Shale Gas in Poland: From Silent to Stealth Revolution

Driller tells why Poland is pre-eminent place for shale gas

Talisman Energy’s Country Manager in Poland, Tomasz Maj, told delegates at the European Unconventional Gas Summit Paris 2011 that he had two passions, UK soccer team Arsenal and shale gas. He was there to speak about the latter.

“It’s predictable in terms of its distribution,” said Maj. “We think it has longevity although we don’t know that, and it has high rates of return for some of us.”

He characterized the shale gas revolution in North America as a “silent revolution.”

“It’s astounding and very interesting and we’ll see if there’s a stealth revolution for shale gas in Europe.”

Mr. Maj reported that Talisman is looking at shale plays all over world. “No two shales are the same, and we don’t know where the sweet spots are. We use analogues, but there’s never enough data for a geologist.”

He told delegates in attendance in Paris not to be discouraged by results from early wells.

“We aim for the best rocks,” Maj said of Talisman. “We have a number of plays we’re evaluating and hope to enter relatively soon. We believe we have the best execution. Talisman came to Poland on the ‘second wave’ if you like. Our acreage is from San Leon Energy, an Irish company that’s been a great partner.”

According to Maj the best markets for shale gas development, where money was to be made, were those with beneficial economic and political environments. “Poland has companies of all sizes so you have to be ahead of the game,” he contended.

He harkened back to the North American shale gas experience: “Getting wells down as quickly and safely as possible, developing these wells and completing them as safely and quickly as possible is a manufacturing process,” Maj explained. “We are creating gas factories.”

“Bear in mind,” he continued, “the supply chain is a major issue in Europe. You need lots of suppliers that can compete with each other and supply services all year round.”

Related to that sentiment he noted cost reductions that were achieved in the Marcellus shale basin in North America over a period of one year.

“It’s a process one of continual optimization, learning and de risking. The idea is to drag costs down as brutally and quickly as you can,” said Maj. “Each play has unique characteristics & challenges.”

“Do not quit too soon,” he reiterated, mentioning that Poland had essentially no data on its shale basins.

Protecting the environment was key, according to him. “In any manufacturing process there is risk to the environment, and risk to health and safety, so these must be minimized as far as humanly possible.”

Another critical issue, he said, was engagement with local communities.

Maj stated, “The Marcellus is an area of high population density, and we’ve engaged with them from day one. It’s something you have to adapt to - the local environment.”

“Why Poland?” he queried. “We thought it was the best place. We’re not disparaging of companies that have looked elsewhere in Europe. We all have similar issues like Natura 2000. A shared learning process is invaluable. We believe Poland has the highest potential.”

Talisman’s acreage in Poland was in the north of the Silurian shale gas basin there, said Maj. “The database is extremely sparse, and hails from academic institutions. It’s an estimate but no one really knows what’s there.”

Still, he said it compared with the Montney and Marcellus basins.

“What are the benefits to Poland, why are we there and why should the Polish government enter into dialogue?” asked Maj. “It’s the diversification of energy resources which are not beneficial to the country on a long term basis. It has both political and economic dimension.”

He contended that the successful development of shale could mean major benefits to the environment. “Most Polish power is generated from coal and lignite. No one can tell me that gas is not a better option for Poland than coal,” insisted Maj.

“Revenues could be substantial and a significant number of jobs could be created.”

“We are at the pioneering stage in Poland,” continued Maj. “We’re facing limited public understanding of what we do but feedback has been extremely positive. The effect of negative attitudes toward shale gas from the outside is limited.”

He noted that Poland still only had sparse human and technical resources for full-scale drilling as most of the country’s geophysicists had “packed up and left.”

For now, Maj said Poland had a complex regulatory arrangement. “There needs to be a coordination of legislation. We need a single window approach to regulation which we don’t have in Poland or in Europe. This is part of the political process of making shale gas happen.”

In Canada, he said, one department dealt with the entire lifecycle of a shale site.

“We’re working very closely with the government for that to happen,” said Maj of Talisman’s operations in Poland. “The political will appears to be there. We’d like to make sure that the business can develop responsibly and safely.”

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