3Legs backs out of three Polish shale gas concessions | Reuters

WARSAW, Sept 18 (Reuters) – British energy company 3Legs Resources backed out of its three shale gas concessions in northern Poland, after test drilling did not yield satisfactory results, the company said in a statement.

The company, partnered in Poland with ConocoPhillips , had drilled a test well at Lublewo, west of the Polish Baltic Sea port of Gdansk.

“The well is producing higher amounts of oil than anticipated, whereas natural gas production is lower than had been hoped,” 3Legs said.

“The company has concluded that it would be in the best interests of its shareholders to exercise its option to withdraw from the three western Baltic Basin concessions,” it added.

3Legs now wants to transfer its stake in Lane Energy Poland, its joint venture with ConocoPhillips, to the U.S. firm.

The British company still holds three other concessions in the eastern part of the onshore Baltic Basin.

Poland launched a major push into shale gas three years ago when Prime Minister Donald Tusk announced it would seek to produce unconventional gas on a commercial scale in 2014 to help the country wean itself off Russian supplies.

But in 2012 a government report cut Poland’s estimated shale gas reserves by about 90 percent. Challenging geological conditions as well as legal uncertainty have additionally undercut investor interest in shale gas exploration.

Earlier this year, France’s Total did not renew its only Polish shale gas exploration licence, while Marathon Oil, Talisman Energy and Exxon Mobil pulled out. Chevron is still operating in Poland. (1 US dollar = 0.6139 British pound) (Reporting by Adrian Krajewski; Editing by Christian Lowe)

via 3Legs backs out of three Polish shale gas concessions | Reuters.