Polish Government “Understands” ExxonMobil Withdrawal
Poland accepts ExxonMobil's decision to withdraw from shale gas exploration in the country.
The comment was made Monday by Waldemar Pawlak, Poland's Vice Prime Minister and Minister of Economy, in reaction to this weekend's announcement by ExxonMobil that it had "completed its exploration operations in Poland."
A statement by the multinational energy giant read: "There have been no demonstrated sustained commercial hydrocarbon flow rates in our two wells in the Lublin and Podlasie basins."
“Ending shale gas exploration in Poland means pulling out of further operations,” Gazeta Wyborcza quoted Exxon spokesman Adam Kopysc as saying.
Pawlak underlined that other other majors, including Chevron Corp., are continuing their work in Poland.
The senior Polish official suggested the move was linked to the the start of “big business in Russia,” alluding that ExxonMobil's focus was on a cooperation agreement with Rosneft on developing tight oil reserves in Siberia. (MORE)
“Making splits and practicing shale gas in Poland would be odd, ” Pawlak said.
Exxon had drilled and undertaken hydraulic fracturing operations at its Krupe 1 well at the Chelm concession and Siennica 1 well at the Minsk Mazowiecki concession.
News of the disappointing results were not a surprise. In discussing fourth-quarter results with analysts in January, David Rosenthal, Exxon Vice President for Investor Relations, said that the two wells completed in the fourth quarter showed insufficient flow.
The news from Exxon follows last week's delay on the unveiling of Poland's much anticipated draft law on the regulation and taxation on hydrocarbons.
The Ministry of Environment did not provide clarification on the reason for the delay, but reports have suggested that it may be linked to the timing of the Exxon announcement, as well as internal disputes amongst various ministries.
In his comments today, the Polish deputy PM added that the draft legislation, which covers exploration and extraction of oil and gas from both conventional and unconventional sources, including taxation, licensing and environmental issues, should create stable conditions for shale gas development in Poland.
Exxon Mobil holds six licenses in Poland: the Chelm and Werbkowice exploration concessions in the Lublin basin in central Poland and four concessions (Legionowo, Wolomin, Minsk Mazowiecki, and Wodynie-Lukow,) in the Podlasie basin.
Exxon has not yet given any indication of it plans for the concessions, though the Vice Prime Minister said the licenses should be either given up or sold.