Polish Legal Regime: Good Conditions
“Poland has very good conditions for commencing in the upstream business,” remarked Daniel Borkowski, Attorney-at-Law at Legal Partner, a firm specializing in oil and gas advisory in Poland. “We have a good fiscal regime with reasonable royalties and taxes, lower than other countries.”
In an exclusive interview with Natural Gas Europe, Mr. Borkowski stated that the upstream business was a risky business. Of Poland, he said, “Some investment can be connected with risk, but the conditions for new entrants are quite good.”
He outlined three possibilities for concessions in Poland: exploration, prospecting and production. “In practice, companies which want to start operations in Poland receive the first concession for exploration and prospecting, and later for production.
“The connection between the two concessions is some kind of purity right to receive the production concession,” he explained. “If a concessionaire defines and recognizes deposits of hydrocarbons, they have a purity right to obtain a production concession without a tender and sign a usufruct mining agreement without a tender.”
Mr. Borkowski explained that this also entailed the ability to utilize geological information at no cost.
“We have some public geologic information,” he said, “in the newspaper and on the Internet. If someone wants to find some information, they can find it. There is information about the concession system and environmental regulation, a lot of which provides a very high standard for protecting the environment in Poland.”
Presently, Poland only had its Geologic and Mining Law in terms of oil and gas regulation.
“This regulation is for both conventional and unconventional resources,” he said.
As for this year, he described one big change on the Polish hydrocarbons scene.
“Our Geologic and Mining Law will have big amendments and this has been in progress since 1 January of this year, in concessions as well, so we’re still waiting for those to be implemented,” reported Mr. Borkowski.
Still, he admitted that Poland had not started actual production of unconventional gas.
“Many people contend that we can start production from 2014, but it could be later,” he said.
“We must give more information to society, to inform them about shale gas,” he said of making things happen in Poland. “Sometimes they receive incorrect information and it’s not clear for them. This presents a big social problem for unconventional resources,” concluded Mr. Borkowski.