Poland

Updates

January 19, 2015: it seems incredible that less than a year ago folks were still talking about a fossil fuel renaissance in Europe, with countries like Poland potentially producing their own natural gas. With the glut of oil and natural gas, and prices collapsing, one wonders if there is even any thought of any fossil fuel development in Europe.  

Original Post

As a "Big Story," I track "Europe is at a tipping point" here.

One country that gets a lot of energy "play" is Poland. The oil and gas industry is excited about the prospect of natural gas in Poland but has been frustrated by both political obstacles and technological issues.

All of a sudden, in the last few weeks, Poland has gotten a lot more exciting.  Don sent me this Calgary Herald story:

The Russian invasion of Crimea is making Alberta's oil and gas more attractive in European capitals, says Poland's ambassador to Canada.

Poland supports the idea of importing Canadian oil and gas, envoy Marcin Bosacki said Wednesday prior to the start of a two-day visit to his country by Foreign Affairs Minister John Baird.

"This point of view is being shared in a growing number of European capitals in the last two months since the Crimea invasion," Bosacki said.

"Of course, we are absolutely in favour of increasing the abilities of ... western Canada oil and gas to be exported also to Europe."

Earlier this week, Polish Prime Minister Donald Tusk argued in an article in the Financial Times that the European Union should become less dependent on Russian energy sources.

Baird is touring several eastern European countries this week to express Canadian solidarity in the face of Russia's annexation of Crimea and its subsequent provocations in eastern Ukraine.

He wrapped a visit to Slovakia on Wednesday after visiting the Czech Republic a day earlier. After Poland, Baird is bound for Latvia and Estonia.

It's my perception that Polish politics has been as big a problem as the technology issues. Platts reported back in January, 2014:

The Polish government's decision to prioritize the acceleration of shale gas exploration has been welcomed by operators frustrated at more than two years of regulatory uncertainty.

That uncertainty combined with red tape and disappointing drilling results significantly slowed exploration in 2013. Just 12 wells were completed last year, compared with 24 in 2012.

In November 2013, Polish Prime Minister Donald Tusk fired his environment minister Marcin Korolec in a cabinet reshuffle saying he was frustrated at the pace of exploration.

Minutes after being sworn in, Korolec's replacement, Maciej Grabowski, said accelerating exploration would be his priority.

And this is the problem (sounds like Mexico):

Industry's main concerns about the proposals are the lack of a guarantee that exploration license holders, who are investing millions of dollars to verify reserves, will be able to convert that license into a production license.

The other is a plan to create a state-owned company, NOKE, which can take minority stakes in all future production licenses.

NOKE would have compulsory participation in profits without taking part in expenses and the right to veto investment decisions. The government signaled it would change this but the issue is still not clarified.

Sounds like the Poles want to nationalize foreign oil and gas industries even before they get started.

[There were so many possible subject lines for this one, I thought it best to simply call it "Poland" and not get myself in trouble.]