Aftermath of Ukraine Crisis: What Shale Europe Do? | Student Reporter

Having the largest estimated shale gas reserves, Poland has been considered Europe’s poster boy for shale gas. In early June, Warsaw received endorsement from U.S. President Barack Obama, who committed to helping Poland develop its shale gas industry. The Eastern European country has been learning from the U.S. since 2010, when it became the first country to participate in the U.S. Department of State’s Global Shale Gas Initiative. As a part of the initiative, Poland received funds for conferences and educational trips.

Polish Environment Minister Maciej Grabowski announced in June that over 60 exploratory shale gas wells have been drilled in Poland and that 40 more are expected to be drilled by the end of the year. The government seems to be decisive, and people are mostly supportive of shale gas development. Around 70 percent of the population living in shale gas exploration areas support gas extraction, according to a poll carried out by TNS Polska for the Ministry of the Environment. Energy security issues and economic impact are the main driving forces.

But even here there are problems. Four companies, Marathon Oil, Exxon Mobil, Talisman and Total, have pulled out, citing “lack of clarity in the law.” In March the Polish government finally drafted a belated law that would provide tax exemptions for six years for companies involved in shale gas exploration.

“It’s overall a bit of a mess,” said Michael LaBelle, an assistant professor at Central European University, which is based in Hungary. “The environmentalists there [in Poland] that I interviewed weren’t really concerned about shale gas development in the country because they thought the administration was inept … and nothing was going to happen very fast, and the scale of it would be really small.”

In addition to that, there is no exact information on the amount of shale gas available in Poland, apart from speculation that it might be the biggest resource in Europe. According to the EIA, the country has 148 trillion cubic feet of shale gas, which totals almost one-third of all European reserves. This would be enough for 300 years of consumption. However, in 2012 the Polish Geological Institute lowered the estimates by 90 percent.

Thomas Murphy, co-director of Penn State’s Marcellus Center for Outreach and Research, agrees that the progress of shale gas development in Poland is slow compared with the U.S.

“You can argue that here, in Pennsylvania, for instance, 7,500 wells have been drilled in the last five to six years. In Poland it took about three to four years for the first commercial well to come in line,” Murphy said.

Due to a lack of pipeline infrastructure, shale gas development in Poland can cost up to three times more than in the U.S., where drilling a 6,562-foot horizontal well costs around $4 million, according to estimates made a couple of years ago by leading oil services company Schlumberger. In Poland, drilling a similar well would cost around $11 million.

Another important concern is that American technology might not work in Europe because shale gas lies 1.5 times deeper than in the U.S., which means that more powerful rigs and pumps and more fracking fluids are needed. Also, water sourcing in Europe can be 10 times more expensive than in the U.S., and water shortages are likely to happen in certain regions of Central and Eastern Europe.

According to David Buchan, a senior research fellow at the Oxford Institute for Energy Studies, all the other EU countries lie between Poland and France on the shale gas spectrum. Poland’s doubtful prospects put it on the spectrum’s “successful side” and France’s ban on fracking place it on the other end, so it seems that no nation in Europe has yet found the golden key to a new gas industry.

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