Poland looks to reduce dependence on Russia with shale gas law
Prime minister said conflict with Ukraine adds to importance of new shale gas legislation in Poland
WARSAW, Poland—Poland’s government has adopted a draft law designed to speed up shale gas exploration and reduce dependence on Russian supplies, according to the country’s prime minister.
Poland, which imports about 70 per cent of its gas from Russia, is seeking to exploit its shale gas deposits, but complicated legislation has been an obstacle and discouraged some foreign energy firms.
Donald Tusk said that Ukraine’s conflict with gas supplier Russia adds to the importance of the legislation.
Put on fast track, it could take effect this year.
“The idea behind the draft law is to make possible intensive exploration and extraction of shale gas,” Tusk said.
Tusk said the draft law will simplify and accelerate license procedures for companies.
Taxes on exploration will begin in 2020 and should not be higher than 40 per cent.
A number of major international exploring firms have given up on shale gas in Poland in the past due to tough licensing terms and lack of sufficient data on deposits.
Because of the country’s geological make-up, exploring in Poland is also more technically demanding than in the United States, where shale gas industry boomed in the 1990s, bringing gas prices down.
Early estimates by the U.S. Energy Information Administration that put Poland’s shale gas reserves at 5.3 trillion cubic meters were revised down sharply by Poland’s geology experts to below 800 billion cubic meters.
Shale gas is natural gas trapped in porous shale rock.
It is extracted though hydraulic fracturing, or fracking, a technique that involves pumping huge amounts of water—laced with sand and small amounts of chemicals—into horizontal wells drilled in the rock.
That crushes the rock, releasing the gas.
Poland and Britain are the only countries in Europe actively exploring for shale gas.