Poland

Poland’s potential shale gas reserves are extensive, stretching along a belt from the northern coastal area between Słupsk and Gdańsk, eastwards through Warsaw and on towards South Eastern Lublin and Zamość.

Size of the opportunity

There is still much need for comprehensive exploratory drilling in Poland, as estimates can vary greatly as to the size of reserves.

In March 2012, the Polish Geological Institute issued estimates for Poland´s shale gas resources. In the conservative scenario resources are estimated at 346-768 billion cubic metres – enough to supply the country for 35-65 years. The higher estimates indicate that Poland’s total reserves could reach 1.9 trillion cubic metres.

A study in May 2012, conducted by Saponis Investments S.P., has shown a potential 376 billion cubic metres of shale gas under just three concessions in northern Poland, indicating that reserves may be more abundant than allowed for by the Polish Geological Institute.

According to initial estimates from the US Energy Information Administration, not yet confirmed by exploratory drilling, Poland’s shale gas reserves are among the largest in Europe, with a potential 4.1 trillion cubic metres (148 trillion cubic feet) of technically recoverable resources, although the scale of these reserves is still being determined.

Concessions

According to the Ministry of the Environment, as of April 2013, there are 109 concessions for shale gas, covering 88,000 km², with 43 exploration wells: of which nine carry out hydraulic fracturing and four have horizontal sections. A list of the existing concession as of 1 February 2014 are available here.

Impact on energy security

Poland has had long-term problems regarding its energy security. In 2010, gas imports accounted for 69.4% of Poland’s gas consumption. The problem of significant reliance on Russia for gas supply was highlighted by the Russo-Ukrainian gas dispute of 2009 and the completion of the Nord Stream project. This has been made all the more acute with the Ukraine crisis in early 2014 which led Poland to take affirmative action to encourage its shale gas sector.

This is all the more important as a study by KPMG highlighted the view that, for some parts of the public shale gas in Poland is seen as “the ultimate solution for the country’s energy security”.  The domestic production of shale gas will allow Poland to reduce its dependence on imported gas with even the most pessimistic estimate indicating sufficient reserves to make Poland self-sufficient for 65 years.

Impact on the economy

The potential offered by Poland’s shale gas reserves will allow the country to build upon its recent economic development, as well as to remodel its energy sector. According to the Polish Ministry of Environment, investments in Polish shale gas up to April 2012 totalled zł.2 billion (just under €500mn).

Production of shale gas will foster job growth, skills development, improve national infrastructure and lower domestic energy prices; with positive benefits for the entire Polish economy.

At a Brussels-based event in 2012, a spokesman for the Polish Ministry of Foreign Affairs said the economic benefit of developing shale gas could be as great for Poland as that of membership of the EU.

Poland will be able to “green” its economy by switching from dirtier forms of energy, such as coal, to a more environmentally friendly shale gas supply, whilst creating jobs and growth.

Government policy

The Polish government has embraced the potential benefits shale gas can bring to the country both in energy security and economic growth, stating it wants commercial shale gas production to begin in 2015, if not before.

General sentiment increasingly disputes the need for European-level regulation of shale gas production, preferring regulation to be set by the government of the country where the shale gas is produced.

In March 2014 the Polish Government gave its full backing to shale gas with Prime Minister Donald Tusk announcing that shale gas extraction would be exempt from tax until 2020 and the new Minister of the Environment Maciej Grabowski stating that shale gas was his priority in 2014.

The Polish Government and shale gas
Bogusław Sonik discusses the European Parliament’s shale gas report which he rapporteured