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Out of Gas
Poland Is Singing the Shale Blues

Europe has a gas problem. It relies on Russia for 30 percent of its natural gas supply, and many countries in the bloc get upwards of 50 percent and, in a handful of cases, all of their gas from Moscow. Even before the tug-of-war over Ukraine escalated into the conflict it is today, European policymakers were agitating for diversification away from Russian gas—Gazprom likes to lock its customers into long-term, take-or-pay contracts, and many of their customers have looked elsewhere for more favorable rates and terms. But the fight over and in Ukraine has raised new concerns over supply disruptions, and the simple fact that Europe has a very real need for something only Russia can provide at the moment has hamstrung the West’s response to Russian incursions in Crimea and eastern Ukraine.

It just so happens that Europe has troves of untapped gas trapped in underground shale formations, but strong green lobbying and a mistrust of the drilling techniques that have proved so effective across the Atlantic have stymied all attempts for commercial production of shale hydrocarbons. But in Poland, this shale fail has not happened for lack of trying. Poland has been eager to tap its shale, but has run into problem after problem. The countries reserves, once estimated to contain 146 trillion cubic feet of natural gas and 1.8 billion barrels of oil, are now thought to be much less promising. Poland’s geology has frustrated drillers, as well; while the U.S. enjoys a neatly-layered “wedding cake” geology, ideally suited for horizontal well drilling, Polish shale formations are more “crunched,” and difficult to frack. The country’s hazy regulatory environment has frustrated oil majors, and four of the five early movers in the country have called it quits. Now, as Reuters reports, Poland’s environment minister is revising expectations for exploratory well drilling this year down 20 percent:

Poland is seeing less exploratory drilling for shale gas than expected, environment minister Maciej Grabowski told Reuters, dealing a setback to the country’s efforts to find a cheap alternative to the natural gas it imports from Russia…Grabowski said he expected just over 80 exploratory wells would be drilled this year, down from the 100 he projected in a newspaper interview in June. […]

Despite this, Grabowski said that based on information the ministry was receiving from energy companies exploring for shale gas, commercial production would start this year.

This goes to show just how unique the American shale boom is. So many different factors need to come together, some natural and others not, for shale gas or tight oil to start flowing. Poland seems to have one of the few clear-headed energy policies in Europe, but so far it’s finding little reward.

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  • natehertel

    As I understand it, fracking isn’t more prevalent in Europe because landowners, unlike in the US, don’t own the mineral rights beneath their property.

    You would immediately see support for drilling in many of those countries if the benefits of drilling (huge income) were seen by the same local populations as the costs (increased traffic, infrastructure construction, etc)

    • Pete

      You’re exactly correct.

  • Breif2

    Poland: willing but unable. A sad pattern.

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