Polish Fracking Jul 15, 2012 3:34:58 GMT -7
Post by nictoe on Jul 15, 2012 3:34:58 GMT -7
A natural gas storage facility in Husow, Poland, in 2006, when a price dispute between Russia and Ukraine reduced gas supplies that traveled to Poland through Ukraine
Poland dreams of energy independence — through fracking
Eager to end reliance on Russian natural gas, and largely untroubled by environmentalists, Polish officials are embracing hydraulic fracturing to unlock potentially huge deposits beneath their soil.
By Henry Chu, Los Angeles Times
July 15, 2012
GDANSK, Poland — Dreams of freedom from Soviet oppression were nurtured and realized in the shipyards of this seaside city, where the Solidarity movement that helped tear down the Iron Curtain was born.
Now, Poles are having new fantasies of throwing off Russian domination. But this time the road to independence lies more than a mile beneath their feet.
If geologists are right, up to 768 billion cubic meters of natural gas sits trapped in shale deposits deep beneath the surface in Poland, enough to meet the country's needs for the next 50 years and more. The estimates have tantalized Poles with visions of ending their reliance on Russian gas, which warms them through harsh winters but puts them at the mercy of their former masters far more than they would like.
Exploiting these underground resources, though, will mean a lot of noisy, water-intensive and potentially harmful "fracking," or hydraulic fracturing, the process of shooting chemical solutions mixed with sand into the shale to prize it open and release the gas. It's a controversial practice: Concern about ill effects such as groundwater contamination has led to a ban on fracking in countries such as France and Bulgaria and in the state of Vermont.
But here in Poland, officials excited by the prospect of energy independence and largely untroubled by environmentalists are embracing it with a passion.
So are the foreign companies that have stampeded into Poland to stake claims in what one American participant happily describes as a "land grab."
"We only need one of these things to work, and it could be a company-maker," said John Buggenhagen of San Leon Energy, sitting amid rolls of geologic and scientific maps in his Warsaw office. The multinational firm owns the rights to explore 14 "concessions" in Poland, each covering nearly 400 square miles.
Even if all that gas is there — by no means a certainty — it will take years for this fast-growing Eastern European nation to develop production on a scale necessary for achieving self-sufficiency.
Poles consume 14.5 billion cubic meters of gas a year, about 30% of which comes from domestic sources. Nearly all the rest is imported from Gazprom, the state-owned Russian energy giant, which has been known to play hardball with its customers.
In early 2009, at the height of winter, Gazprom withheld gas from Ukraine in a dispute over prices and payment, a shutoff lasting for days that also affected delivery to more than a dozen other shivering European nations. On at least one day in February of this year, Poland detected a sudden 7% drop in supply from Gazprom; some suspect Russia was holding back some of its gas for itself to combat a nasty cold spell.
Such incidents have turned shale gas into something of a mantra for the Polish government.
"Every cubic meter of gas that … doesn't have to be imported is good news," said Michal Golebiowski of Poland's Treasury Ministry. (Overall, the country is still heavily reliant on coal for its energy needs.)
Polish officials have made frequent visits to the U.S. to learn from American successes — and failures — in places such as Pennsylvania and Texas, where hundreds of drilling rigs have proliferated in just the last few years.
But Poland faces particular difficulties. Support services and infrastructure are lacking. More daunting is the fact that the shale deposits, believed to stretch in a wide belt from northwest Poland down to the southeast, lie much farther underground than in the United States, as deep as 2 1/2 miles below in some cases.
That will make drilling much more expensive than in the U.S. Officials contend that Poles would still come out ahead, because they pay about five times more for natural gas than Americans do.
"Any activity that will make for a chance of cheaper energy will be supported by citizens," Golebiowski said.
Not quite all of them.
Marek Kryda, an environmental activist here in Gdansk, is worried that his country is running headlong toward an illusory goal without really counting the cost.
Fracking generates massive volumes of toxic water and huge piles of debris. In the U.S., federal regulators have linked the process to tainted water supplies in Wyoming. A panel of lawmakers in New Jersey approved a bill in June to bar fracking waste from entering the state from neighboring Pennsylvania.
Drilling for shale gas has also been blamed for triggering two tiny earthquakes in northwest England last year, a region not known for seismic unrest. Worried Britons are demanding a fracking moratorium.
In Poland, a recent study of a drilling site by the Polish Geological Institute deemed it environmentally safe. But Kryda is skeptical, saying that the institute is under heavy political pressure to support Warsaw's agenda of weaning the country from Gazprom.
"To say that Poland is dependent on Russian gas is a lie.... Poland is dependent on the price of Russian gas," Kryda said. "We can cut off Russian gas tonight and buy 40% or 50% more expensive gas from Qatar. But Poland is not doing this."
In the Pomerania region, which includes Gdansk, authorities have issued exploration permits for 22 concessions, spread out over an area famed for its beauty, with lakes, forests, verdant farmland, medieval castles and inviting white beaches hugging the Baltic Sea.
Malgorzata Maria Klawiter, a regional official who promotes the hunt for shale gas, said companies could maintain environmental safety, reduce noise and keep the drilling rigs from spoiling the rustic landscape.
"We can hide the facilities so that they look like little houses maintained in the local architectural style," she said. "Our current goal is to determine if shale gas occurs in commercial amounts, and if so, will the extraction bring a reasonable profit. It may turn out either way."
Critics believe the estimates are exaggerated. Energy giant Exxon Mobil announced in June that it was abandoning its exploration efforts in Poland after two of its wells yielded disappointing results.
Buggenhagen of San Leon Energy said some players barreled in with inflated hopes, especially after a U.S. government study suggested that Poland's shale gas reserves could amount to 5.3 trillion cubic meters. The Polish Geological Institute's recent estimate of 768 billion cubic meters is a fraction of that.
"There was an unrealistic expectation in the financial markets that we were going to drill a few wells and this was going to be the next Barnett Shale," said Buggenhagen, referring to a massive reserve discovered in Texas.
The initial hype has tapered. But many remain convinced of Poland's promise.
"I think there's outstanding potential," said Buggenhagen, who considers Poland his No. 1 priority. "It's the heartbeat of our company."