws.
The EU is lagging behind in shale gas research because there are not many shale gas-related construction sites. Warsaw is reportedly putting pressure on the Commission to produce a report from several construction sites about every environmental aspect of prospecting for shale gas.
It is expected to be ready by the end of the year or the beginning of 2015, EurActiv was told.
Several public information campaigns about shale gas were conducted in Poland. Opinion polls in 2013 showed that 73% of Polish citizens are in favour of shale gas, a very high figure by international standards.
Poland also insists that EU legislation should not put unnecessary burdens on energy companies.
Asked about a recent ruling by the European Court of Justice casting doubt on the legality of shale gas licences issued by Warsaw without open tenders, an expert explained that the issue had been dealt with in the new mining law.
Asked about Commission legal proceedings against Poland for allowing shale drilling at depths of up to 5,000 metres without first having assessed the potential environmental impacts, the expert said the process was still pending. It was being discussed by the ministry of environment in Warsaw and the Commission.
Polish Prime Minister Donald Tusk last April called for an EU Energy Union, saying that the EU should pay up to 75% of the cost of gas infrastructure. EurActiv asked the experts whether Poland was asking for funding from Brussels for its shale gas projects.
>> Read: Poland calls for EU energy union
The experts said the projects referred to by Tusk were part of the Connecting Europe Facility regulation and that none was related to shale gas.
Experts said there were many varying reports about what proportion of Poland’s gas needs could be met by shale. Poland is preparing a new report about the potential of the resource.
“What can be said for sure is that shale gas can play a role in Poland’s energy mix, which today is of 16 bcm a year [billion cubic metres of gas]. So every another 1-2-3 or more bcm is a game changer that can support us,” the expert said.
The energy mix would be further improved when the Polish liquefied natural gas (LNG) gas terminal in ?winouj?cie was completed, he added.
The ?winouj?cie terminal is scheduled to begin operations in the second half of 2014. In its first phase, the LNG terminal will have a capacity of 5 bcm/y.
Asked if the projects would be economically viable, experts said that all studies showed that the price of gas from the projected new sources would be competitive compared to pipeline gas and would strengthen the market.
By the end of the year Poland and the UK will present a joint report on the macroeconomic impact of shale gas in the EU.
Andrzej Kassenberg, President of the Institute for Eco-Development (IED), said that given the appropriate ecological precautions, shale gas could be a significant help in the transition from fossil fuels to renewable energy sources in the Polish energy mix. The natural gas used in the energy generation produces much less pollution than oil or coal, though of course it is still not clean energy, he insisted.
“Such precautions cannot be achieved, though, without a significant level of cooperation between all of stakeholders: the government, energy companies (both public and private), local communities and NGOs. There is room for a significant improvement in communications between them. This improvement could also help in creating a complex approach to shale gas, which could include, for example, setting aside part of the income from this source of energy for the development of the renewable energy sources,” Kassenberg said.
The Polish Exploration and Production Industry Organization [the association of virtually every company in Poland that is engaged in shale gas exploration or extraction, among other members], welcomed the amended Geological and Mining Law of Poland.
“The finally adopted [5th August 2014] Geological and Mining Law (GML) has, we are pleased to say, implemented a few of the industry’s key issues: a major one, as the rejection of NOKE (the state owned operator) to be participating on an obligatory basis in all new investments; […]
The Amendment of the GML unfortunately did not include necessary changes in the other Acts (beyond the responsibility of the Ministry of Environment), which are responsible for significant number of red-tape issues that greatly extend the permitting process (process takes up to one year in Poland, while the same procedure for example in Pennsylvania consumes approximately 45 days). […]
Prof. Stanis?aw Rychlicki, Vice-Dean of the Oil Engineering Faculty at AGH University of Science and Technology, stated:
“The new legislation [GML mentioned above] may not be enough to help Polish shale gas mining. We only have drilled in 56 places – while about 150-300 drills are needed to have enough data to estimate the size of shale gas deposits in Poland.
The costs of such drilling is a significant obstacle. One drilling would cost about $15 million, which would be a big expense for a Polish company. The foreign investors, including Americans, have both money and technology to do that, but they are not familiar with the Polish legal environment, so they often decide to go to more familiar regions”.
Shale gas is an 'unconventional' fossil fuel that is found within natural fissures and fractures underground. Until recently, no method of safely transporting it to the surface existed.
It is mined via hydraulic fracturing, or ‘fracking’, the process of breaking apart layers of shale by pumping liquids and a number of chemical additives under high pressure, releasing trapped gas reserves.
To its supporters, shale gas represents an untapped and welcome alternative energy source to traditional fossil fuels. At the moment the EUt depends on gas imported from Russia, and disputes between that country and Ukraine have disrupted winter supplies in recent years.
Business and Industry:
- The Polish Exploration and Production Industry Organisation: OPPPW’s Statement
- EurActiv Poland: Przysz?o?? ?upków pod znakiem zapytania
- EurActiv Poland: Co dalej z ?upkami w Polsce?
- EurActiv France: La Pologne milite auprès de l'UE pour exploiter le gaz de schiste