Leading geologist says its time to share data on Poland’s shale prospects

Polish Geologist Pawal Poprawa can imagine the successful development of shale gas in Poland and in Europe, but believes the scenarios are either black or white.

“There is a scenario that we will have no commercial production at all, but on the other hand you cannot exclude a scenario where Poland is exporting gas to nearby countries. This is also realistic.”

The geologist from the Polish Geological Institute admits that several questions, however, remain.

“Is there gas in this formation? We believe at the moment from initial wells, that there is. And is it possible to produce it very soon. And really the most important issue, is it possible to make it economic?”

The latter, according to Dr. Poprawa, will be the most difficult part of the equation.

“We know that Europe is more expensive for drilling services and won’t be as cheap as in the US and to make it economic will be a big challenge,” he explained. “For this reason, it’s a little difficult to predict the future: it might be that we have resources, but they are not economic in production.”

“If they are economic, I see a couple of places in Europe with a high potential for shale gas,” said Poprawa.

He and others spoke about European potential at the recent ShaleTech 2010 conference which took place in Vienna, Austria.

Poprawa offered his appraisal of Poland’s shale gas.

“From the data we have, there are some advantages and disadvantages. This is a big basin, simple in the tectonic structure, which is an advantage. It has thick shales and they seem to be suitable for such exploration.”

He was frank about the possible downsides of Polish shale for gas production.

“The major problem which we could name is the low total organic carbon (TOC) content, so it might end up that there will be some sweet spots with a higher TOC which will work and then there would be other areas that won’t work. But we need to take account that this is data collected from old wells – core data taken from the 1950s, 60s, 70s – these data are a kind of first approximation, and it might appear that the new wells with a properly treated core will show a little bit higher TOC,” explained Poprawa, who thought that the potential high risk factor may not present a problem.

“It’s a little bit difficult to say at the moment, because there’s a lack of data. Now the available data we have is from historical logs and they are not suitable for evaluating potential properly. For this we will need results from new wells. Some data are not possible to determine from the old data, like gas saturation.”

“So you need new wells and this year it has just started in Poland. Next year it should be very intensive and in a few years we’ll have ample data.”

Poprawa named two potential obstacles to tapping into shale gas potential: 1) environmental protection and adjusting shale gas exploration to European standards – doing it with negligible environmental impact; and 2) the struggle to make it economic.

“These are two big things to overcome and there will be a lot of effort concentrated on both of those.”

He said there were about 60 concession blocks granted by Poland’s Ministry of Environment to the roughly 50 enterprises exploring shale gas, on about 60,000 square kilometers of land.

As for the significant amount of players in Poland, Poprawa contends it bodes well for development of the shale gas business.

“In a way, it’s an advantage because there’s such a diversification of operators, that each one will have a little bit different approach to the technology. So I think it’s better that many players will try their way and once someone will succeed, everyone will repeat that approach. So in this instance, I see it as an advantage.”

“So far,” he said, “two wells have already been drilled by Lane Energy Poland together with Conoco-Phillips in the Baltic basin, but those wells haven’t been fracked yet, only drilled, so there is no result yet in the public domain.”

Poprawa said, “It is commonly known in Poland that there are encouraging results, and the company is moving on to the next steps, but there is no publicly available information yet.”

Now, it is time for the numerous players in Poland to contribute their data to complete the picture of the Silurian shale basin. Poprawa said that different companies employed different approaches when it came to sharing such data.

“Some companies are happy to share data and build consortiums among themselves, while others may have a different policy. Every company has to provide the Polish government with well reports and they have to give annual reports and report whatever they collect during the process on a concession – this data, however, is not public. The government cannot really make it public.”

He continued, “Since there is no competition, we hope that companies will be a bit more open at the moment to share information with scientific institutes, for example.”

And just how well prepared is Poland to be able to take advantage of an actual shale gas potential?

“Production is a challenge,” admits Poprawa. “It will be for every country in Europe. We are not really prepared for production yet but fortunately it’s a long perspective. It’s an issue which has been developing in the last few years in Poland and we could say that we are all surprised with the development of shale gas exploration.”

He continued, “At the moment there is a lot of work being done by governmental bodies and agencies to prepare Poland for possible production, so every ministry is involved in this process and discussions and they are in preparation, so it will take time before we see really significant production, and by that time proper regulations will have been made.

“Even at the moment when we don’t know what the potential of these shales is, we have projects for preparation of, for example, water management: where will we get water from and how can we utilize flowback water?”

Poprawa continued, “I suppose if there will be shale gas fields discovered and documented, and there will be production in the future, that takes time because of the large number of drilling operations necessary, so I suppose we might be ready at that time with proper regulations.

He said there were hopes that Poland’s government would pass a law on geology sometime next spring, but that they had been in deliberation over it for over two years.

Poprawa said he had not noticed much support to Poland from the EU for the development of shale gas potential – to the contrary.

“We are more afraid of counter action from the EU, because it’s not a big secret that some Russian politicians are trying to force the Union to make regulations more difficult for shale gas in Europe,” he said. “Russia having major natural gas players on the market, they would like to protect this position and obviously the development of shale gas resources in Europe would be a big problem for Russian exporters.”

Poprawa said he believed that because other countries in Europe also had potential, major political players in Europe would eventually throw their weight behind shale gas.

Source: Natural Gas For Europe