BNK Petroleum: Poland a Good Litmus Test for Europe

Given the level of unconventional gas exploration activity in Poland, Martin Robert, Vice President of Engineering and Operations at BNK Petroleum agreed that Poland was a very good litmus test for ascertaining whether unconventional gas could be developed in Europe.

“Poland is very active, with several companies with excellent experience and knowledge. Poland appears to have excellent potential with very good support from the Polish government,” he explained in his interview with Natural Gas Europe.

Mr. Robert added that there was a lot of incentive for Poland to become independent from their importing sources and that would help all companies prospecting the country’s shales, including BNK, to drill the wells, properly test the shale and determine whether it was feasible to produce.

“At that point it might provide information that is required for other countries, say Germany, France, Spain and the UK, where questions exist on the drilling and the hydraulic fracturing processes.

“When we are successful in Poland and we continue to implement our highest standards and our environmental protection philosophy, I believe it will provide verification for us or any other company – for the shale industry,” he contended.

Lately, though, there has been some impatience on the part of some media and analysts regarding how successful unconventional drilling has been in Poland in comparison with North America’s so-called shale gas revolution. According to Mr. Robert, it’s just too early to tell.

“Based on our information, the potential exists - we need more wells and more data. More knowledge will come from those wells to define how to get the gas out,” he explained. “We know the gas is present – it’s been proven on our land and for others as well – we must go through the steps: it’s a learning curve and we have to understand the characteristics of the shale in Poland. We expect to follow a similar learning process in both Spain and in Germany. It’s a methodical process that takes time.

“BNK was one of the frontrunners in Poland and despite our background and experience, we continue to learn as we explore Poland. Now as we’re entering other countries, like Germany and Spain, we are starting immediately with open dialogue, being proactive and involving everyone.”

He noted that it had not been in the DNA of many in the industry to communicate, “Or to communicate only at a strict minimum and definitely not communicate to the media, because they were always considered an adversary. I think we’ve learned from our past experiences; now we’re entirely open, and it sounds cliché, but totally transparent. We want to communicate and at a minimum explain the factual information and then it’s up to the individuals to make their own opinion.”

Mr. Robert said of unconventional E&P explorers: “We’re exploring into countries that have limited oil and gas industries, and definitely no shale industry, so there’s a steep learning curve – it’s a process and we just have to work through the bumps. In all the countries where we work, the governments are very willing to sit down with us and share our experiences. While BNK has been doing this for years, here in Europe, it is a whole new industry which needs to get up to speed. It may take some time and that’s just a natural process. The media, citizens and the communities will all also have to go through that learning process as well.”

But are policymakers in Europe becoming more open to the prospects of unconventional gas on the continent?

“It is difficult to comment on what the policymakers may be thinking,” he said, “but I think they’re more open at listening right now. There’s a learning curve in each government and we need the time and patience as we go through the transition together.”

Mr. Robert said that drilling would continue in Poland for BNK throughout the year as well as further testing to determine whether it could be done effectively. The company will continue its seismic operations in Poland and expects to begin seismic acquisition in Germany by the end of the year. BNK would also like to drill in Spain this year.

He commented, “There are no real milestones. Every country is at a different level in terms of the exploration process, so they are all moving at their own pace, doing different things: it’s 5-6 years at a minimum to really get a good understanding.”

In attendance at the Unconventional Gas Forum in Barcelona, Spain, he said that BNK had submitted several applications in Spain in the last two or so years and last year three of them were awarded to the BNK subsidiary Trofagas Hidrocarburos.

Within the broader scope of Europe, Mr. Robert described the opportunity in Spain where BNK is still at an initial stage.

“We don’t really know right now,” he explained. “We are optimistic on the potential but must continue along our learning curve prior to commenting further”

“There are some old wells that have been drilled, whether it’s in Spain, Poland or Germany, that provide some data. We have seismic information, luckily, here in Spain confirming the depths of our targets, but we need to drill a well to determine the presence of gas. The stimulation tests will provide information to determine the potential and whether it’s economic or not.”

He reported: “Since late 2011, we’ve been building our team in Madrid and our intent is to submit our environmental impact assessments in April-May 2012. Our hopes are to be able to drill by the end of this year, but I think the approval and the communication process might move the drilling of the first well to 2013.”