Oil's Fall Rocks Already Reeling Polish Shale Gas Hopes

Reuters

WARSAW, Feb 12 (Reuters) - Poland, once Europe's greatest hope for shale energy, is reeling from a rapid change in fortunes as U.S. companies walk away and low oil prices postpone any realistic start to commercial drilling.

Facing EU environmental targets in 2020 and beyond, Poland needs to find alternatives to burning coal. It also wants to reduce imports of Russian energy by producing more of its own.

Yet hopes that drilling for shale gas can replace these have dimmed, with Chevron the latest major energy company to quit Poland.

ExxonMobil, Marathon and France's Total have all been and gone.

A drastic cut in Poland's estimated shale gas reserves marked a first blow in 2012. A 50 percent drop in oil prices since last June has proved a second.

"For us the situation is dramatic. All projects have to be put on hold," said one manager at a small energy company in Poland, pointing to hundreds of layoffs as investors withdraw and servicing firms remain idle.

While exploratory drilling has been done, Poland has not delivered a single commercial well and the only global major company left is ConocoPhillips.


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