Poland €414m shale gas cooperation deal hit by 3-month delay

12 November 2012 16:44  [Source: ICIS news]

LONDON (ICIS)--Five Polish companies have been unable to hammer out the details of a zlotych (Zl) 1.72bn ($526m, €414m) shale gas cooperation deal by the targeted November deadline, but now intend to reach an agreement by 4 February next year, the companies said on Monday.

State-owned gas incumbent PGNiG, along with energy utilities Polska Grupa Energetyczna, Tauron Polska Energia and Enea, as well as copper producer KGHM Polska Miedz, linked up in July to explore for shale gas in a 62 square mile (161 square km) area of northern Poland.

The companies are considering data including a report from the Polish Geological Institute that shows the break-even price for shale gas in Poland could be much higher than in the US, partly because Polish shale gas basins tend to be less accessible than American ones.

Despite setbacks, including the June withdrawal of US-based petrochemical giant ExxonMobil from Poland's shale gas exploration sector following early drilling that did not indicate strong gas flow rates, the Polish government still hopes it can replace a large proportion of imported Russian gas by exploiting domestic shale gas resources.

Poland imports 10.2bn cbm of gas a year from Russia, while the country's total consumption is 14bn cbm/year.

($1 = Zl3.27, €1 = Zl4.15)
($1 = €0.79)

By: Will Conroy
+44 20 8652 3214



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