Shale Gas Investment Guide, Vol 9, Summer 2015

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SHALE GAS investmentSUMMER 2015

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CONTENTS

64Lorem Ipsum

INDICATORS

DA

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RA

CK

ER

AN

ALY

SIS

WHO’S WHO

EXP

LOR

AT

ION

SERVICES DIRECTORY

SER

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ES

3,396

1,364

1,484557

645

200700

839

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76

198

76

SPAIN

FRANCE

UK

IRELAND

NETHERLANDS

GERMANY

POLAND

AUSTRIA

HUNGARY

ROMANIA

BULGARIA

LITHUANIA

SWEDEN

797

DENMARK

37,600

13 // 20 //

76 // 86 //

SHALE GAS INVESTMENT GUIDE | S U M M E R 2 015

W W W.CLEANTECHPOL AND.COM | 7

30 // TRENDING

34 // UK SHALE UPDATE •Conservativeswinelection •UKpermitsfrackingrules •Shalelikelytogetgo-ahead36 TIGHT GAS fuelsimagination inPoland

38 SCOTLAND frackingmoratorium

50 PGNIG hurtbynewrules

54 // THE OPPOSITION •UK:frackingbestbanned •PL:gasasaninterimfuel •Both:shalestrictlyregulated

58 Europeanshale,apictorial

68 OPEC:friendorfoe?

70 China’sFulingfieldtakesoff

72 Argentina,afastmule

102 // POLAND SHALE COALITIONAggrekonewestmember

CO

NT

EN

TS

20 //

86 //

20

54

58


Sum up, Step back, Look aheadShale gas needs to find its place in Poland’s energy puzzle and five years of exploration are suggesting - slowly as it is - how it just might fit.

WHEN I FIRST googled the phrase “shale gas Poland” I stumbled upon a 2010 article from the Prague-based magazine Transitions, where I started as journalist in 1999. The article’s title was “The Sweet Song of Shale,” a bitter irony looking back on the first five years of shale gas in Poland. Well, at least as long as one only looks at headlines in the media.

After five years publishing of the Shale Gas Investment Guide , we’ve gone through the early phase of en-thusiasm, when hit-ting a sweet spot in Pomerania seemed a matter of months, to the current sober out-look. Five years on, 70 wells drilled and still no commercial gas flow in a coal-loving Poland.

But what those five years have brought to Poland should by no means be underestimated. The fact that the opposition loves, such as Chevron’s pulling out from the European shale exploration, has given shale gas development too much of a one-sided interpretation of a complete failure.

When you speak to those who know better, however, here’s what they say: things have been scaled back to their normal size. There will not be trillions of cubic meters of shale gas.

The scale is rather five billion cubic meters (bcm) a year and it’s “still worth going after,” according to Paweł Poprawa whom I intervied for this issue of the Shale Gas Investment Guide.

To put that figure in perspective, five bcm a year would give Poland a huge leverage in negotiating a new price with current chief sup-plier Gazprom, something that Lithuania did in early 2015, with the help of LNG imports.

That level of production is within reach. Not least because operators have been on a learn-ing curve, recognizing what it takes to max out the gas-bearing potential of Polish shale formations.

For example, it is going to take fracs de-signed in such a way that they overcome the marlstone barrier between two shale strata, an obstacle to drilling in northern Poland. Or it is going to take a revised mapping of gas, oil, and liquids windows, which seemed to have been mistaken in the early stage.

Stepping back to look ahead, it seems the Polish shale effort will continue - ShaleTech, for instance, will begin exploring in the Baltic basin on the acreage formerly held by Lane Energy.

Albeit, the role of shale will change: from an unnecessarily hyped panacea to all of Poland’s energy problems to a small yet important piece of a complex energy puzzle: think renewables on the rise and coal in a diminished role. A place for everything, and everything in its place.

Operators are on a learning curve,

recognizing what it takes to max out the

gas-bearing potential of Polish shales

B Y W O J C I E C H K O Ś ĆOPINION


EDITOR IN CHIEFWOJCIECH KOŚĆ

PUBLISHERPARKER SNYDER

ART DIRECTORŁUK ASZ MAZUREK

CONCEPT DESIGNPAIGE WEIR

PRINCIPAL ANALYSTPIOTR WDOWIŃSKI

COMMUNICATIONSGABOR CHODKOWSKI-GYURICS

WRITERSPAUL GARRET T IN MEMORIAM

R ADEK BUDZOWSKI, NILIMA CHOUDHURY (LONDON), GABOR CHODKOWSKI-GYURICS, RHODRI DAVIES (BUENOS AIRES),

DAVID GACS (BUENOS AIRES), TIM GOSLING (MOSCOW, PR AGUE), ANDREW HOBBS (PERTH), MIRONA HRITCU (BUCHAREST),

LINAS JEGELIVICIUS (VILNIUS), HUBERT KAROŃ, STANISŁAW KOCZOT, JAKUB KOCZOT, JULIUSZ KOWALCZYK, PIOTR LEWANDOWSKI,

IAN LEWIS (LONDON), SAR A LICHWA (LONDON), ZUZANNA MARCHANT (LONDON), NIKOL AY MARCHENKO (SOFIA), JERIN

MATHEW (BANGALORE), WU MING (BEIJING), CHARLES NEWBERY (BUESNOS AIRES), NICHOL AS NEWMAN (LONDON), GREG

PENFOLD (CAPE TOWN), SONJA VAN RENSSEN (BRUSSELS), CL AUDIA PEREZ RIVAS (TEX AS), GR AHAM STACK (KIEV),

EDY TA STOPYR A , DOMINIC SWIRE (BEIJING), ALICE TRUDELLE (QUEBEC), JAN W YPIJEWSKI, GORDON WASILEWSKI,

JUDE WEBBER (MEXICO CIT Y), DAWID WIERZBICKI

EXPERT CONTRIBUTORSOLGA ANDRIENKO-BENTZ, JACEK CIBORSKI, PIOTR DOBROWOLSKI, FLORENCE GENY, GRZEGORZ KUŚ,

DREW LEIFHEIT, EVA-MARIA MACIAZEK, PAWEŁ POPR AWA , ELENA REVUTSK AYA , WOJCIECH SŁOWIŃSKI, VIDAS VENCKUS,

NAGLIS VINCIUNAS

EDITORIAL CONTACTWOJCIECH KOŚĆ, WOJCIECH@CLEANTECHPOL AND.COM, (+48) 602 458 099

ADVERTISING CONTACTPARKER SNYDER, PARKER@CLEANTECHPOL AND.COM, (+48) 517 469 881

PUBLICATION PARTNERSAMCHAM, CH ROBINSON, DTZ, NUTECH, POL AND SHALE COALITION, PWC, SSW

GUEST COLUMNISTSFR ANK MAIO, K ATHRYN Z. KL ABER, K AMLESH PARMAR, ANDREW AUSTIN

KEY PHOTOGRAPHYLOU DENIM, KM R ATSCHK A , KONR AD SIEROŃ, SZYMON SZCZEŚNIAK, WEMAKEPICTURES.CO.UK

DTPMAZUREK GR AFIK A , W W W.MAZUREKGR AFIK A .PL

PRINTERDRUK ARNIA BELTR ANI, W W W.DRUK ARNIABELTR ANI.PL, KR AKÓW

DISTRIBUTIONTM MEDIA , AL. JANA PAWŁ A II 61/239, 00 -117, WARSAW

SUBSCRIPTIONTHE SHALE GAS INVESTMENT GUIDE IS PRINTED TWO TIMES A YEAR. THE MAGAZINE IS DIRECT MAILED TO ALL LICENSED

OPERATORS FOR UNCONVENTIONAL OIL AND GAS IN THE EU-28. TO SUBSCRIBE, WRITE TO [email protected]

PUBLISHERCLEANTECH POL AND LLC, UL. KRUCZA 51/31, 00 - 022 WARSAW, POL AND

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To become a partner for the magazine, please contact the publisher

COMMERCIAL PARTNERS

The American Chamber of Commerce (AmCham)

is a business organization that serves and promotes its member companies.

AmCham fosters positive relationships with the government

and promotes the free market spirit.

www.amcham.com.pl

Cleantech Poland is a consultancy for oil and gas

providing representation services. Cleantech Poland publishes the

Shale Gas Investment Guide and the magazine Cleantech.

www.cleantechpoland.com

Poland Shale Coalition is an industry organization open to anyone. The Poland Shale Coalition, founded in 2013, aims at education

and outreach. Founding members of the Poland Shale Coalition receive

outreach in their concessions.

www.shalecoalition.pl

DTZ is a property services company,

providing occupiers and investors with end-to-end property solutions, global and local market knowledge,

forecasting and trend analysis.

www.dtzglobal.com

PwCPwC provides oil and gas companies with services in assurance, advisory

and tax & legal. A global services company, PwC has been in Poland

for 20 years and counts many of the largest oil and gas

companies as clients.

www.pwc.pl

SSWSSW provides comprehensive tax and legal advisory services. SSW, whose main practice areas are energy and natural resources, advises investors on the business implications of the

government’s proposed changes to oil and gas laws.

www.ssw.pl

Nutech is a U.S. based global oilfield

consultancy providing reservoir optimization and evaluation

services including optimization of existing wells.

www.nutechenergy.com

CH ROBINSONC.H. Robinson is one of the world’s

largest third party logistics (3PL) providers offering multimodal

transportation services and logistics solutions.

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FULL PAGE ADDear Colleague,

I write to you from the 5th East Meets West student congress at the mining academy AGH in Kraków Poland where I had the pleasure to join Jeff Spath, the president of the Society of Petroleum Engineers, and VP of Schlumberger on a panel about the future of Europe’s energy markets.

For five years, Cleantech has connected capital and technology to Europe’s energy markets. We offer products and services in three areas: data, sales and marketing. On the sales side, we are proud to represent GT, a seismic services company, in the UK onshore market, and we have just begun selling GeoGraphix, an interpretation software, across the 28 member states of the European Union.

We’re proud to be representing these dynamic, international companies. Shale gas, tight gas, geothermal and coal bed methane are all mapped through seismic acquisition, interpretation and processing. Shale gas can be a replacement for its cousin coal. Power markets reduce their carbon footprint. Industry gets a cheaper feedstock.

That’s why we’re proponents of unconventionals.

As publisher, I’m proud to announce the Shale Gas Investment Guide is celebrating five years on the market. To see where we’ve come from turn to page 58.

See you at Terrapinn in November 2015!

Regards,Parker

Celebrating our 5th anniversary

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www.pwc.pl

PwC Your trusted oil & gas and chemical advisor

Business Advisory

Wojciech Słowiński – Partnerphone: +48 502 184 [email protected]

For years, we support our clients with knowledge and market experience by providingbusiness advisory, tax and legal advisory, audit and accounting consultancy. We are happy to talk with you about the needs of your business.

© 2013 PwC. All rights reserved. PwC refers to the companies associated in the PricewaterhouseCoopers International Limited (PwCIL), each member of which is a separate legal entity and does not act on behalf of PwCIL or other member firms.

Tax and Legal Advisory

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GUIDE

SHALE GAS investment

Affected by the low price of oil, unconventional oil and gas sector will not see many new shale gas exploration wells drilled in H1 of 2015. In Poland, explo-ration will continue by state-controlled Orlen Upstream and PGNiG. Drilling activ-ity is also expected in Sweden, where shallow shale strata will likely not have to involve hydraulic fracturing to produce gas. In the UK, Cuadrilla Resources, amidst high controversy and local protests, is awaiting a fracking go-ahead from local authorities, but the sector as a whole is waiting for the results of the licensing round later in 2015.

P I O T R W D O W I Ń S K I P R I N C I PA L A N A LYS T C L E A N T E C H

E X P E RT V I E W

The first half of 2015 has brought a significant slowdown to the exploration of unconventional oil and gas in EU-28. This has come largely on the back of oil's plunging price, which disencouraged operators to invest in risky ventures that unconventionals are.

Apart from the situation on the global commodity market, unconven-tional oil and gas is not in favor with several European governments. Early 2015 saw new moratoriums on hydraulic fracturing imposed in countries like the Netherlands, where the existing ban was extended until 2017. The Welsh govern-ment said in February that it would do what it can to disallow fracking in Wales.

Scotland banned the controversial technology altogether. The Scottish ban affected exploration plans of INEOS Upstream that had interest in two Scot-tish licenses and tied the future of its refinery facility in Grangemouth to gas from shales as raw fuel.

On a more positive note, the licensing area of the 14th UK onshore licensing round does not like it is going to be re-duced, as the more pro-shale gas Tories managed to win May election in the UK. The current iteration of the Infrastructure Bill is not restrictive, but the opposition pledged to change it if they won the May vote, which eventually did not take place.

Elsewhere, the exploration effort is either even slower or at a very early stage.

Drilling of the first shale gas well in Denmark has been delayed as at press time, because of alleged use of unauthor-ized chemicals. Hungary's licensing round is expected to close in April 2015, with the country hoping to attract inves-tors from the US and Asia for its onshore oil and gas resources. The results of Croatia's first onshore licensing round were also expected in April.

For more information about licensing per country, please see the Who's Who section on page 76

MOST ACTIVE EXPLORERS OVER 6 MONTHSUNCONVENTIONAL EU28 OIL AND GAS

BY COMPANY

Company Country Total concession (Q4-Q1)

New wells (Q4-Q1)

INEOS Upstream UK 9 (+7) -

Gripen Oil&Gas SE 23 (+1) -

Orlen Upstream PL 9 1

Palomar Natural Resources PL 4 1

AB Igrene SE 25 -

Ascent Resources SK 1 -

Wintershall DE 9 -

ConocoPhillips PL 3 -

Cuadrilla Resources PL, UK, NL 7 -

Egdon Resources UK 35 -

ExxonMobil DE, (PL)* 18 -

GDF Suez SA DE, UK 28 -

Hutton Energy UK, (PL) 4 -

Nordsøfonden DK 2 -

Shesa ES 5 -

Total DK, UK 5 -

BNK Petroleum Inc PL, ES, (DE) 4 (-1) -

San Leon Energy Plc PL, ES, (DE), (SK) 15 (-1) -

PGNiG PL 10(-2) -

IGas UK, DE 62 (-7) -

Chevron (RO), (PL), (LT) 0 (-8) -

* Country code in parentheses denotes operator left that country

INDICATORS

2009 2010 2011 2012 2013 201430

40

50

60

70

80

90

100

110

120

130

$/Bbl

2

4

6

8

10

12

14

16

18

20

$/MMBtu

0

BRENTNBP

2009 2010 2011 2012 2013

Active concessionsCumulative wells

0

100

200

300

Concessions

0

50

100

150

Wells drilled

2014

OIL AND GAS PRICE

SOURCE: CLEANTECH

2009 2010 2011 2012 2013 201430

40

50

60

70

80

90

100

110

120

130

$/Bbl

2

4

6

8

10

12

14

16

18

20

$/MMBtu

0

BRENTNBP

2009 2010 2011 2012 2013

Active concessionsCumulative wells

0

100

200

300

Concessions

0

50

100

150

Wells drilled

2014

EXPLORATION ACTIVITY, PL & UK

SOURCE: CLEANTECH

Crude oil's current low price is behind the significant slowdown in the EU-28 unconventional oil and gas sector, as most of the companies that work in the upstream segment have cut exploration expenditure. Reduced demand for energy in the EU also played a role in diverting investors' attention from risky unconventionals.

SOURCE: CLEANTECH

www.pwc.pl

PwC Your trusted oil & gas and chemical advisor

Business Advisory

Wojciech Słowiński – Partnerphone: +48 502 184 [email protected]

For years, we support our clients with knowledge and market experience by providingbusiness advisory, tax and legal advisory, audit and accounting consultancy. We are happy to talk with you about the needs of your business.

© 2013 PwC. All rights reserved. PwC refers to the companies associated in the PricewaterhouseCoopers International Limited (PwCIL), each member of which is a separate legal entity and does not act on behalf of PwCIL or other member firms.

Tax and Legal Advisory

Tomasz Barańczyk – Partnerphone: +48 502 184 [email protected]

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14 | SHALE GAS INVESTMENT GUIDE | S E A S O N 2 0X X14 | SHALE GAS INVESTMENT GUIDE | S U M M E R 2 015

SCHLUMBERGER

The OFS industry leader said it would cut 20,000 jobs, from a total of 130,000, because of the significant slowdown in drilling activity seen since the oil price dropped to around USD 50/bbl.

WEATHERFORD

Weatherford plans to cut costs by letting go about 9% of its workforce, which accounts for 5000 jobs, out of current 56,000 worldwide. Weatherford expects a reduction of capex by USD 550 mln to USD 900 mln in 2015.

BAKER HUGHES, HALLIBURTON

Halliburton said that due to low oil price, it would cut about 1,000 jobs from over 80,000. Baker Hughes which was recently acquired by Halliburton said it would lay off about 10,500 employees, from a total of over 60,000.

At the current level of crude oil prices, E&P companies will not go ahead with investments as willingly as they used to in recent years. This will especially affect investments in exploration of P3 reserves such as shale gas, tight gas and CBM in Europe. Lower cash flow of E&P companies will also affect oilfield service companies such as Schlumberger, Halliburton and Weatherford whose revenues depend on drilling activity. These service companies have already said that they will cut jobs.

GUIDE


INDICATORSDEPRESSED CRUDE OIL PRICE HAS OIL AND GAS FIRMS SCALE BACK INVESTMENT, HURTS SERVICES

GLOBAL EXPLORATION AND PRODUCTION, 2015

CHEVRON

$-4.9 bln

Chevron's capex for 2015 was cut 13% y/y to USD 35 bln. The investment cuts will affect Chevron’s up-stream oil and gas E&P, particularly out-side the US. There, investment is planned to decrease from USD 28.3 bln in 2014 to USD 23.4 bln in 2015.

CONOCOPHILLIPS

Capital spending for drilling programs will drop by USD 1.5 bln to USD 5 bln in 2015. The company's long term investment budget will drop by 33% y/y, to USD 11.5 bln. This is a down-ward revision of a ca-pex cut originally an-nounced in January.

$-1.5 bln

SHELL

$-3 bln

Shell was the first oil and gas major to announce that it would defer or cancel projects worldwide. Exploration will be limited, and the capital spending will drop by USD 3 billion for in-vestments in conven-tional exploration outside of the US.

EXXONMOBIL

$-4.5 bln

ExxonMobil's ca-pex will go down 12% y/y to USD 34 bln, from the last year's figure of USD 38.5 bln. “We are capturing sav-ings in raw materials, service, and construc-tion costs,” the chair-man and CEO Rex W. Tillerson told investors in March.

TOTAL

$-2.6 bln

The French major announced a cut in capital spending of 10% in 2015, as well as a program of asset disposal, all part of a cost-cutting plan of new CEO Patrick Pouy-anne. In money terms, the cut will amount to USD 2-3 bln from last year's USD 26 bln.

-17 % -$116bln

SOURCE: CLEANTECH


GUIDE


INDICATORS

Ongoing exploration

BCMMedium estimates

Poland is only slightly more dependent on gas imports than the UK, but the problem is that it is dependent on a historic enemy Russia, which has been viewed as unreliable political and business partner of late, following the crisis it instigated in Ukraine. In 2013, the country gas production covered approximately 30% of domestic demand. No less than a revolution in the supply structure might be on the cards, however. Poland wants to diversify supplies using an LNG terminal (7.5 bcm capacity), coming online in 2015, that will take gas under a signed contract with Qatar. Poland also hopes to develop its estimated 350-780 tcm of shale gas.

3,396

1,364

1,484557

645

200700

839

650

76

198

76

SPAIN

FRANCE

UK

IRELAND

NETHERLANDS

GERMANY

POLAND

AUSTRIA

HUNGARY

ROMANIA

BULGARIA

LITHUANIA

SWEDEN

797

DENMARK

37,600

As the EU shale gas potential is not fully understood yet, the map mostly shows medium estimates. The estimate for Poland is the only one to take into account the results of exploration wells.

THE POTENTIAL IS OUT THERE: EU SHALE GAS RESOURCE ESTIMATES

SOURCES: PGI (2012), EIA (2013), BRITISH GEOLOGICAL SURVEY (2013/2014)

2015 KEY PARAMETERSP RO S P E C T I V E E U RO P E A N S H A L E B A S I N S

Country Basin State of play

Target Formation Thickness Target

DepthOperators involved

Prospective Resource Estimate

(BCM)

DK, SE Alumn Exploration

ongoing Cambrian 30-100 100-3500

Total E&P Denmark, Nordsofonden,

Gripen O&G, Igrene AB

995

DE North Sea German Basin On hold Lower Carboniferous,

Jurassic 20-500 1000-5000 ExxonMobil, Wintershall 1484

PL Baltic Exploration ongoing Siluarian, Ordovician 30-300 2000-4000 ConocoPhillips, BNK,

San Leon Energy 250

ES Cantabrian Basin

Awaiting EIA approvals Jurassic 50-600 2440-4420 BNK, SHESA,

San Leon Energy 1364

UK Bowland Exploration ongoing Jurassic, Carboniferous 150-890 1950-2750 Cuadrilla Resources,

IGas, Third Energy 37600

SOURCE: CLEANTECH

Estimates of prospective shale gas resource vary. Although some of them are very high, more exploration wells are needed to verify the potential. Poland, for example, is a case in point, with the initial estimates, coming in at 5,000 bcm, reduced sig-nificantly since exploratory drilling has begun.

Ongoing exploration

BCMMedium estimates


GUIDE


INDICATORS

If you compare annual gas demand forecasts from 2008 to 2013, every year the trend shows an increase, but from an ever lower base. Why is that?First of all, the volume of demand has fallen because of the economic crisis, which contributed to a fall in overall energy con-sumption in the EU. Secondly, the Euro-pean Commission's energy policy for the years to come will involve trying to keep gas demand flat, or even reducing it. This is making gas companies nervous about investing in gas infrastructure in Europe, because Europe doesn’t appear that much of an attractive market.

What’s worse, gas is losing market share because of policy failures. Large subsidies for renewables, combined with a weak carbon market, has led to a resurgence in coal in countries like Germany. Current power generation in some key EU member states is based on a paradoxical partnership of coal and renewables, which among other things is not good for the climate as coal emits around twice the CO2 gas does. From 2011 to 2014, gas lost 30% of its

power market share to coal, which is bad news for our industry as well as for the EU’s climate objectives.

That said, we are pleased with the refer-ences made in the Energy Union paper to both conventional and unconventional gas. It could be an early indication that the Commission is willing, after all, to recog-nize the fundamental role of gas for the EU energy security and the role it has to play in the EU's future energy mix.

Could gas markets in Europe be more competitive?The Commission should take note that it’s not joint purchasing of gas - as pro-posed for consideration under the Energy Union project - that will increase gas sup-ply security, but rather development of domestic resources in coordination with market reform. Take a look at North Sea gas markets - the UK, the Netherlands, Norway - they’re competitive markets because of the number of companies look-ing for gas, producing gas and trading gas, therefore creating a stable and competitive market. Domestic gas resources are pos-sible to develop in European regions that don't really have competitive, liquid mar-kets, for example in South Eastern Europe.

The Commission should also encourage so-called gas release programs, in which local gas monopolies release part of their gas to the open market. This was done in 1990s in the UK and recently in Spain to a good effect.

With investment in doubt and Russia an unwelcome supplier at the moment, what might the role of LNG be?LNG adds flexibility to supply and pro-vides extra options for EU gas importers, but the bottleneck is that in order for LNG to serve the wider market, we need inter-connectors. For example Spain with its seven LNG facilities is Europe’s biggest LNG market in terms of capacity, but it can’t ship gas freely to France and the rest

of Europe because of lack of interconnec-tors. More investment is needed in this infrastructure.

Do you think that it should be Eu-rope’s strategy to eliminate Russia as source of supply?Russia will remain an important supplier given the scale of the gas resource there and the existing pipelines that supply Europe. The Commission has said it does not want to eliminate Russia, but rather source Russian gas from a number of suppliers in Russia, not only one. This is the so-called counterparty diversification. Diversified sources of gas, for example from the Caspian region and North Af-rica, are also needed. But as I said, a key way of ensuring broad security of gas supply is through competitive domestic markets built upon the development of domestic production, trading hubs, LNG with interconnectors, and also market reform to address monopolies where they exist in Europe.

Is the industry talking about shale gas any more?The current oil price is affecting drilling decisions in various parts of Europe right now, but the fact remains we need to explore for shale gas, at least to under-stand the potential that may exist. Some companies have decided to prioritize investment in other parts of the world, but others remain in place, for example Total in Denmark or ConocoPhillips in Poland.

In the current commercial environ-ment, there is perhaps an opportunity for smaller independent companies. These companies can take advantage of prices falling in their supply chain, which could improve the business case of shale gas for them. I would also point to petrochemi-cal companies and utilities as a force that could get the shale gas industry off the ground in Europe.

E X P E R T I N T E R V I E W

The gas market in Europe faces multiple challenges: the low oil price has hit E&P budgets, a faltering carbon market favors coal, and unseen before amounts of LNG in search of markets. Is there hope for domestic gas E&P? We asked Christian Schwarck, deputy director of EU affairs at the International Associa-tion of Oil and Gas Producers.

C H R I S T I A N S C H W A R C K

Deputy director, EU affairs, International Association of Oil and Gas Producers

“We need to explore for shale gas, at least to understand the potential that may exist”

Christian Schwarck, IOGP


GUIDE


INDICATORS

7676

SPAIN

FRANCE

UK

IRELAND

NETHERLANDS

GERMANY

AUSTRIA

TURKEY

UKRAINE

SWEDEN

DENMARK

RUSSIA

UA

RURO

BG TR

B L A C K S E A

BULGARIA

ROMANIA GEORGIA

CRIMEA

GE

TANAPBlue StreamWhite Stream

Exclusive Economic Zone

RU before 03.2014

RU after 03.2014

BLACK SEA: EUROPE'S OIL AND GAS HOTSPOT... OR WAR THEATER?

A G A T A Ł O S K O T - S T R A C H O T A B L A C K S E A R E G I O N E X P E R TC E N T E R O F E A S T E R N S T U D I E S

E X P E RT V I E W

The Black Sea's balance of power has changed to the advantage of Russia, at the expense of Ukraine and Turkey. Rus-sia, after it cancelled its EU-oriented South Stream pipeline, is however eye-ing Turkey as a market for Gazprom's expansion. Moscow is now talking a new Black Sea pipeline, linking Russia to Turkey and capable of sending 63 bcm of gas annually. This, in theory, could be an easier venture than South Stream because the EU's Third Energy Package (separating tranmission from sales) does not bind Ankara.

SOURCE: CLEANTECH

On the European energy resources game board, the Black Sea region has been considered a transit area in the first place. But the sea itself could hold considerable resources of offshore oil and gas, which is one of the reasons why Russia attacked Ukraine in March 2014, annexing the Crimean peninsula to change the puzzle of coastal states' economic areas, mainly to disadvantage of Ukraine, but also Turkey.

2015 BY COUNTRYR E G I O N A L S C O R E B OA R D

Country Discovery (potential) Resource est. (unconfirmed) Companies

Romania

Domino-1, 2012 42-84 bcm OMV Petrom, Exxon Mobil

Pelican South-1, 2012 20-25 bcm OMV Petrom, Exxon Mobil

(Est Cobalcescu) (11.3 bcm) Petroceltic

(Muridava) (4.7 bcm) Petroceltic

Bulgaria 1-21 Han-Asparuh n/a OMV with Total and Repsol

Kavarna East, 2010 (268 mcm) Petroceltic

Turkey

Western Black Sea, 2012 n/a TPAO

(Sinop block) n/a Petrobras, TPAO, Exxon Mobil

(Block no. 3920) n/a TPAO, Shell

Russia n/a n/a Exxon Mobil, Rosneft

Ukraine (Skifska Prospect) n/aExxon Mobil, Shell, OMV

Petrom

SOURCE: CLEANTECH

2015 BLACK SEA PIPELINESW H E R E V E R G A S M AY F LO W

Name Capacity, bcm/year

Year operational Cost, €bln On map

TANAP 16 2019 7-7.5

Blue Stream 16 2010 3

White Stream 32 2019 4.5


GUIDE


INDICATORSLITHUANIAN LNG TERMINAL GAME CHANGER IN THE BALTIC REGION

V I D A S V E N C K U S PA R T N E R , P W C N A G L I S V I N C I U N A S CO N S U LTA N T, P W C

E X P E RT V I E W

Before building the terminal, Lithuania was fully dependent on Gazprom’s gas sup-plies. The country used to pay for gas the highest price of all three Baltic states. The Lithuania's president Dalia Grybauskaite, said at the time that the terminal was a strategic project that would decide the fu-ture of the region, with a potential to make Lithuania the energy security guarantor of the three former Soviet republics.

The floating LNG terminal, named In-dependence, started operations at the end of 2014, on location in Lithuania's major port city Klaipeda. The floating terminal was leased from a Norwegian company Höegh LNG for 10 years.

About one billion cubic metres (bcm) of gas are expected to be regasified during the terminal's first year of operation, while in the future, its annual capacity could reach four bcm.

This is more than enough to cover Lithuania's demand for gas, so the termi-nal's designed capacity will also enable to cover substantial percentage of demand in neighboring Latvia and Estonia. The ter-minal's operator LitGas is already supplying gas to Estonia via the Latvian grid.

The terminal is currently operating under an LNG supply contract with Nor-wegian oil and gas company Statoil that will supply 540 million cubic meters of natural gas (about 950 thousand cubic meters of LNG) annually. Each year Statoil is scheduled to deliver 6-7 LNG cargos to the terminal.

The contract with Statoil also provides possibilities for the LNG to be pumped to smaller tonnage vessels at the Klaipėda port and shipped to smaller terminals.

Successful development of commercial LNG reloading operations would increase the turnover at the terminal and at the same time lower its maintenance costs which are being covered by Lithuanian consumers.

2015 COUNTRYMAJOR DOMESTIC GAS PLAYERS IN BALTIC STATES

Country Company Role

Lithuania Lietuvos dujos Distribution, Retail

Lithuania Fortum Heat Lietuva Distribution

Lithuania Druskininku dujos Distribution

Lithuania Josvainiai Distribution

Lithuania Grata group UAB Retail

Lithuania Dujotekana Retail

Lithuania UAB Retail

Latvia JSC Latvijas Gāze* Storage, transmission, retail

Estonia AS Eesti Gaas Retail

Estonia EG Võrguteenus Transmission, distribution

Estonia Adven Eesti AS Distribution

Estonia Gaasienergia AS Distribution

Estonia Tehnovõrkude Ehitus OÜ Distribution

Estonia Sillamäe SEJ AS Distribution

* monopolist until no later than 2017 Source: Konkurentsiament 2014, IEA 2013

2013-2015 COUNTRYANNUAL GAS CONSUMPTION IN THE BALTIC REGION

Country BCM Supplied by Russia Year Price of gas in

€/MWh

Lithuania 2.7 100% 2013 34.8

Latvia 1.3 100% 2014 29.7Estonia 0.7 83%* 2015 31.7Finland 5 100% 2013 28

Poland 16 60% 2013 19.1

Germany 87.2 35% 2013 H1 18.3

* February 2015 Source: Lithuania Ministry of Energy, EU Commision, Elering, 2015

SPAIN

FRANCE

UK

IRELAND

GERMANY

POLAND

AUSTRIA

HUNGARY

ROMANIA

BULGARIA

LITHUANIA

SWEDEN

DENMARK LNG Klaipeda

FINLAND

LNG Tornio (2018)

LNG Gothenburg (2015)

LNG Baltic (Export only)

LNG Finngulf

RUSSIA

BELARUS

LATVIA

ESTONIA

NORWAY

LNG Świnoujście (2015)

320,000 m3

9,600 m3 (2015)

170,000 m3

1,300,000 m3

50,000 m3

300,000 m3

operational

planned

under construction

terminal capacity

20,000 m3 (2017)

Even a single facility could turn a market around. Estonia started buying gas from Lithuania’s LNG terminal in December 2014 to bring down imports from Russia from 100% to 83% in February, according to the terminal operator LitGas. Gazprom's role on the Lithuanian market has also been reduced, although no exact data is yet available.

Latvia’s monopolist gas grid operator and distributor Latvijas Gaze (LG) is key com-pany for the development of Baltic gas market. Any gas flowing across the region must flow through LG’s grid. LG also owns the region’s only gas storage facility needed to offset changes in demand. The Latvian government plans to unbundle LG by 2017.

LNG in-flowsNorway LithuaniaQatar Poland (end of 2015)Qatar Lithuania (2016)

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FANS WHO GATHERED in the morning of February 10th in Bad Kleinkirchen, Austria, for a women’s

World Cup downhill race were disap-pointed. The race was canceled. Unusu-ally springlike temperatures melted snow.

Warm winter in 2014 did not affect skiers only. A spell of warm weather that swept central Europe in late 2014 and early 2015 saw temperatures rising to even 18 degrees in some locations. The weather was the warmest in Dutch and German recorded history, and the warm-est in 50 years in the Czech Republic.

This reduced heating and power needs in Europe and quashed demand for gas as storage tanks filled to the brim.

The EU’s top three consumers all saw their demand tumble in 2014. The de-mand in the biggest single consumer Germany was 76.2 billion cubic meters (bcm), down 12.6 percent year-on-year (y/y). The second biggest consumer was the UK at 71.5 bcm, down 9.1 percent y/y, with Italy coming third at 60.7 ccm, a drop of 11.6 percent y/y.

Across the EU, the overall demand for gas fell 11.2 percent year-on-year in 2014 to 409 bcm, according to the industry association Eurogas, which cited warm winter as one of contributing factors.

Prices took a tumble too. In November

2014, UK month-ahead gas prices were at their lowest for the time of year since 2010, an effect of gas storage build-up to record levels while demand suffered.

NOT JUST THE WEATHERA couple weeks before skiers in Bad Kleinkirchen had to reschedule their

events calendar, another event took place, also in Austria. In the capital Vi-enna, gas executives gathered for the 8th Annual European Gas Conference. There, they witnessed a presentation from Laurent Vivier, French oil and gas major Total’s vice president responsible for strategy and market analysis in the

The European gas market is looking at some pretty difficult time ahead, as external factors that reduce demand, exploration and production will only ease in the long run.

B Y W O J C I E C H K O Ś Ć A N D P I O T R W D O W I Ń S K I

When the Going Gets Tough

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GAS DEMAND IN EU

The combination of low price of CO2 emissions, rise of renewable energy, and climate change-in-duced mild winters is causing gas demand to falter.

SOURCE: EUROGAS

ANNUAL, BCM


gas and power division.Gas professionals saw Mr. Vivier show

a slide with projections for gas demand in the power sector between 2020 and 2030. The 2014 forecast saw the demand line go up from about 130 bcm to 160 bcm. This, however, stood in stark con-trast to historical demand forecasts, which Mr. Vivier also showed.

For example, the 2008 forecast saw demand expectations to start at over 220 bcm for 2020 and go up to 260 bcm in 2030. Mr. Vivier showed demand fore-casts for gas in the power sector only. It was clear that it was not just heating sec-tor taking a hit because of mild weather, but falling demand for natural gas in Europe ran across sectors.

SLUGGISH GROWTHThe ongoing legacy of the economic crisis is one of the factors to impair the role of gas in the EU’s power mix.

It is only now that the EU is beginning to shake off the slowdown, but 2014 saw the 28-nation bloc still struggling. The growth in Europe as a whole was 1.5 percent in 2014, expected to pick to 1.9 percent in 2015 and 2.1 percent in 2016, according to the World Economic Out-look from the International Monetary Fund (IMF), published in April.

While not impressive, these growth

figures are part of the economic cycle. The growth is expected to pick up rather slowly until 2016, but there are chances for it to accelerate beyond cur-rent forecasts. A factor to watch is is the European Central Bank (ECB) that keeps rolling out its quantitative easing (QE) program of bond purchases, aimed

to tackle deflation and lower borrowing costs, and in effect boost growth.

With weather not a controllable factor and economic growth showing signs of recovery, these two factors can be viewed as a framework within which a number of other factors are at play, not necessar-ily to gas’ favor. Unfortunately for the gas industry, especially the gas-fired

Warm winter effectively reduced heating and power

needs across Europe quashing demand for gas as storage tanks

filled to the brim

EU

EX

PL

OR

ER

power sector, these factors do not look like they will be gone soon.

CHEAP COALExports of coal from Russia, Colombia and South Africa, the three main ship-pers to Europe, increased by 8.7 percent year-on-year in 2014, according to data compiled by Bloomberg. Russian coal in particular has become competitive in Europe, to the disadvantage of gas. Rus-sia’s exports have been rising with the help of falling domestic consumption along with the weakening rouble.

“A near 50 percent decline in the Rus-sian rouble against the dollar since June, following Western sanctions against

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EU COAL PRICES

Falling coal prices and cheap emissions allow-ances are driving coal use in the EU, contrary to the bloc’s climate ambitions.

SOURCE: BP, IHS MCCLOSKEY NORTHWEST EUROPE

ANNUAL, USD/TON

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Moscow over its involvement in the Ukraine crisis and a fall in oil and gas prices, has made [Russian] coal ex-tremely competitive in Europe,” Bloom-berg reported in January.

European coal prices have struggled more than other energy benchmarks in 2015 thus far. European year-ahead coal price fell to just over EUR52 per metric ton, the lowest in seven years.

CHEAP EMISSIONSRising imports of cheap coal to the EU seem to be at odds with the EU’s ambi-tion to be the leader in pro-climate policy, one of the fundamental goals of which is to reduce coal’s role in the bloc’s energy mix. This would have probably happened, if not for the struggling cli-mate policies.

Carbon emissions are cheap – too cheap, in fact, for coal-powered energy sector to bother about them, which in turn puts more expensive gas under pressure.

The price of an EUA, the European emission allowance, for December 2015 fell in early April to a record low level of EUR6.89 a ton on ICE Futures Europe exchange in London, a tumble of 70 percent since the start of the carbon market in 2008. The fall owes to a huge oversupply of permits that keeps prices low, encouraging industry to keep burn-

ing coal.The EU is considering a draft law

aimed at helping prices rebound by in-troducing a mechanism to automati-cally cut oversupply via the so-called Market Stability Reserve mechanism. It is set to kick in 2019, despite member states like Poland fighting for delaying it until 2021 because more expensive emis-sions permits are seen as threat to Poland and other Central Eastern European economies’ energy-intensive industries.

JUMP OVER THE BRIDGEEU’s carbon trading policies might be failing at the moment, but the bloc’s pol-icy to develop renewable energy is work-ing. With cheap coal undercutting gas from one side, policy-driven development of wind, solar and other types of renew-ables is putting a cap on gas’ growth op-portunities from the other. This suggests that the EU may just not use gas as the bridge between coal and low-carbon, renewables-driven economy, but simply jump to low-carbon future over it.

According to Capgemini’s 16th Euro-pean Energy Markets Observatory, published in October 2014, the share of renewable energy in the EU came in at 14.1% in 2012 and is well on the path for the 20% EU target in 2020.

Some policy initiatives are taking place

across the EU and in the European Com-mission as well to reduce support for re-newable energy, but renewables are now becoming competitive regardless of sup-port systems, and it is hard to believe that their development will stall.

Investment in renewables in Europe expanded to EUR51.2 billion in 2014. The figure includes, for example, the EUR3.4 billion finance deal - biggest ever apart from large hydro – of the 600MW Gem-ini project in Dutch waters.

EXPLORATION, PRODUCTIONNow that the scene is set – pressure on prices, demand and production from all directions – questions arise on the state

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The low price of CO2 emissions is one factor whose negative influence on the gas market will fade, as soon as the carbon market reform kicks in around 2019.

SOURCE: ICE

ICE FUTURES, EUR/TON

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of investment in gas E&P and infrastruc-ture.

According to oilfield services company Schlumberger, investment in oil and gas exploration and production (E&P) is expected to fall around 15 percent glob-ally in 2015. That’s equivalent to a drop of approximately EUR115 billion from the 2014 figure of EUR644 billion.

Even though the largest drop in E&P investment is not occurring in Europe but in North America, plunging oil price has forced international oil and gas com-panies to invest less in risky ventures - of which the European unconventional gas is a part. This resulted in much-publi-cized pull-outs like Chevron’s from Pol-ish and Romanian shale gas in January.

But conventional gas also appears to get hit. According to Capgemini’s 16th Euro-pean Energy Markets Observatory, natu-ral gas production in the EU-28 decreased, albeit slightly by 0.5 percent to 167.4 bcm in 2013. A fall of 2.1 percent in 2015 is expected in Cedigaz’ February medium and long term natural gas outlook.

In key European markets, the situation is more alarming. The hydrocarbons output from the North Sea, which for decades has played a key role in the Eu-ropean energy supply, fell 35% from 4 MMboe/d to 2.6 Mmboe/d between 2000 and 2012. The decline is due to depleted fields and aging infrastructure.

According to the International Asso-ciation of Oil and Gas Producers (IOGP), Europe has recently seen a reduced num-ber of investments in the activity of ex-ploring for new reserves of oil and gas, with an exception of Norway.

Despite the substantial remaining potential for hydrocarbon discoveries, every year across the EU fewer and fewer wells are being drilled, leading to less indigenous production of energy. “Without new discoveries the decline trend is set to continue,” the IOGP noted.

According to the IOGP, the European natural gas basins are maturing, with

their prospects on the decrease, while at the same time the cost of drilling and development has gone up. This may have been offset a little by the depressed price of crude oil, but still “anticipated returns from potential small field developments are often considered too low and this negatively impacts the attractiveness of working in these areas,” the IOGP noted in its 2014 report on gas exploration in Europe.

DECLINING RESERVESA high cost of exploration is also imped-

ing investment in drilling that could potentially point to new reserves. Eu-rope’s proven reserves of gas dropped at a rate of 52 percent between 2003-2013 with the trend not expected to change “unless major discoveries occur,” Cap-gemini noted.

Other problems have to do with the regulatory framework and the industry’s ability to attract financing of its operations.

Access to finance for smaller operators, as well as fiscal unpredictability and ac-cess to infrastructure remain a problem. In southern Europe and eastern Europe the obstacles are more to do with the length of time it takes to obtain explora-

tion permits from the authorities, and the complexity of the processes, com-bined with local protests from campaign groups, the IOGP noted.

“If Europe is to maximize its eco-nomic production of oil and gas, more attention should be paid to fostering a climate that attracts investment and recognises the importance of exploration in ultimately delivering new sources of energy supply,” the IOGP observed.

THE LIQUID THREATIt may not be easy to attain what the IOGP is rooting for. Apart from unfavorable economics of exploration, the policy pres-sures stemming from the EU’s decar-bonisation ambitions, and the climate change reducing demand for gas for heat-ing, the potential of EU’s indigenous production of gas is also hampered by the prospect of mass LNG imports to Europe.

According to Capgemini, in 2013, LNG imports in Europe decreased by 28.2% compared to 2012, which ac-counted for a total of 41.5 bcm (net) imported. This was mainly due to slug-gish economic conditions and the in-creased competitiveness of coal-fired power generation.

However, with North Sea production declining, unstable situation in Ukraine, fear of high dependence on Russian sup-

Carbon emissions are too cheap at the

moment for coal-powered energy sector to bother

about them, which in turn puts more

expensive gas under pressure

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With demand on the decrease and considerable amounts of gas available on global markets, Europe seems little incentivized to invest in production.

SOURCE: BP, CEDIGAZ

GAS PRODUCTION IN THE EU

ANNUAL, BCM


plies and nuclear energy being out of favour after the Fukushima disaster, the EU mem-ber states are keen to invest in LNG termi-nals to ensure diversification and security of supplies. This may further complicate the picture of European gas exploration, as looming imports of LNG may be beneficial from the demand point of view, but may discourage exploration efforts.

Several European countries plan to extend capacity of their existing LNG terminals and also plan to build new fa-cilities. According to Gas Infrastructure Europe, there are 29 existing and opera-tional import LNG terminals in Europe. Another 12 LNG terminals are under construction and 27 are planned.

According to Eurogas, 51 percent of LNG imports to Europe in 2013 came from Qatar. Algeria supplied 21.5 percent, Nigeria 12.3 percent, and Trinidad & Tobago 4.9 percent.

In terms of demand-side risks for LNG, there are two main principal risks, uncer-tain growth of gas demand in Europe which last year felt by 11 percent, and “gas on gas” competition, where the same re-source from different sources and points of origin is competing for markets.

STRANDED PIPES Because of the increasing tension between Russia and Ukraine, EU has been seen to put forward plans to wean itself off Rus-sian energy.

To that end, the EU is investing in 248 so-called projects of common interest (PCI’s) - in other words, projects of cross-border importance for the EU member states, funded by Connecting Europe Facility - out of which as many as 110 are related to storage of transportation of gas.

Development of this many gas infra-structure projects is estimated to cost about EUR 70 billion by 2020. According to BP statistical review, with gas getting more expensive and other, more sustain-able sources of energy becoming cheap-er, these infrastructure projects may not

quite pass test for economic feasibility.“Gas pipelines paid for by the Con-

necting Europe Facility (CEF) will be left stranded because there will not be enough demand for the gas they trans-port,” according to environmental think tank E3G.

“EU predictions to assess potential pipelines assume a 72 percent higher gas demand than their projections where the EU’s 2030 energy efficiency goals are met,” an E3G study found in 2014.“

The European Commission estimates energy efficiency measures could reduce EU gas imports by 174 Mtoe per year by 2030. That’s about 20 times more than projected import volumes from the

Southern Gas Corridor, the EU’s flagship infrastructure project, EurActive report-ed in 2014.

It is also twice the projected import capacity of all the gas projects currently under consideration for funding under the Connecting Europe Facility (CEF).These infrastructure investments may also create new dependencies. The new gas imports will increase European de-pendence on supplies from countries like Azerbaijan, Algeria, Qatar and Nigeria, which are perceived as relatively unstable.

OUTLOOK: A NEW HOPE?Anyone who is optimistic that gas de-mand will grow in Europe should be

taken to task. In our view, the gas sector in Europe has its best years of growth behind.

There are too many significant factors for the situation on the European gas market to improve quickly. If there is anything to look forward to, the following factors could change the current difficult situation for better.

The importance of coal will peak by 2020 to the advantage of gas, despite in-creasing share of renewables in the Eu-ropean energy mix. In the longer term, natural gas-fired power generation costs will tend to equalize those of coal in a context of rising CO2 price.

The EU’s environmental policy, which plays a controversial role now in the con-text of the gas sector’s future, may help swing the pendulum in the opposite di-rection long term. Natural gas in the power sector could return to growth after 2020, owing to impacts of directives on large combustion plants and industrial emissions, nuclear phase out (although that one is not a given), coal plants clo-sures and retirements, as well as backing up renewables.

According to Cedigaz, natural gas con-sumption in the transport sector (CNG along with LNG for heavy goods vehicles and shipping) is expected to grow sixfold by 2035. It will remain concentrated in a few countries (Italy and Germany), as policy intervention is needed for this market to really take off across Europe. At the moment, this sector plays a rather insignificant role.

According to a 2014 study on the future of gas demand in Europe by the Oxford Institute of Energy Studies, “outlook for the gas industry includes the potential for modest future growth… but it is unlikely to see a return to 1990s/2000s growth rates.” Perhaps it is time to acknowledge that - apart from all the counter factors at play - that the European gas market has now entered its maturity stage, where a given growth is no longer.

The EU’s environmental policy, which plays a controversial role now in the

context of gas sector’s future, may help swing the pendulum in the opposite

direction long term.

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LNG IMPORTS

After recent falls, 2015 could see LNG imports pick up again

SOURCE: BP, GIIGNL

ANNUAL, BCM

POLAND

SWEDEN

UNITEDKINGDOM

DENMARK

GERMANY

SPAIN

FRANCE

CZECH REPUBLIC

HUNGARY

ROMANIASLOVENIA

LITHUANIA

CROATIA

SLOVAKIA

LATVIA

BULGARIA

SWITZERLAND

IRELAND

NETHERLANDS

UKRAINE

BELARUS

RUSSIA

RUSSIA

ITALY

AUSTRIA

PORTUGAL

BELGIUM

ESTONIA

FINLAND

BOSNIASERBIA

MACEDONIA

ALBANIA

MONTENEGRO

GREECE TURKEY

NORWAY

SCOTLAND

EU-28 BASINS

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POLAND

SWEDEN

UNITEDKINGDOM

DENMARK

GERMANY

SPAIN

FRANCE

CZECH REPUBLIC

HUNGARY

ROMANIASLOVENIA

LITHUANIA

CROATIA

SLOVAKIA

LATVIA

BULGARIA

SWITZERLAND

IRELAND

NETHERLANDS

UKRAINE

BELARUS

RUSSIA

RUSSIA

ITALY

AUSTRIA

PORTUGAL

BELGIUM

ESTONIA

FINLAND

BOSNIASERBIA

MACEDONIA

ALBANIA

MONTENEGRO

GREECE TURKEY

NORWAY

SCOTLAND

EU-28 BASINS

LUXEMBURG



DATA OFFER:





IT WAS NOT long before the fall-ing oil price hit unconventional oil and gas exploration in Europe.

When the oil price started its tumble in June 2014, it took oil and gas com-panies less than two quarters to an-nounce scaling down their investment programs in the more risky sectors, and unconventional exploration has taken a hit, as companies face impaired cash flows.

From in June 2014, the oil price (Brent) has fallen from $112/barrel (bbl) to $66/bbl in early May. There is an array of factors that came to play - indeed a perfect storm - which has resulted in the decrease in price.

THE LOW DEMANDThe origins of the oil crisis - though who considers this a crisis is far from universal - should be tracked to the US’ moving ahead of the OPEC countries as the world’s largest oil producer. The US shale oil and gas boom in Pennsyl-vania, Texas, or North Dakota, pro-pelled domestic oil and gas production to the highest level in three decades. According to EIA, crude oil production accounted for 9.4 million barrels a day in Feb 2015, a major growth over 5.2 million barrels a day in 2005. Similarly, at the end of 2014, natural gas produc-

tion in the US came in at 773 billion cubic meters (bcm), as compared to 535 bcm in 2005.

Rising domestic oil production pushed oil from Saudi Arabia, Nigeria or Algeria out of the US market and made it compete for buyers in Asia, forcing producers to reduce prices.

Secondly, the demand for oil of the world’s second largest consumer, China, has almost flattened. The coun-try’s petroleum consumption is ex-pected to reach 503 million tonnes in 2014, up by 1.1 percent year on year, the lowest growth for the past ten years, according to data from ICIS, a market analytics company. The demand drop-ping in China could be linked - though not exclusively - to slightly slower than expected economic growth of 7.4 per-cent in 2014.

Finally, over the last two decades, Europe has seen a reduced demand for energy - coal and oil in particular, but also gas (see separate story on p. 20) - as the European energy mix is under-going transformation marked by an increase in renewables and improving energy efficiency.

According to a Eurostat report from February, primary energy consumption in the EU-28 is currently at the level last recorded 25 years ago, in 1990,

Europe is still to see an unconventional gas exploration well yield commercial-scale gas flow. This is because too few wells have been drilled to figure out how to fine-tune unconventional technology to the geology. As long as the low oil price discourages investment, the number of wells is unlikely to pick up.

B Y P I O T R W D O W I Ń S K I

Plunging oil price hits Europe’s shale gas


having decreased by 0.2 percent be-tween 1990 and 2013. During that period, primary energy consumption peaked in 2006 and then fell by 8.8 percent by 2013.

Macroeconomics also played a role. The fall in consumption of energy was strengthened by the economic crisis of the early 2009 that the EU is still to shake off entirely. The economy of the EU-28 grew only 1.5 percent in 2014.

Europe’s decreasing demand for en-ergy means that coal and oil are losers. According to Eurostat, in the period of 1990 to 2013, consumption of coal and coal products decreased by 37.1 per-cent, while consumption of oil (includ-ing petroleum products) decreased by 14 percent.

In the same period of time, consump-tion of renewable energy increased by over 175 percent, consumption of natural gas (including manufactured gases) grew by 32 percent and con-sumption of nuclear energy also grew, with the growth coming in at just over 10 percent.

THE OVERSUPPLYWith the oil price sliding, history would suggest that the oil-exporting countries grouped in OPEC, would cut produc-tion. But in late November 2014, during

a meeting in OPEC’s Vienna headquar-ters, members of the group agreed to keep their daily output at 30 million barrels per day (mb/d), a decision which had been agreed in late 2011.

OPEC’s decision was made in the name of “stable oil prices at a level

which did not affect global economic growth but which, at the same time, allowed producers to receive a decent income and to invest to meet future demand, were vital for world eco-nomic well-being,” OPEC said in a release.

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OPEC’s maintaining production at the level of 2011 - which might prevent prices from going back up until at least 2016 - is the price that the group is willing to pay in order not to lose its market share, analysts say.

That in turn was widely interpreted as a means to pose a challenge to US shale oil producers, whose oil did eat into OPEC-dominated markets. “If the shale oil producers keep their current production level without further growth in 2015 (like OPEC did), the market will stabilize. It’s not logical nor fair to ask OPEC to reduce their pro-duction and not ask the other produc-ers to stop their expected growth in supply”, United Arab Emirates’ Energy Minister Suhail Al-Mazrouei told Bloomberg in December 2014.

As a result, the US oil and gas prices have been trending down, the latter due to a surge in production that shale companies were not legally allowed to export until recently.

This had a knock-on effect on US shale gas operators who are seen cut-ting back on exploration and produc-tion spending, even if the decreasing number of rigs has not yet resulted in short-term lower production. Accord-ing to data from Baker Hughes, the number of rigs in North America -

“The Energy Union project is the most ambitious energy project since the

European Coal and Steel Community”

Maroš Šefcovic, EU Commissioner for Energy Union

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where most would be US shale gas rigs - has fallen considerably in the first months of 2015.

But the US production may not fall at all in the end. In late January, the US Congress passed legislation enabling export of gas, which is expected to re-duce the gas glut in the US. The US gas - now turned into LNG - is set to flow to foreign markets, including Europe, where first deals have been signed al-ready, for example by Lithuania.

THE COLLATERAL Falling oil prices coupled with falling demand for energy have hit most vul-nerable parts of the oil and gas industry.

Most oil and gas companies an-nounced cuts in their exploration budgets (see Indicators, p. 14) and concentrated on most promising proj-ects. For Europe, this meant a retreat from shale gas, which had been long under regulatory and public pressure and struggled to gather momentum even before factors like oil price or energy demand came into play.

CONTINENTAL EUROPEIn a widely publicized example, the US major Chevron decided in January and February to abandon shale gas explora-tion in Poland and Romania. The com-pany drilled a total of five wells in those two countries, including four in Poland.

In the case of Romania, the company said it was going to relinquish its conces-sions during 2015. The concessions, located in northeast and southeast of the country, were Chevron’s last shale assets in Europe.

Chevron stated that “the opportunities in Poland no longer compete favorably with other opportunities in Chevron’s global portfolio”.

This has left shale gas exploration in Poland in the hands of two state-con-trolled companies PGNiG and Orlen Upstream, as well as independents San

Leon Energy and BNK Petroleum. The only major left is ConocoPhillips, al-though they announced a global 33% cut in exploration expenditure in Febru-ary, which is likely to hit Poland.

Apart from Poland, the shale gas story elsewhere in the continental EU is rather unimpressive. The only shale gas project in Denmark, run by French oil and gas major Total, has been delaye due to alleged problems with unauthorized use of chemicals on-site. In Hungary, a bidding round, which is expected to be announced in the first half of 2015, will aim to attract shale gas investors from US and Asia, but the scope of their inter-est is unknown.

UNITED KINGDOMEarly in 2015 in the United Kingdom, the future of shale gas exploration was hanging on a new infrastructure bill that went through a cycle of alternating ver-

sions that would restrict fracking and then restore more liberal regulations. Eventually, the House of Lords, which is the upper house of the UK parliament, allowed fracking under sensitive areas such as national parks or areas of out-standing natural beauty, as long as the well pad is off-site.

The Lords also removed a provision making environmental impact assess-ments mandatory, as well as a require-ment to monitor emissions other than

methane.The future of fracking in England will

only be affirmed after the UK’s general election taking place in May. Following the vote in the House of Lords, disap-pointed anti-fracking campaigners are now calling for the Labour party to impose a blanket ban on the technology in case they form the next government.

Other parts of the UK do not share the current Tory government’s outlook on shale gas. The Welsh government called upon a ban on fracking in early February, even though the powers in the energy sector are not devolved to Car-diff.

In late January, the more powerful Scottish government imposed morato-

rium on hydraulic fracturing, which has put the future of shale gas in Scotland under a big question mark.

The moratorium played havoc with the plans of INEOS Upstream, the un-conventional oil and gas subsidiary of Swiss chemicals giant INEOS, which had two licenses targeting shale gas in Scot-land located near the company’s Grang-emouth refinery plant.

While INEOS is currently building Europe’s largest natural gas import facil-

RIG COUNT (APR 2015 YOY CHANGE)

Location 2015 2014 +/-

North America 1011 2029 -1018

SOURCE: BAKER HUGHES

WHY EU UNCONVENTIONALS ARE GETTING LESS INTEREST

Range Reason Direct effect Knock on effect

GlobalLow oil price

of USD60-65/bbl

Global exploration investment cut

of EUR 103 billions

Decrease in activity of shale gas exploration in EU

ScotlandPublic concerns and pressure

from environmentalist on fracking

Imposed moratoriums on hydraulic fracking

Unconv. exploration on hold

HollandShale gas research needs

more timeThe Netherlands extended

existing ban until 2017Unconv. exploration on hold

Poland Complex geologyDespite 70 exploration

wells, none are com-mercial

Shale gas estimates significantly downgraded

SOURCE: CLEANTECH


ity to feed its petrochemicals plant at Grangemouth with US shale gas, the company still wants to produce gas from shales at home. “When you are shipping in material from overseas you are always at a disadvantage. It is a very special situation at the moment, with ethane being available in the US at very low prices, because of the rapid increase in production and the lack of demand in the US,, We can’t see that going on,” INEOS’ CEO Gary Haywood told an industry conference in Edinburgh in February.

Despite regulatory setback in Scotland, the company appears to believe that it can still take its shale gas project off the ground in England instead.

INEOS’ unconventional oil and gas subsidiary INEOS Upstream has re-cently agreed to pay IGas around EUR40 million for stakes in several IGas’ li-cences in England and Scotland as well as fund a two-phase work programme of up to EUR195 million to appraise and develop the newly acquired acreage. The deal will move INEOS to third place in the UK in terms of UK shale gas li-censes with potential shale gas reserves.

SHALE GAS IN ENERGY UNIONThe unconventional oil and gas industry in Europe has some hopes attached to the EU’s Energy Union project. The Energy Union is, in short, an idea to boost EU’s energy security by improving energy efficiency and reducing import of energy, for which the EU was depen-dent in 53 percent in 2013, at a price tag of some EUR400 billion (see map).

In February, the European Commission adopted a strategy on the energy union, which mentioned unconventional oil and gas in the context of domestically pro-duced energy as a means to reduce the EU’s energy import dependence. Shale gas is perceived as an option next to con-ventional sources, provided that issues of public acceptance and environmental

impact are adequately addressed, the energy union strategy document states.

WILL EXPLORATION PICK UP?British domestic gas production is fall-ing as the North Sea production de-clines. According to UK oil and gas giant BP, in the period between 2000 and 2012, oil production declined from 3 million barrels per day (mb/d) to 1 mb/d.

The remaining fields are old and mostly tapped out. Newer fields are smaller and more difficult to produce. This should - in theory - play to the hands of the fledgling unconventional oil and gas industry in Britain, as the government continues to see uncon-ventionals as a possible solution for make up for the North Sea’s dwindling output, provided that obstacles referred to earlier in this analysis are overcome.

Even though the public opinion’s view on fracking varies in the polls, the majority of UK politicians wants frack-ing. In January, the UK MPs held a vote on the technology that included a pro-posal to hold a UK-wide moratorium on the industry. Only 52 out of 650 MPs voted to stop fracking.

Poland has 70 shale gas wells drilled to date, with a handful showing some gas flows, though far from commercial level required by operators. Companies that remain active and politicians alike maintain that exploration must con-tinue (see also p. 48).

Elsewhere, there are some feeble signs of hope for shale gas. After a long debate over the use of fracking in Ger-many, the government tabled a draft law allowing the technology. However, it is not clear whether regulations on fracking aim at making shale gas frack-ing “less risky” for environment or rather creating rules that would be too strict for potential explorers to con-sider getting involved.

Maria Krautzberger, the president of Germany’s federal environment agen-cy UBA told the SGIG that “it might be that these new strict rules will ren-der shale gas exploration economi-cally unfeasible. Germany’s long term policy is to be a carbon-neutral state. If there are companies in Germany able to meet any strict requirements for fracking, they will be free to explore.” The first exploration works after lifting the current ban are due after 2020.

POLAND

SWEDEN

UNITEDKINGDOM

DENMARK

GERMANY

SPAIN

FRANCE

CZECH REPUBLIC

HUNGARY

ROMANIA

SLOVENIA

LITHUANIA

CROATIA

SLOVAKIA

LATVIA

BULGARIA

SWITZERLAND

IRELAND

NETHERLANDS

UKRAINE

BELARUS

RUSSIA

RUSSIA

ITALY

AUSTRIA

PORTUGAL

BELGIUM

ESTONIA

FINLAND

LUXEMBURG

BOSNIASERBIA

MACEDONIA

ALBANIA

MONTENEGRO

GREECE TURKEY

NORWAY

>75

50-75

25-50

<25

The EU member states are in favorable position if their dependence on imported energy is either below 50 percent or if the imports come from stable markets. Several EU countries depend on imported energy in at least 75 percent, including ones sourcing it from Russia, with which relationships have become sour recently.

HOOKED ON IMPORTSENERGY IMPORTS, %

SHARE OFIMPORTEDENERGY, %

SOURCE: EUROPEAN COMISSION


TRENDING

PGNIG, Poland’s state-controlled oil and gas company discovered an estimated 1-1.5 billion cubic meters (bcm) of tight gas on the Wronki concession, near the western Polish city of Poznań. The find is one of the first tight gas reservoirs found in Poland. Geological data verification, more accurate reservoir estimates and planning of further work will take several months, PGNi G said in a release. The company indi-cated, however, that tight gas deposits require larger ex-penditure throughout the exploration and appraisal phase due to their worse production parameters. Production of tight gas also involves additional technical operations. PGNiG’s Pniewy-4 well was drilled between April and June 2013 and fracked at the end of November 2014. Poland might have 153-200 bcm of recoverable tight gas. For comparison, Poland’s proven recoverable con-ventional natural gas resources equal 134 bcm, a rough equivalent of eight years of annual consumption.

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Gas gone wild

Dec 19/15

Netherlands and Quebec impose fracking moratoriums

Dec 29/15

US natural gas prices fall below $3/mmBtu

Jan 23/15

BHP Billiton cuts US onshore shale oil rigs by 40%

Jan 13/15

SCOTLAND ESCAPES UK SHALE REGULATIONS

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Not near my castle

THE UK GOVERNMENT agreed to exclude Scotland from the so-called Infrastructure Bill that would allow easier underground access to potential shale gas acreage near residential areas. Following objections raised jointly by the Scottish gov-ernment and the opposition Labour and Green parties, Scotland retained the current regulation restricting drill-ing near residential areas. Rather than amend the so-called Infrastructure Bill to transfer full powers over shale gas exploration to the Scottish Parliament ahead of the gen-eral election, as proposed by the Labour party, the UK coalition government chose to simply exclude Scotland from the impending legislation. “We’re glad the UK Government has finally taken this on board - especially as 99 percent of respondents to their own consultation also opposed the move,” said Tom Grea-trex, a Scottish Labour MP. Later in the same moth, Sctoland went ahead and in-stituted a blanket ban on shale gas E&P (see p. 36).

Jan 1/15

Lithuania’s LNG terminal starts operations

Dec 9/14

POLAND’S PGNIG DISCOVERS TIGHT GAS


Feb 4/15

Russia no longer Ukraine’s chief gas

supplier in January

Jan 21/15

San Leon completes second well on its Bielsko-Biała concession

Jan 23/15

BHP Billiton cuts US onshore shale oil rigs by 40%

Feb 12/15

UK DOES U-TURN ON FRACKING RESTRICTIONS

THE HOUSE OF LORDS revoked the ban on horizon-tal drilling and fracking under national parks and other protected areas in a number of amendments to the in-frastructure law. The amendments in question cancel out the earlier version of the law, passed in the House of Commons, which ruled out fracking in national parks, areas of outstanding natural beauty, sites of special scientific interest and groundwater source protection zones. The new law also removed several administrative requirements, such as notifying residents on upcoming shale gas operations, keeping records of gas leaks other than methane and the need to prepare environmental impact assessments of the drilling sites, as reported by the Guardian. An estimated 45 percent of acreage shale gas compa-nies could bid for in last year’s licensing round were at least half-covered by now overturned restrictions.

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Better to burn out than to fade away

Jan 30/15

CHEVRON GIVES UP ON EUROPEAN SHALES

CHEVRON ABANDONED its shale exploration op-erations in Poland and Romania that were the US’ major last shale assets in Europe, the company an-nounced during January and February. Chevron indicated that low oil prices undercut its Q4 2014 profits by 30 percent, as compared to the previous year and that the “opportunities here [in Poland] no longer compete favorably with other opportunities in Chevron’s global portfolio”. The announcement proved another one in a series, after Chevron’s withdrawal from shale gas exploration in Lithuania, as well as pull-out frm an agreement to explore the Oleska shale play in western Ukraine. Chevron’s decision made headlines as a potentially fatal blow to shale gas in Europe. Market observers say however that the potential of shale and other unconven-tionals in Europe remains, only its size is better suited to smaller oil and gas companies, not majors like Chevron.

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The lord of the day

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TRENDING

THE GERMAN GOVERNMENT proposed a draft law that could end the current countrywide moratorium on the use of hydraulic fracturing. If signed into law, new regulations could allow shale gas exploration to start from 2019. Proposed rules would institute a six-person expert panel with power to greenlight exploration, including fracking, in wells up to 3,000 meters deep. Critics are challenging the expert panel’s impartiality, pointing out that half of the proposed experts had signed the Hanover Declaration, a statement of support for shale development in Germany. The proposal is also criticized as a step away from Germany’s policy of transition toward reliance on renewable energy, known as Energiewende. Currently, fracking is banned at depths of up to 3,000 meters, unless done for scientific purposes. This morato-rium is scheduled to last until 2021 unless the current proposal enters into force, which is expected around 2019.

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Ready. Set. Wait five years

Feb 27/15

LITHUANIA CONTRACTS CHENIERE FOR LNG SUPPLY

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Yankee on the way

LITHUANIA IS BECOMING a regional LNG hub, hav-ing secured a master trade agreement with US Cheniere Energy on February 27. The deal has Cheniere on con-tract to LNG to the Lithuanian LNG terminal from 2016 “This agreement is very important. The company is building the first US natural gas liquefaction and export terminal which will be operational late 2015, and will provide us access to the prolific US natural gas market”, said Dominykas Tuckus, general manager of Litgas, the state controlled operator of the Lithuanian LNG termi-nal. The expansion of import capacity goes hand in hand with increased capability of reselling in the Baltic region. Also in February, Litgas was granted permission to trade natural gas in Estonia by the Estonian Competition authority and secured transit through Latvia via an agreement with Latvian gas monopolist Latvijas Gaze. Litgas expects to send up to 30 million cubic meters of gas to Estonia by the end of 2015.

Mar 3/15

Lane Energy to plug five wells in Poland

Feb 16/15

GERMANY TABLES NEW FRACKING RULES

Feb 12/15

E.ON seals deals to export LNG from U.S.

Feb 25/15

EU reveals energy union package


Mar 30/15

BNK relinquishes Bytów concession in Poland

Apr 13/15

Gazprom’s price cut prompts Lithuania to

mull re-exporting LNG

Mar 23/15

US tightens rules for fracking on public land

April 7/15

SHELL ACQUIRES BG GROUP FOR €65 BILLION

ROYAL DUTCH SHELL agreed to buy BG Group, former British Gas’ oil & gas exploration arm, for EUR65 billion. It is the single biggest oil & gas deal since Exxon’s 1998 acquisition of Mobil, and if its completion is not hampered by anti-trust laws, it will create a group of capitalization of nearly EUR278 billion. Shell expects BG Group’s assets to increase its oil & gas reserves by 25 percent and boost its hydrocarbon production capacity by 20 percent. Via BG Group’s takeover, Shell will also acquire Aus-tralian gas assets estimated at 690,000 barrels of oil (bbl)equivalent per day and the rights to the first sizable shipments of LNG from the US to overseas buyers, thanks to BG Group agreement with Cheniere Energy. The acquisition of the Australian assets is seen as a gamble on long-term growth of Asian LNG demand, currently at its lowest since 2011 at less than $7 (EUR6.2) per million British Thermal Units (mmBtu).

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Switzerland, Scotland, shale

Mar 10/15

INEOS IN IGAS FARM-IN DEAL WORTH €40 MILLION

INEOS, A SWISS-BASED chemicals group, signed a £30 million (€40 million) deal with IGas, UK’s biggest shale gas explorer by acreage, to acquire 50-60% stake in IGas’ seven licence areas in northwest England. The agreement marks the beginning of Ineos’ ambitious shale gas explora-tion campaign, during which the company plans to spend £138 million (EUR186 million) in the next few years. The licenses in question include land where drilling permission has already been granted, Chester and Elles-mere Port in Cheshire and a site next to the M6 motor-way’s Thelwall Viaduct, west of Manchester. Ineos may spud up to 10 exploratory wells on the new acreage. Ineos will also acquire IGas’ entire stake in the shale licence around the Grangemouth refinery in Scotland, giving the Swiss firm full ownership of the site. Ineos already holds two shale licences in Scotland and has applied for more licenses as part of the UK’s 14th onshore licensing round.

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Gas gambler

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THE FIRST QUARTER of 2015 will be remembered for the UK finally giving the shale gas indus-

try the bolster it needed to kick start it into action.

The introduction of the Infrastruc-ture Act and the Parliament’s rejection of an amendment to introduce a moratorium in England has been applauded by the industry.

David Petrie, communications man-ager from IGas told the SGIG that what the government has delivered so far signifies that it has “recognised that domestic gas will form a key part of Britain’s energy mix for years to come.”

“The Act also gives welcome clar-ity with respect to land access rights and trespass, and reinforces in law existing industry best practice and, as such, reinforced the UK’s high standard of regulation of our indus-try,” Mr. Petrie said.

AFTER THE ELECTIONS With regards to policy stability in the UK, however, Mr. Petrie says that there are elements that will not be known until after the general election, which is taking place in May.

These details include within which groundwater protection zones and other protected areas fracking will be permitted, which would be ultimate-ly decided by the Secretary of State for Energy, in consultation with the Environment Agency, by 31 July 2015 at the latest, so likely in a new politi-cal situation.

The three mainstream political par-ties, Conservatives, Liberal Democrats and Labour continue to promise to uphold the Infrastructure Act, although the differences in their approach could weigh in a lot in terms of how easy - or not - it will be to extract shale gas in the UK.

The Conservative Party believes it can secure the UK’s energy supply through shale gas. In February, Mat-

thew Hancock, Minister of State for Business and Enterprise, told the EEF manufacturers’ association that the Tories “will secure Britain’s energy sup-plies and start to unlock the shale wealth deep underground.”

LABOUR’S CONDITIONSA Labour Party spokesperson told the SGIG that gas has a role to play in the UK’s future energy mix, but it will ensure

The UK government did a U-turn on its own idea to restrict fracking from some 40 percent of potential shale acreage, thus avoiding a likely kiss of death for industry troubled with enough problems.

N I L I M A C H O U D H U R Y I N L O N D O N

Relaxed Rules

F R A C K I N G I N T H E U K

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the right safeguards are in place before any shale gas extraction goes ahead.

“We are clear that there should be no fracking until the environmental framework is fit for purpose, and that any shale gas development must go hand in hand with Carbon Capture and Storage and renewables projects,” said the spokesperson.

“There must be a system of robust regulation and comprehensive inspec-tion before any drilling to explore or extract unconventional gas is permit-ted. That is why we tabled an amend-ment to the Infrastructure Bill that would have prevented fracking under groundwater protection zones, or within protected areas such as na-tional parks,” the spokesperson said.

Labour’s conditions would make Environmental Impact Assessments mandatory at all sites, which would require residents to be notified on an individual basis of shale gas operations, and all fugitive emissions would have to be recorded, not just methane.

In addition, Labour has promised to devolve powers over fracking to Wales, which could lead to the country placing a moratorium, as Scotland has already.

In a similar vein to Labour, the Lib-eral Democrats intend to see the frack-ing industry heavily regulated, but see gas from shales as a means to bolster domestic economy and solve some wider geopolitical issues rife in today’s Europe.

“The evidence says we need gas as we decarbonise. Do you want Putin’s gas, do you want Middle East gas, or do you want gas from Britain?” former Secretary of State for Energy and Cli-mate Change and Liberal Democrat MP, Ed Davey said in an interview with the Carbon Brief in January.

“If we have gas for Britain, shale, conventional, non-conventional, on-shore or offshore - guess what? We can

regulate it a lot better than the gas we’re going to get from abroad. So we can cut down on methane emissions and make sure health and safety and other environmental issues are dealt with more effectively,” Mr. Davey also said.

ALIGNED SOMEWHATThis general alignment between the main political parties in the UK prob-ably led to IGas’ announcement in March that it has signed a £30 million (€40 million) deal with INEOS, which will see the Swiss company acquire 50 percent in IGas’ working interest in the Midlands region of the UK.

“We believe shale gas could revolu-tionize UK manufacturing and Ineos has the resources to make it happen, the skills to extract the gas safely and the vision to realise that everyone must share in the rewards for UK shale gas to be successfully developed,” Gary Haywood, chief executive of Ineos Upstream, said in a statement.

One of the most vocal of the minor-ity parties UKIP is pro-fracking and has promised to introduce a “Com-munity Improvement Levy”, earmark-ing money from the development of shale gas fields for lower council taxes or community projects within the local authority. On the opposite end of the spectrum there is the Green Party which wholly opposes fracking, listing it as incompatible with climate change policies forfeiting clean energy invest-ment, bad for manufacturing and damaging to rural communities.

Editor’s note: The UK election results were out hours before this issue of the SGIG went to press. In a surprise result, the Conservative Party won the election, securing 330 seats in the 650-seat House of Commons. The Tories thus have a clear majority. Labour came second with 232 seats, the Scottish National Party has 56 seats, Lib-Dems eight, while Ukip just one.

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“If we have gas for Britain, conventional, non-conventional - guess what? We can

regulate better than the gas from abroad”Ed Davey, MP, Liberal Democrats

UK

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THE GLACIAL pace of shale gas exploration in Poland in the past five years has successfully eroded

most of the initial optimism regarding country’s potential for unconven-tional hydrocarbons. Prolonged tech-nical and regulatory difficulties, un-derscored by high-profile foreign operators - ExxonMobil, 3Legs Re-sources and Chevron - giving up, prompted some to proclaim the in-dustry a dead man walking.

Despite having little in terms of suc-cess, the search for shale gas revealed there might be other opportunities for commercial exploitation - both con-ventional and not - right around the corner. In July 2014, John Buggenha-gen, former Exploration Director of San Leon, returned to Poland with his new company, Palomar Natural Re-sources, to develop the Siekierki gas field, where tight gas reserves were found back in 2010.

PGNiG, Poland’s state-controlled oil and gas company, also stumbled onto

over a billion cubic meters (bcm) of tight gas on its Wronki concession in December 2014.

Both finds were considered isolated occurrences, with tight gas exploration remaining on the back burner for the foreseeable future. Yet, that might change in the light of Poland Geological Insti-tute’s (PGI) most recent report, claiming that the country’s tight gas potential might exceed what currently can be extracted from conventional gas fields.

The report, unveiled in March, iden-tifies three major geological forma-tions: Permian and Carboniferous sandstones in western Poland and a smaller Sambrian formation in the western part of the Baltic Basin. The fourth area, Zapadliska Karpackie, was recognized as having a potential, but was not covered by the research yet.

Both tight gas finds to date - PGNiG’s Pniewy well and the joint Palomar-San Leon Trzek wellbore - are located on the edge of the Permian formation near Poznań (see map).

After shale, tight gas fuels imagination in Poland

T I G H T G A S

Poland might have one more shot at unlocking its unconventional hydrocarbon potential. The latest estimates claim that country’s recoverable tight gas reserves are likely bigger than its conventional resource.

B Y G A B O R C H O D K O W S K I - G Y U R I C S


THE POTENTIALThe three prospective areas are esti-mated to hold between 1,528 and 1,995 bcm of gas, of which from 153 to 200 bcm should be recoverable, assuming a typical 10-percent recovery ratio achieved in tight gas markets abroad. For comparison, Poland’s proven recoverable conventional natural gas resources equal 134 bcm, a rough equivalent of eight years of annual consumption.

Geological data for the survey was gathered from over 500 research and exploration wells drilled in recent years, including those spudded in search of other unconventional resources, of which about 30 yielded archive geological-reservoir data.

Tight gas was the first unconventional gas to be developed and today it accounts for 18% of overall natural gas production in the United States. It is found primar-ily in sandstone, and sometimes carbon-ate rock, formations of unusually low porosity. Tight gas production requires hydraulic fracturing, just like shale gas, but is generally considered to be easier technically.

CHALLENGES“I do not want to inflate dreams, because it may turn out that we are not the second Kuwait or Qatar. Everything indicates that we will be successful, but the success will be scaled to the Polish needs and it won’t happen overnight,” Sławomir Brodziński, the deputy minister of the environment, told PAP.

The wary pessimism is hardly surpris-ing, considering how unrealistic the early hopes and expectations about Po-land’s unconventional hydrocarbon de-velopment proved to be.

It is hard to imagine that operators and investors, already disenchanted by unsuc-cessful pursuit of grossly overestimated hydrocarbon reserves, jumping at the opportunity to engage in an even cost-

lier exploration campaign.As is the case with other forms of un-

conventional hydrocarbons, tight gas exploration is a very costly undertaking, further exacerbated by the need to per-form hydraulic fracturing on depths of up to 6,000 meters. By comparison, shale formations are no deeper than 4,500 meters.

Poland’s tight gas exploration has a long way to go: only six wells of this kind have been drilled in the last five years.

Still, those earliest exploration efforts did provide very promising finds. PG-NiG’s Pniewy-4 well yielded enough gas to support an estimate of between 1 and 1.5 bcm of tight gas for the entire play. In the Siekierki gas field, currently under

development by Palomar, test flow of 56-85 thousand cubic meters per day was achieved.

Tight gas exploration has been under-way in several countries for decades, although it has only gained a significant share of total natural gas production in the US, at roughly 20 percent. Tight gas is also extracted in Germany, where it accounts for around 3 percent of total production, as well as in the Netherlands, and Russia.

It remains to be seen if PGNiG or Palomar will see a success in the coming months on their tight gas acreage that could reignite the hopes of Poland estab-lishing a strong, unconventional hydro-carbon industry.

MA

RK

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RUSSIA LITHUANIA

BELARUS

SLOVAKIA

CZECHREPUBLIC

GERMANY Łódź

Poznań

Wrocław

Rzeszów

Olsztyn

Gdańsk

Szczecin

WARSAW

Lublin

Bydgoszcz

Katowice KrakówUKRAINE

“Everything indicates that we will be successful, but the success will be scaled to the Polish needs

and it won’t happen overnight” Sławomir Brodziński, deputy environment minister

The three prospective areas are estimated to hold 1,528-1,995 bcm of tight gas, of which 153-200 bcm “should be recoverable,” according to Polish Geological Institute

TIGHT GAS ELDORADO?

Prospective areasSOURCE: PGI


IT WAS A HOT WINTER in the otherwise cold and windy Scotland in 2014. Hardly did the hot political

heads manage to cool down after the failed independence referendum, when another controversy struck. In January, the Scottish government imposed a ban on hydraulic fracturing, or fracking, for shale gas, citing environmental and health concerns.

The announcement disappointed the oil and gas industry in the UK. Not least because the international chemi-cals giant INEOS - which has a refinery in Grangemouth in central Scotland - announced in 2014 that it would like to tie the refinery’s future to domestic shale gas as raw fuel. To that end, the company has acquired licences for gas exploration nearby the refinery.

POLITICS, NOT SCIENCEThe moratorium comes on the back of Scotland’s government policy, which “strongly endorses the robust regulation of onshore drilling techniques associ-ated with the extraction of shale gas, such as fracking.”

“The Scottish Government approach is underpinned by the principle that the highest levels of environmental protection must be enforced,” read the government’s program document.

The decision on the ban doesn’t hold

water in scientific terms, says Professor Paul Younger, Rankine Chair of engi-neering and Professor of energy engi-neering at the University of Glasgow. The reasoning behind the ban, he sug-gests, is purely political.

“The very greatest disruption which a heavily-fracked well could ever do to the subsurface is miniscule in comparison to what coal mining routinely achieves,” Mr. Younger wrote in an article Fracking Furore is Typhoon in a Tea Cup that first

appeared on the dailybusinessgroup.co.uk website in February.

There are, of course, environmental problems with shale gas operations, but they are small and limited to individu-al well pads, Mr. Younger claims.

“These are problems such as spill-ages of fuel or fracking liquid, but they can easily be handled by existing regu-lations, such as requirement to double-bond fuel tanks. Then there’s vehicle traffic and the use of water, but that doesn’t concern most of Europe, may-be except a few south European coun-tries,” Mr. Younger told the SGIG.

Mr. Younger adds that claims that aquifers are particularly at risk is “utter nonsense”. “Not just because fracking up into such aquifers would destroy the productivity of wells rather than pollute the freshwaters, but more fun-damentally because such aquifers do not exist above the shale gas and coal-bed methane-bearing strata of Scot-land,” Mr. Younger wrote in his article.

“The point is that existing regulations are enough to weed out any problem-atic shale gas projects,” he told the SGIG.

Mr. Younger was on a team of several Scottish academics who the government asked to write a report on unconven-tional oil and gas in Scotland in 2014.

The report’s conclusions with regard to environmental and health impacts

Scotland pushed a blanket moratorium on fracking despite scientists crying foul that the government ignored its own report, which concluded that fracking’s impact is manageable

B Y W O J C I E C H K O Ś Ć

The Report No One Read

S C O T L A N D ’ S S H A L E P O L I C Y

“The best way to assure the long term success of

the Grangemouth site, one of

Scotland’s largest manufacturing businesses, is to develop an

indigenous shale gas resource”

Richard Longden, INEOS


of fracking are that “many of these social (and environmental) impacts can be mitigated if they are carefully con-sidered at the planning application stage. Added to which, there are already considerable legislative safeguards to ensure such impacts are not realised.”

“The government chose to ignore the report and went to lengths to diminish its outreach,” Mr. Younger said.

SHORT FUTUREScotland’s moratorium goes against INEOS’ plans and puts a question mark over mid-term future of the Grange-mouth plant, says INEOS spokesman Richard Longden.

“Grangemouth has 15+ years of as-sured gas supply from the US starting in 2016 which assures the site’s future in the medium term. Predicting what happens beyond this is more difficult,” Mr. Longden told the SGIG.

The American gas comes from the US shale plays, under contracts INEOS signed in 2012 with Range Resources - Appalachia and Sunoco. The US shale gas will be transmitted via the Mariner East pipeline to Marcus Hook terminal in Pennsylvania, where it will be sepa-rated by fractionation and held in stor-age ready for shipment to Europe.

But Grangemouth needs to look at an operational time horizon longer

than 15 years, Mr. Longden said.“The best way to assure the long term

success of the Grangemouth site, one of Scotland’s largest manufacturing businesses, is to develop an indigenous shale gas resource,” Mr. Longden said.

If Scotland can’t get its own shale gas act together, says Mr. Longden, then one can hardly expect that a solution will come from elsewhere.

This could lead to a situation in which Scotland’s oil and gas industry will face losing jobs as North Sea production goes into a sharp downturn, yet there will be no alternative to re-employ oil-men. Such an alternative is unconven-tional oil and gas, Mr. Younger says.

Mr. Younger adds, however, that the government’s ignoring of the report that he co-authored was a result of the stigma surrounding unconventional oil and gas exploration in the UK thrown on the backdrop of Scotland’s uneasy relationship with England.

“In the days following the [referen-dum] campaign, I and other scientists watched our social networks degener-ate into uninformed anti-fracking lob-bies, fuelled by the feeling that fracking could be (mis)construed as a case of incipient English imposition onto Scot-land,” Mr. Younger recalled.

The Scottish government’s minister of business, energy and tourism Fergus

Ewing did not return SGIG’s repeated requests for comment.

With Scottish moratorium appearing to stand, unconventional oil and gas could get a go-ahead in England instead. Politics are also nearly certain to inter-fere, however, with UK’s general election taking place in May.

PHO

TOPI

N

• Oil and gas production outlook by 2019: stable at 196,000toe/day

• Oil and gas capex: 2013-2014: £15.3bln/€20,7bln 2018-2019 (forecast): £9.4bln/€12,7bln

1.4 tcm

COUNTRY FACTS

16 mlnGas production (toe)

421 tcm Shale oil in-place (low est.)

Shale gas in-place (low est.)

€26blnScottish O&G sector, 2012 (13% of GDP)

SOURCE: SCOTTISH GOVERNMENT, DECC


What did we know about shale rock in Poland five years ago, when the frenzy was just begin-

ning?We need to go back to early 2010. Back then, our knowledge about unconven-tional oil and gas in Poland relied on materials obtained during previous 50 years as an aside to research that simply focussed on mapping Poland’s geology. But even this very limited material provided grounds to claim that there is a formation in Poland that might be like one of the US shale plays undergo-ing fast commercialization at the time. That said, even our old knowledge about the key parameter, total organic content (TOC), indicated that Poland’s oil and gas bearing shale formations could only be compared to weakest shale plays in the US.

If we could only compare our shales to weakest US plays, why was there such hype?Three events triggered the Polish shale gas fever. First, the report that the US Energy Information Agency commis-sioned from Advanced Resources, which assessed the Polish shale gas reserves at capable of producing 150 billion cubic meters of gas a year, the

amount that Gazprom sells to Europe each year. That stirred imagination.

Second, the entry into Poland of Exxon Mobil, which, like many other firms at the time, was looking outside of the US to see if the American shale gas story could happen elsewhere. Exxon Mobil is the biggest oil and gas company in the world and once they were granted concessions in Poland, the entire oil and gas industry took notice.

Finally, Poland’s shale gas belt was not covered by the concession regime, be-cause it remained out of focus for Po-land as not promising. So concessions were granted free-hand. With Exxon Mobil in, everybody else also felt that they needed to go in and a domino ef-fect ensued.

Still, ExxonMobil and other compa-nies had only that old geological data, which wasn’t promising. Why did they move in in the first place?The foreign players did not trust old data much, not least because it came from a country without big experience in oil and gas exploration and produc-tion. Most of the data available five years ago was obtained during the Communist era in a very different work

culture. The methodology was also dated by today’s standards. Around half of important criteria that the industry was looking for could come from old data sets. The other half would only become available based on new wells.

The industry was also keen to probe Polish shales for one thing that the data showed clearly. It was that the overall thickness of Polish shale formations is one of the biggest in Europe, coming in at between 1,000-3,000 meters.

Today, several companies are gone because well results were not encour-aging. Are they pulling out for a good reason?I think that today’s pessimism about shale gas in Poland betrays a similar herd mentality like the early frenzy did and is just as overblown. We have now fresh technical knowledge based on data obtained from new wells. But it’s not yet the scale that shale gas industry needs. Out of 70 or so wells drilled to date, around a dozen have been hori-zontal wells that were fracked and it’s only results from those wells that can give you clues about potential of shale gas in Poland. If you take out half of them that experienced serious prob-lems, because companies were learning

With over 70 wells drilled and several fracked, it’s high time to ask questions: do operators know how to adjust exploration to the qualities of the Polish shale? The SGIG speaks to Paweł Poprawa, the geologist who has been following closely the development of unconventionals.

I N T E R V I E W B Y W O J C I E C H K O Ś Ć A N D P I O T R W D O W I Ń S K I

Still Worth It After All These Years

G E O L O G Y


how to frack in Poland, you end up with only a few wells with valid results.

So what do those results say in terms of commercial terms?With those few results, we can map early commercial potential of the Polish shales, based on obtained gas flows. They’re not commercial flows - yet, in my opinion. You are looking for initial production of a shale gas well of 80,000 cubic meters a day. If you get that, you’re close to a commercially viable well. In the case of the best well so far, the Lane Energy/ConocoPhillips Lu-blewo well, we’re at around 14,000-15,000 cubic meters a day plus some barrels of oil.

But that is normal in every new basin. It would take an incredible luck to hit commercial gas flows right at the begin-ning. Each company coming to Poland must have assumed that it was going to take 20-50 wells before they could take a legitimate decision to pull out. But they’re pulling out after a few, so it’s something else that’s driving these de-cisions in my opinion.

What is it?Oil and gas industry is such that com-panies tend to carry out projects that fit their scale, so the biggest companies will only do biggest projects, and so on. Once the biggest players found out that the Polish shale project is unlikely to be on the scale of 150 bcm a year, they shifted elsewhere, where they can carry out projects on a sufficient scale for them. That’s understandable.

But medium and small companies know very well that few wells just doesn’t provide enough data. Nonethe-less they’re pulling out as well and that’s because of the regulatory environment, and all the incompetent ideas - on fis-cal regime, for example - that created atmosphere of instability and a convic-

tion that Poland was trying to push foreign players out of the shale business to keep it for domestic companies only.

What did the companies find out about Polish shale formations by now and how they need to adapt to max out their potential?Two geological challenges need to be overcome. West of Gdańsk, there are very interesting geological conditions with one particular challenge. There are two potentially gas bearing strata

there. The thickness of each - some 15-20 meters - is too small to offer a chance of commercial gas flow. These two strata are separated by some 10 meters of marlstone that does not easily give in to fracking. In order to maximize the potential of shale for-mations that the marlstone separates, you need to frack them at once, meaning you need to design your frack so that it works in marlstone as well.

The other challenge is broader. It’s

that according to new data, we were mistaken so as to where the gas, oil, and liquids windows are located. The gas window is more to the West than we thought, while the condensate and light oil (liquids) window is much bigger. The result is that wells de-signed for the gas window were in the liquids window instead. Companies need to adjust to that and test differ-ent frack designs - of course, the problem is that each design will cost PLN 50 million (€12.4 million).

What’s the outlook for the Polish shale gas now?Each properly fracked horizontal well in Poland has yielded better results. Far from commercial flows, but con-sistently better with each new frack. That means the industry is on a learn-ing curve and it shouldn’t give up. Forget about 150 bcm a year and consider 5 bcm a year. Having that on the market, it would be enough to eliminate Gazprom as supplier. That is still worth going after.

Still Worth It After All These Years

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“The industry is on a learning curve and it shouldn’t give up. Forget about 150 bcm a year and consider

5 bcm a year. It’s still worth it”Paweł Poprawa, Energy Studies Institute

GRZ

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RÓBE

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Seismic acquisition poses a particular challenge: the presence of large, sometimes noisy equipment can be intimidating to local residents. Al-though the actual surface impacts of seismic are quite limited, operators in urban environments are keen to go small, and go quiet.

GT can help operators achieve this goal. Operating internationally for more than 30 years, GT has a proven track-record in a wide range of work-ing environments.

In urban settings, the application of a variety of vibrators including mini-vibes in conjunction with wireless data acquisition systems helps to minimize the footprint of seismic surveys. In general, vibrator sweep settings can be adopted to every particular restric-tion posed by the operating environ-ment so they do not leave any foot-print. Having in the fleet minivibes means that the seismic operations attract less attention from locals who may regard these machines as no more bothersome than a local delivery truck.

EXPLORE BETTEROver the last five years in Europe, GT has been a pioneer of seismic acquisi-

tion for shale gas projects. Working with operators such as ExxonMobil, Chevron and ConocoPhillips, GT has helped operators to grow their knowl-edge of the shale formation, including its structural characteristics, azi-muthal anisotropy, fracture charac-terization, stress estimation and geomechanical properties.

Along the way, GT helped to refine a dedicated software package called “Shale gas seismic data processing software” based on Earth Study 360™ as well as other proprietary software and advanced seismic interpretation. GT has a blend of expertise in its in-house interdisciplinary teams who can deliver expertise in a number of fields, not just shale exploration.

One of the challenges of seismic acquisition programs for shale forma-tions is the wealth of misinformation available on the internet. Some locals, for instance, erroneously believe that seismic acquisition will impact their drinking water. That’s why GT pro-duces informational material custom-ized for the local population, and uses permitting agents who speak the local language and can reassure citizens that their farms, fields and businesses are safe.

Operators at work in the UK face a hostile opposition, which is motivating the industry to minimize the impacts of their exploration programs.

EXPERT’S CORNER

GT’s seismic solutions for shale


FA S T FAC T S

SHALE GAS: Projects: 25

3D: 1500 sq km

2D: 5000 km

Clients: ExxonMobil, Chevron,

ConocoPhillips, Lane Energy,

BNK, PGNiG, Cuadrilla

SERVICES:• Onshore Seismic

incl. Transition Zone

• Multi-line 2D Seismic Surveys

• Large-scale

3D Seismic Campaigns

• Multicomponent (3C) Seismic

• High-Resolution

Seismic Studies

• Seismic Data Processing

and Interpretation

SCOPE:• Survey Design & Pre-Planning

• Pre-Permitting & Permitting

• GIS & Surveying

• Data Acquisition

• Quality Control & In-field

Processing

UNCONVENTIONAL KNOWLEDGEExploration for shale gas in Europe is new: there are yet no basins producing com-mercial quantities of oil and gas. That’s why it’s helpful to select a seismic ser-vices contractor who is experienced in shale.

For instance, does an operator have to use a different geophysical approach in unconventional oil and gas basins? Are there dedicated geophysical methods to explore for unconventionals? Can opera-tors use existing processing and interpre-tation tools? What geophysical methods can be applied to image the features that are crucial to plan a drilling campaign?

After years of unconventional oil and gas surveys for oil and gas explorers, GT can differentiate between conventional and unconventional approaches. We know a conventional approach will fail to meet crucial criteria and could derail an otherwise successful exploration pro-gram.

GT’s seismic crews have come across the earth’s true wonders. No matter whether it’s a national symbol - like the pristine English countryside - or a small town in Germany cherished by locals, GT keeps its impact to a minimum.

[email protected]

EXPERT’S CORNER

GT produces informational material customized for the local population, and uses permitting agents who

speak the local language.


Minivib in action


THE IMPORTANCE OF gas in the energy mix of the European Union rose from 18 percent in 1990 to 24

percent in 2012, due in part to a switch in the power generation from coal to gas. That could pass as a solid enough argument for the EU member states to get their act together and institute uni-form rules for gas, such as common purchasing of the resource by member states as a group. That is yet to happen, however.

Between 1990 and 2014, total pri-mary energy consumption in the EU rose merely one percent from 1,569 mil-lion tonnes of oil equivalent (mtoe) to 1,585 mtoe, according to Eurostat data released in 2014.

Starting in 2010, a fall in gas con-sumption across the EU (and also in Switzerland) was evident, as consump-tion tumbled from the equivalent of 522 billion cubic metres (bcm) in 2010 to just 420 bcm in 2014, according to data from Energy Aspects, a London-based consultancy.

Professor Jonathan Stern from the Oxford Institute for Energy Studies’ Natural Gas Research Programme at-tributes this fall of over 100 bcm to “relatively high gas prices compared to prices of imported coal, low CO2 prices, flat power demand and growing pene-tration of renewables” (see also p. 20).

FROM BASE TO PEAKThe progressive relocation of energy intensive industries outside of the EU, energy efficiency measures and the ex-plosion of renewables in Europe’s elec-tricity generation not only hit the eco-nomics of gas-fired power generation but marginalized gas as source of base-load power to peak-load only.

This reduced yearly operating hours as well as demand, according to the European Energy Agency’s report on primary energy consumption by fuel, published in January. Coal has been hit, but the effect on gas was larger because of gas’ smaller penetration in the EU’s energy mix.

In the same old place

E N E R G Y U N I O N

There was a hot debate about the place of natural gas in the EU’s energy union. The union’s idea is there, but with gas pretty much exactly in the same place where it used to be. Or worse.

B Y N I C H O L A S N E W M A N I N L O N D O N

CRA

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European utilities shut more coal and natural gas power plants in 2014 than in any year since at least 2009 amid fall-ing demand for electricity and tougher pollution curbs, Bloomberg New Energy Finance’s analysis showed in February.

A UNION TOO FAR?Given the EU’s zeal to cut greenhouse gases emissions, one would think the bloc’s powers would agree, be it tempo-rarily, that gas fulfills its role of bridge fuel between fossil fuels-based power generation and one based on renewables.

But the EU itself has no powers to encourage gas exploration. It only has established a common policy frame-work to ensure fair competition on the market.

The licensing rules for oil and gas are set out in the EU’s directive on prospection, exploration and produc-tion of hydrocarbons. The granting of licenses remains a national prerogative. This underlies the different national approaches and attitudes towards shale gas exploration, as evidenced by, for example, the governments of Britain and Poland that strongly support shale gas exploration.

In contrast, the governments like in France or Scotland have instituted moratoriums on fracking for the fore-seeable future. With such different approaches, the prospect of a single energy union, of which natural gas was originally thought to be one of major components, remains distant.

This has industry’s representatives lobbying even more for a bigger inclu-sion of gas in the EU’s energy land-scape. “Europe should back explora-tion and production of oil and gas, both domestically and across neigh-bouring regions if it wants a successful energy union,” said Roland Festor, EU Affairs Director at the International Association of Oil & Gas Producers.

MIXED BAG OF POLICIESSome policies that will likely further reduce demand for gas and its consump-tion in the EU are under way.

Implementing European Commission proposals to achieve a 40 percent green-house gas reduction, a 30 percent en-ergy efficiency improvement and a 27 percent renewable energy target will lead to further reductions in gas consump-tion and imports, as they will reinforce the squeeze on the gas sector.

Maroš Šefčovič, a vice-president of the European Commission in charge of energy policy said in February that the EU, despite having energy rules set at the European level, still has to deal with 28 national regulatory frameworks,

which, he added, “cannot continue”. But his quest for a uniform EU-wide stan-dard set of rules is likely to be opposed by some central European states, as well as German energy companies with long-term supply contracts with Gazprom.

ENTSO-E HO!Among few positives, work is under way

to overcome cross-border capacity issues, with the European Commission and ENTSO-E (European National Transmis-sion System Operators) backing new interconnector grid capacity and man-agement projects to overcome grid con-gestions and improve market efficiencies. This might enable gas to become more competitive with rival fuels.

There are also lobbying efforts in the European Union, to forbid national governments limiting subsidies for renewables to domestic producers only. For instance, it is not possible for a wind farm operator in Ireland to take advantage of the renewable subsidy regime in Britain in the absence of bilateral treaties.

If such market discrimination were ended, it would mean solar and wind power projects would no longer be lo-cated where the subsidies are highest but where natural conditions are best. This would further restructure the European power market, increasing the opportuni-ties for standby gas power generation. But that is in no way assured.

PO

LIC

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Recent years have seen gas marginalized from the source of base-load power to

peak-load only

EURO

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Maroš Šefčovič: national energy regulatory frameworks cannot continue

A PROMISING LANDOil and gas companies have been ac-tively exploring the contact zone be-tween the East European Craton and the west of the European Platform since the 1970s. The vast majority of the operations led in this area have so far involved conventional wells. Today the target has changed. Hydrocarbon exploration is focused on finding un-conventional reservoirs that can be economically viable. The operating company ORLEN Up-stream, a subsidiary of PKN ORLEN, the largest crude oil refining company in Poland, is exploring complex Lublin Basin assets that extend under Poland and Ukraine. The operator had drilled several vertical wells and two horizon-tal ones before taking the challenge on drilling Stoczek-OU1K horizontal well. The aim of this new project was to ex-plore the gas accumulation and produc-ing capability in the Lower Silurian and Ordovician shale deposits.

ORLEN Upstream chose TenarisHy-dril Wedge 563™ connections along with Tenaris technical and field ser-vices for this operation. As a result, the operator managed to overcome the many challenges posed by this well and reached the target depth.

CHALLENGESPAVING NEW ROADSPoland is recognized for its potential in terms of shale gas. Therefore, the country has been working to improve the avail-ability of instruments and equipment, as

well as human expertise, to develop the necessary infrastructure. Drilling wells costs three times more in Poland than in the United States, making connection performance essential.

The Stoczek-OU1K well is one of a few

B Y T E N A R I S

The Polish oil and gas company ORLEN Upstream drilled a challenging horizontal well with TenarisHydril Wedge 563™ premium connections and Tenaris technical and field services.

EXPERT’S CORNER

ORLEN Upstream and Tenaris find solutions for shale well in Poland


shale horizontal wells drilled in Poland so far. As in every exploratory well, many conditions were unknown. This situation called for special product requirements. Superior compression efficiency, torque capability and fatigue resistance were a must for the production casing string that, in order to be installed in the horizontal section, had to be pushed and rotated several times to overcome frictional forces and thus reach the target depth.

SOLUTIONSHIGH TORQUE RESISTANCE AND COMPRESSION EFFICIENCYFor the challenging Stoczek-OU1K well, ORLEN Upstream chose 5 ½” 26.80ppf Q125 with TenarisHydril Wedge 563™ for the production casing string. This technology is best-suited for applications that require extreme torque resistance. This connection offers field-proven per-formance and is easy to handle and run. In addition, the Wedge 563™ ensures 100% ratings in tension and compression.

For this operation, the TenarisHydril Wedge 563™ premium connection came with the Recess Free Bore (RFB) option to facilitate the undisturbed flow in the well during the fracturing process. To reduce the frictional forces, which occur while running the string into the lateral part of the well, the coupling with special bevel was utilized.

FULL SUPPORTORLEN Upstream together with Tenaris

technical sales and field services teams worked side-by-side to ensure the suc-cess of the operation.

Tenaris supports Poland from its es-tablished presence in Romania and Italy. In Romania, Tenaris has its commercial office in Bucharest, its seamless tubes mill in Zalau and the service center in Ploi-esti. In Italy, presence consists of seamless mills in Dalmine, Costa Volpino, Piobino and Arcore, as well as R&D facilities and two services centers.

RESULTSA CONNECTION TO RELY ONORLEN Upstream’s drilling of the Stoczek-OU1K well was a great success. The TenarisHydril Wedge 563™ con-nection facilitated a smooth operation. It presented zero re-makeups and re-jects due to product-related matters.

Final survey data of the well was taken at the depth of 4307m MD and 2953 m TVD with final inclination 91.5°, with max. recorded DLS of 8.56°/100ft. During the five days long running op-eration, mud-logging unit recorded a torque peak of almost 25,000 ft-lb, a

maximum rotational speed of 90 RPM and a maximum weight on string of 29,000 lbf. ORLEN Upstream pressure-tested Stoczek- OU1K well later on with satisfactory results.

SERVICES THAT ADD VALUEThe expertise of Tenaris technical sales team supported ORLEN Upstream in finding the best solution to overcome the challenges posed by the Stoczek-OU1K well. The field service specialist was present on the site to share knowl-edge and experience, providing useful advice whenever the customer required.

ORLEN Upstream was satisfied with the connection performance. The op-erator also acknowledged that Tenaris-Hydril Wedge 563™ connections were instrumental to reach the target depth.

Tenaris experts will use the data gathered in the field to develop a Torque, Drag & Fatigue analysis. The results will improve the understanding of the field conditions during the drilling and running phases, an information that will be useful when drilling other wells in the future.

EXPERT’S CORNER

ORLEN Upstream’s drilling of the Stoczek-OU1K well was a great success. The TenarisHydril Wedge 563™

connection facilitated a smooth operation


Operator ORLEN Upstream

Location Lublin Basin

Well Stoczek-OU1K

Services provided Field Inspection, Running Assistance

Products highlighted TenarisHydril Wedge 563™ Connections

P RO J E C T P RO F I L E


IN THE DESERT that the European shale gas sector is, anything can pass a step forward. A fresh example is

Germany, where a proposal to regulate the use of hydraulic fracturing (fracking) gained attention as seemingly paving the way toward shale gas exploration and production.

In a draft law tabled in December 2014, Germany proposed permitting fracking operations at depth of up to 3000 meters for research purposes. A six-person independent expert commis-sion would evaluate these operations and, starting in June 2018, prepare an annual report about them.

Following test operations and report-ing, it will be up to authorities to permit fracking for commercial purposes.

The publication of the draft was wel-comed by Shale Gas Europe, a lobby group based in Brussels. But lobbyists are aware that the draft comes in a po-litical context that allowed to ban frack-ing only a couple years ago.

“We’re aware that the proposal may undergo thorough changes before it’s officially tabled,” Sophia Lyscom of Shale Gas Europe told the SGIG. The group expects that the German parliament will start debating the draft by July 2015.

It’s not clear if regulations aim at mak-ing fracking safe or making the rules

too strict for companies to consider getting involved.

“The framework will be very strict so as to eliminate any impact on water, soil and climate,” Maria Krautzberger, the president of Germany’s federal environ-ment agency UBA, told the SGIG.

“It might be that these new strict rules will render shale gas exploration eco-nomically unfeasible. There are compa-nies in Germany, however, that claim they are able to meet any strict require-ments for fracking and if they can, they will be free to explore for shale gas,” Ms. Krautzberger added.

She also says that the use of fracking isn’t limited to shale gas. “We don’t want to ban the technology as such. Fracking could be used in geothermal, for ex-ample,” Ms. Krautzberger said.

DECARBONIZEDUBA says gas is unlikely to gain impor-tance in Germany’s energy mix. The country has a goal to nearly eliminate greenhouse gases emissions by 2050.

Shale Gas Europe has a different view. “Germany is seeing a significant rise in energy imports. In 2013 it imported 63% of its energy from abroad, an increase of 2% on 2012. Its energy dependency is at its highest in 20 years and 10% higher than the EU average,” the group said in

February. “[The German government] needs to find alternative sources of do-mestic production,” the group also said.

Professor Dietrich Borchardt from department of aquatic ecosystems at Helmholtz Centre for Environmental Research, still believes the discussion will turn out in favour of unconventional gas.

“The transition to renewables will [take] decades, with natural gas playing a key role. The legal frameworks under current discussion would allow for a careful development in controlled steps,” Mr. Borchardt told the SGIG.

The talk about lifting the moratorium on shale fracking in Germany is premature at best, because institutions involved in writing rules for the technology appear to be bent on not allowing its use at all.


New Rules not What They Seem

F R A C K I N G I N G E R M A N Y

Aberdeen

• Scottish oil and gas GDP (2012) GBP19bln (13% of GDP)

• Oil and gas production outlook by 2019: stable at 196,000toe/day

• Oil and gas capex: 2013-2014: £15.3bln 2018-2019 (forecast): £9.4bln

1.4tcm

421 tcm

16 mln

COUNTRY FACTS COUNTRY FACTS

0.7-2.3 tcm

15116

23% Percentage of gas in primaryenergy mix 2014

21% Percentage of gas in primaryenergy mix 2050

Gas production (toe)

Gas production (toe)

Estimate gas resources

Wells drilled Concessions awarded

SOURCE: CLEANTECH, GERMAN GOVERNMENT


Not all unconventional reservoirs are the same. Not in the ground or in your portfolio. They can boost your prospects or lower the boom. How you characterize and develop the reservoir has a huge impact on your bottom line.

The answer? Reservoir Intelligence.Reservoir Intelligence is the critical information that impacts every decision from initial investment to the last barrel you pump out of the ground. Knowing precisely what you have, and how to extract it efficiently, requires some study. But it’s science that will pay for itself many, many times over.

Contact NUTECH today.The world’s leading purveyor of Reservoir Intelligence will help you make profitable decisions across the entire lifecycle of your asset.

For free insight on the state of unconventional exploration and production, call +1-866-688-3241/+44 7966 475302 or visit us

at www.NUTECHenergy.com.

Unconventional SecretsWhat you should know before you drill, delineate, perforate or complete.

NT-UKShaleGasInvestGuide-2015-04-13.indd 1 4/13/2015 1:42:07 PM

IT USED TO be simple. Poland’s oil and gas industry was pretty much a state-run affair, with state-controlled

Polish Oil and Gas Company (PGNiG) at the helm of domestic efforts to explore, produce and sell gas.

A slew of new regulations (see table p. 49) covering concessions, royalty rates, and taxation of hydrocarbons’ E&P that is, or will soon be, in force has changed PGNiG’s position - much to the com-pany’s dislike, market sources claim.

PGNiG’s biggest grievances concern new taxation rules that impose a special hydrocarbon tax, known as SHT, and a another, new, tax based on the value of extracted resources.

“The government take is too big and on its back there come new higher roy-alty rates,” a source with knowledge of the company told the SGIG.

While SHT is paid depending on the ratio of revenue to qualified costs, the extraction tax is paid regardless of profit-ability, which works against the company, the source also said. This is backed by a PGNiG analysis that the company circu-lated among members of the parliament showed during the debate on the taxation rules late in 2014.

Earlier on, the company was spared special taxes and the royalties were smaller, as there were no other compa-nies to pay them. If the company posted a profit, the Treasury, which is

the key stakeholder at over 72 percent, was in position to press its management to pay out dividend to the state coffers. The Treasury can still do this, but extra levies are being imposed along the way, PGNiG complains.

Perhaps a company that posted a turn-over of PLN 34 billion (EUR8.5 billion) and grew its net profit 47 percent to PLN 2.8 billion (EUR698 million) in 2014, could handle new taxation rules. But, according to people with knowledge of the market, these higher taxes and royal-

ties are also threatening a number of smaller gas fields that PGNiG has been tapping for gas. “These small fields are facing the risk of becoming unprofitable with the new government take and royal-ties,” the source said.

The other new regulation that PGNiG

frowns upon is the new geology and min-ing law that regulates handling of geo-logical data and established a new regime for granting concessions.

The law ends granting of concessions free hand, making each company that wants to explore apply for a concession in tender procedure. This is a slowdown for PGNiG that has amassed considerable knowledge about the Polish geology but – in case it sets its eyes on a concession area – will have to wait for the ministry to announce a tender for it.

The new geology and mining law, PG-NiG charges, also imposes a lot more reporting of geological data to the State Geological Institute. Finally, the law now orders for any exploration project to last a maximum of five years, while it was not determined under previously binding regulations.

Perhaps the biggest issue that PGNiG has with the new regulations is that they no longer fit the context. Since 2011, when the discussion on the first changes of the law were getting under way as Poland was gripped with shale gas fever, shale gas has slipped down the company’s priorities list, which now includes more timely under-takings like positioning the company in the process of gas market liberalisation in Poland, handling of the LNG contract for the upcoming terminal in Świnoujście, plans of foreign acquisitions, and building gas-fired power plants.

The legislative package pertaining to shale gas exploration and production has been trumpeted as the necessary groundwork for shale gas E&P to get under way in Poland. The problem is, Poland’s NOC considers the package a stumbling block to its business.


Shale Fail

P O L I S H O I L & G A S C O M P A N Y

“[PGNiG’s] small gas fields are facing the

risk of becoming unprofitable with the new government take

and royalties,”Market source


Not all unconventional reservoirs are the same. Not in the ground or in your portfolio. They can boost your prospects or lower the boom. How you characterize and develop the reservoir has a huge impact on your bottom line.

The answer? Reservoir Intelligence.Reservoir Intelligence is the critical information that impacts every decision from initial investment to the last barrel you pump out of the ground. Knowing precisely what you have, and how to extract it efficiently, requires some study. But it’s science that will pay for itself many, many times over.

Contact NUTECH today.The world’s leading purveyor of Reservoir Intelligence will help you make profitable decisions across the entire lifecycle of your asset.

For free insight on the state of unconventional exploration and production, call +1-866-688-3241/+44 7966 475302 or visit us

at www.NUTECHenergy.com.

Unconventional SecretsWhat you should know before you drill, delineate, perforate or complete.

NT-UKShaleGasInvestGuide-2015-04-13.indd 1 4/13/2015 1:42:07 PM


FROM THE VAST body of mem-orable quotes generated during the early days of Polish shale euphoria,

one stands out. In 2011, shortly before the general

election that made Donald Tusk the first Polish Prime Minister to win a second term in office, Mr. Tusk said that commercial production of shale gas in Poland would happen in 2014, with revenue from it channelled to improve Poles’ pensions.

Today, with another general election coming in the fall, Mr. Tusk’s quote can serve as a point to illustrate that the complexity of getting the shale gas industry off the ground was totally lost on Polish politicians.

With macro-economic factors at play, it’s going to be even more difficult than it was in 2011 to get shale gas flowing. The oil price is falling, as is the demand for gas in Europe, both of which are likely to slow the rate of exploration.

It’s very clear that the slow tempo of exploration, poor results from the odd few wells that were fracked, and the price of oil falling globally, have taken away whatever enthusiasm there was about the Polish shale gas. However, its an election year, so politicians are not quite willing to write shale gas off the agenda just yet.

NOT A WRITE OFF?Andrzej Czerwiński, an MP of the co-ruling party Citizens’ Platform (PO) and member of the parliamentary

commission on energy and energy resources, says that under no condition will Polish shale gas disappear from the agenda. “It’s still one of the impor-tant directions of development in the Polish energy policy,” he told the SGIG.

Poland’s energy policy does mention unconventional gas as one of possible alternative scenarios, in which Poland’s energy mix is remodeled once and if “large amounts of gas from unconven-

tional sources” are found. It’s more rational, says Mr. Czerwiński, to expect that this will take longer than assumed by the Prime Minister in 2011.

“Everyone only remembers the hype of 2011 but there was no shortage of opinions back then to cool down and consider that it will take minimum three years to confirm there’s shale gas in Po-land at all. And another 10 to 15 years to move from appraisal of the resource to production on commercial scale,” Mr. Czerwiński said.

Another year and a half and a lot more will be known, Mr. Czerwiński

adds. “Exploration continues, the leg-islation is finally there. There are no shortcuts in this business,” he said.

The legislation Mr. Czerwiński refers

Poland will have elections this fall, so we asked the main parties if Poland still needs shale gas. All say yes, Poland needs to develop shale gas, although this might be convenient campaign talk, as most voters say yes as well.


Everyone Agrees on One Thing

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to is a package of laws that will be final-ized by June 2015, which entails a special law on hydrocarbon exploration and production and another law, aiming to simplify and accelerate administrative procedures. New taxation rules are also in place (see box).

WASTED TIMEAccording to Mariusz Orion Jędrysek, an MP for Law and Justice (PiS), the largest opposition party and the only party capable of winning the elections, PO has woken up to the shale oppor-tunity much too late.

“The ruling party has nothing but ruined Poland’s shale gas opportunity,” Mr. Jędrysek told the SGIG.

Mr. Jędrysek suggests that once and if PiS seizes power in Poland, the party will start from scratch and create a wholly new setting for exploration.

“I think that Poland has 1.9 trillion cubic meters (tcm) of shale gas, but the government has wasted an opportu-nity to attract foreign capital to help find it and produce it. Today, when a lot of this capital is gone, it will be very tricky to bring it back. So, first of all, Poland has to create a favourable invest-ment climate,” Mr. Jędrysek said.

The estimate that Mr. Jędrysek pro-vides is, however, hardly in line with the 2012 estimate from the Polish Geo-logical Institute. According to a former employee of PGI, who asked to remain anonymous, the unofficial figures for onshore shale gas in Poland is even smaller than what is officially commu-nicated, coming in at about 250 billion cubic meters (bcm).

NO STRATEGY, NO CREDIBILITYAccording to Jacek Najder, an MP for the small opposition party Twój Ruch, the fiasco of the Polish shale gas owes to a simple factor. “It’s not the geology, not the regulations, not the costs, but

lack of a coordinated state strategy,” Mr. Najder told the SGIG.

“Shale gas exploration companies were pretty much left to themselves, with the government hoping that they may just happen to find shale gas. That’s not how you create and shape energy policy,” Mr. Najder said.

Mr. Jędrysek charges that the govern-ment’s actions have stripped Poland of credibility of an attractive country for investment in exploration of unconven-tionals. “The investment risk is too high and manifest on too many levels, where-as in the US the only risk is geological risk,” Mr. Jędrysek said.

The ministry of environment dis-misses opposition MPs’ charges en-tirely.

“There are new companies on the market, like Stena, while others con-tinue exploration. Well results were not

the only factor behind some recent withdrawals from Poland,” Katarzyna Pliszczyńska, spokeswoman for the ministry of environment, told the SGIG.

“Chevron’s decision [to quit explora-tion in Poland] is seldom paired with the fact that the company withdrew from several European markets, not just Poland,” she added.

Ms. Pliszczyńska maintains that even if shale gas exploration confirms re-serves at the low end of the 2012 esti-mate of the PGI - some 350 bcm - it will still cover decades of demand.

“That’s why it’s still a future direction for the Polish energy sector. Whether the estimates are confirmed and wheth-er the companies will decide to start production will be determined by the effects of work to adjust the fracking technology to the Polish geology,” Ms. Pliszczyńska said.

PO

LIC

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“The ruling party has nothing but ruined Poland’s shale gas opportunity”

Mariusz Orion Jędrysek, MP, Law and Justice

2015 OIL & GAS LAWST H E N E W RU L E S

Piece of legislation

Mining and Geological Law

Special Hydrocarbon Tax Act

Draft SpecialHydrocarbon Act*

Key points

• obligatory tender for license areas

• non-EU/EFTA/NATO investors extra checked if not compromising state

security• wide scope of geological data must be submitted to

the Polish Geological Survey

• licenses cannot be freely traded

• royalty taxes due regardless of profits

from production• taxation due from

2020• three rates of SHT:

0%, 0,01-24,99%, 25% dependent on

revenue/qualified costs ratio

• priority permitting for oil & gas investments• special deadlines for

non-mining permits • strengthens operators’

position against landowners

Upsides

• joint licensing available for JOA** parties

• one license for oil & gas prospecting, exploration,

production

• exhaustive and precise catalogue of

qualified costs• different SHT rates

depending on profits

• streamlines non-mining permitting process

• gives operators legal instruments to prevent

obstruction

Downsides

• no open door procedures• JOAs heavily regulated, with separate accounting

• non-tax financial burdens

• minimum tax rates, based on benchmark

prices• high tax rates may

limit profit from minor fields

• tight permit deadlines susceptible

tobureaucratic tricks• does not solve systemic

problems

* Full name: Draft Act on the Rules of Investment in Prospecting, Exploration, Production and Transport of Hydrocarbons

** Joint Operating Agreement SOURCE: CLEANTECH


GRABBED BY HIS hand and pulled out of the conference crowd to be asked a few questions wheth-

er he’s after arguments to fuel an anti-fracking campaign in Poland, Wojciech Szymalski looks bemused.

“Why did you think I would be doing that?” asked Mr. Szymalski, PhD, who is deputy director of the Institute for Sustainable Development in Warsaw. He says he has come to the November 2014 Terrapinn’s Shale Gas World - to learn about shale gas and what it could offer Poland in terms of transition away from current staple fuel coal.

In Poland, where shale gas operators have drilled 70 wells to date and fracked a dozen, there is no immediate connection between an environmental sustainability agenda and opposition to shale gas exploration.

This is very much unlike in the UK, says Professor Paul Stevens, distinguished fellow, energy, envi-ronment and resources at London’s Chatham House.

“Poland has actually done explora-tion. Its effects are of course a differ-

ent matter, but the exploration is a fact. In the UK, the very gossip of a drilling rig on its way to a location has the opposition on red alert,” Mr. Stevens said.

“How could you possibly carry out exploration when you typically need to call the police to set up opera-tions?” Mr. Stevens asked.

COUNTRYSIDE WATCHIndeed, the UK anti-fracking opposi-tion is watching operators closely. Not only is it a widespread movement that is very well rooted in grassroots activ-ism in local communities, but it is also well organized, not least because of skillful use of social media.

A look at the UK’s opposition web-site frack-off.org.uk reveals that pro-testers have set up shop pretty much everywhere where oil and gas conces-sions are (see map). These groups are closely monitoring procedural stages that fracking companies need to go through before they receive all permits and are active parties to the process.

“We are fighting to protect Ryedale’s

beautiful countryside and way of life,” is a typical mission statement.

There are over 150 local anti-shale gas groups in England and Wales, according to information on the frack-off.org.uk, and about 20 in Scot-land, where the local government has recently imposed a ban on the tech-nology.

What environmental groups and grassroots activists say about fracking in Poland and the UK is a reflection of where both countries are on the decarbonization and environmental agenda.

B Y W O J C I E C H K O Ś Ć A N D N I L I M A C H O U D H U R Y I N L O N D O N

UK & PL: How theOpposition Differs

P E O P L E A G A I N S T F R A C K I N G

SOURCE: FRACK-OFF.ORG.UK

There is hardly any county in the UK without a local group defying shale gas.

WATCHING YOU: ANTI-SHALE GROUPS


The local England and Wales groups seek to repeat the Scotland scenario. They reject any of the pro-shale gas notions: that mass shale gas produc-tion will bring gas prices down, that fracking is safe if carried in line with environmental regulations, or that the UK needs gas to avoid power deficit in near future, underscored by mis-trust in the government and genuine concerns about industrialization of the countryside.

“The government aren’t stupid, are they? They’ll know more than us about the energy situation, and will be acting in the country’s best interest. I think we’d all like to believe that,” said Ad-ela Pickles of the Frack Free Ryedale group, somewhat sarcastically.

The group is campaigning against Third Energy’s exploration program at Kirby Misperton in North York-shire, the area over the Bowland shale, which is thought to hold 37,600 bil-lion cubic meters (bcm) of gas.

“MPs are just people, and since they’ve surrounded themselves with oil industry lobbyists it wouldn’t be surprising if they got it wrong again,” Ms. Pickles said, referring to the UK’s government blunders, like the one on the war on Iraq in 2003.

FEW AND FAR BETWEENFor contrast, Polish grassroots op-position to drilling and fracking is literally few and far between one an-other. In 2013, covering opposition to shale gas in Poland, the SGIG needed to travel to one such group, camped in remote eastern Polish area on a Chevron’s concession, where no

drilling activity was taking place, because nowhere could protesters be spotted on actual drilling sites.

On the other hand, in the northern region of Kashubia - a beautiful hilly area and renowned tourist destination - BNK Petroleum’s well pad operated

uninterrupted for weeks. So have 70 other well pads across the Poland’s shale gas exploration belt that is stretching from the Baltic Sea to near the border with Ukraine.

NO BRIDGEAbove the local activism aimed against shale gas exploration in the UK, there also is professional cam-paigning rolled out by the big fishes of environmentalism that tend to describe fracking - a relative novelty in Europe - is in fact a relic of dated approach to how humans source energy.

Organizations like Friends of the Earth UK or the UK unit of Green-peace put the need to mitigate climate change as reason number 1 to influ-ence policy makers and the general public’s attitudes to shale gas.

“I believe that the principal reason for opposition to fracking in the UK stems from the global warming mitiga-tion arguments rather than local envi-ronmental concerns – although these run a close second,” Mike Eames, for-mer fracking activist, told the SGIG. Mr. Eames now works for WWF UK, but his organisation does not campaign against shale gas at the moment.

GRE

ENS-

EFA

UK & PL: How theOpposition Differs

“In the UK, the very gossip of a drilling

rig on its way to a location has the opposition on red

alert,”Paul Stevens,

Chatham House


“We already have more fossil fuels than we can afford to burn if we want to avoid the worst impacts of climate change, so what’s the point of looking for more?” Friends of the Earth’s energy campaigner Tony Bosworth told the SGIG.

Asked about the popular notion that gas - be it from shales or conven-tional resources - could be a “bridge fuel” to fill in between getting off coal and embracing renewables, Mr. Bos-worth is skeptical.

“Gas will continue to play a role in the UK’s energy mix over the next couple of decades, but we need to get off fossil fuels fast. We don’t need shale gas to get coal out of the UK’s power generation – by the time UK shale gas comes on stream in appreciable quan-tities, coal will be virtually off the system,” Mr. Bosworth said.

IT’S A BRIDGE!With local movements virtually non-existent, Polish offices of large envi-ronmental organizations have taken on a role of awareness campaigners

- much milder ones than their UK colleagues.

This is stemming from the fact that coal in Poland is nowhere near getting “off the system”. The “bridge fuel” idea appears appealing at least to some green groups in recognition of the long - much longer than in the UK’s case - road to low carbon economy ahead of Poland.

For example, Poland’s Climate Co-alition, one of the leading voices in the debate on how Polish energy policy should respond to the chal-

Shale gas could serve as transitional technology between

coal-based energy sector and

one relying on renewable energy

Climate Coalition, Poland

WHAT DO THEY WANT?

• Fracking should be at least very strictly regulated, but best banned

• Fracking should be very strictly regulated

WHY ARE THEY AGAINST?

• Countryside protection

• Mitigation of climate change

• Localized environmental concerns

• Mitigation of climate change

• Localized environmental concerns

CAN FRACKING BE OK?

• No. It should be banned.

• It could be ok as long as strictly regulated

• It’s acceptable as interim fuel before switch to renewables

WHAT ARE THEY LIKE?

• Widespread, very active on the ground

• Keep UK shale gas industry pretty much in check

• Warsaw groups set the tone

• Have not engaged communities much

OUTLOOK

• Small overlap with industry’s view of shale gas

• Exploration to go on unless other factors interfere

• Force to be reckoned with

• To ignore protesters will ultimately backfire at theindustry

PHO

TOPI

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lenge of climate change, considers shale gas exploration an option.

Although guarded, the Climate Coalition’s position on shale gas reads that shale gas exploration “could serve as a transitional technology for the time needed to transform the coal-based energy sector to one relying on renewable energy.”

This would take making it clear in the national energy strategy that power from coal will decrease in line with growing production of gas from shales, according to the Climate Co-alition. That is, however, a remote possibility, with the government sce-narios forecasting that coal will make even 60 percent of the Polish energy mix in 2050. It is at close to 90 per-cent now.

For shale gas production to be ac-cetpable, however, the Coalition calls for a number of safety and monitor-ing measures to be introduced, such as full disclosure of information on water use, thorough monitoring of soil and water resources in well pad areas, as well as clear regulations on responsobility in case of pollution

Monitoring of methane leaks and greenhouse gases emissions as well as top-quality environmental impact assessment would also help shale gas cause in Poland, the group says. Fi-nally, composition of fracking fluid would need to be transparent.

The Polish unit of Greenpeace of-fers a similar approach: gas is accept-able as an interim fuel before the renewable revolution on condition that measures are taken to ensure fracking is safe, alongside real action to boost growth of energy from re-newable sources.

Before these measures make it to the Polish environmental regulations, shale gas is a no-go, says Katarzyna

Guzek, spokesman for Greenpeace’ Warsaw office. When asked for shale gas production’s environmental drawbacks, she offers the standard response.

“Greenpeace are not supporters of shale gas production because it defers making power generation reliant on renewables, as well as hinders prog-ress in energy efficiency,” Ms. Guzek said. “Neither does it contribute to cutting emissions of greenhouse gase,” she added.

Finally, she goes on to say, fracking uses very large amounts of water, mixed with toxic additives.

These reservations, while ground-ed - to an extent - in climate and environmental science are in fact pretty ritual, as close to five years of exploration have not yet yielded com-mercial results, offering little in terms of shale gas’ quick materialisation as an energy source for Poland.

This is perhaps why the recent re-port from Poland’s General Director-ate for Environmental Protection (GDOŚ), which concluded that drill-ing and fracking were safe, did not provoke any reaction from green groups.

HOLD’EM ACCOUNTABLEOpposition to shale gas is very dif-ferent in the UK and Poland. The UK opposition is widespread, well orga-nized on the local level, playing the card of protection of England’s heri-tage countryside landscape. Profes-sional organisations on top are giving the opposition a wider rationale re-ferring to climate change.

Poland’s is pretty much concen-trated in Warsaw, with only indi-vidual pockets of resistance on the ground. While its anti-fracking agenda also refers to climate science

a lot, it is also taking account of Po-land’s specific situation of coal-powered economy. Shale gas might be an interim option for Poland, they say, as long as the decision makers use it to narrow coal’s role in the energy mix.

Opposition in both countries is however similar in that their stance is drawing attention to the impor-tance of environmental practices of shale gas exploration. Hence extra measures that Cuadrilla Resources included in their planning applica-tion for some of their wells in Eng-land.

Hence also the GDOŚ report on seven early Polish wells, including ones that were fracked, which ob-served no long term adverse effect on air or soil quality, and only short term localised problems with noise or air pollution.

By coincidence, 2015 is a year of general election in Poland as well as in the UK. In both countries, parties differ in terms what they are plan-ning for further development of the shale gas sector (with Polish politi-cians being more hawkish).

Should shale gas effort gain mo-mentum, with more wells drilled and fracked, it will be thanks to protest groups and professional campaigners that in all likelihood no corners will be cut in terms of environmental standards.

“Certainly if we sit back and do nothing, fracking will go ahead with the minimum of safeguards and in-adequate regulation,” said Ms. Pick-les from the Ryedale group.

“In other countries where fracking has taken place, thousands of people have shown their concerns and have objected. Strong public opposition has had an impact,” she added.

OP

PO

SIT

ION

“Where fracking has taken place, thousands of people have shown their concerns and

have objected. Strong public opposition has had an impact”

Adela Pickles, Frack Free Ryedale


It took 30 years for the US wildcatters to unlock the potential

of the American shale. We’re not there yet, but five years into

development, the European market has been through some

ups and downs.

T H E E D I T O R S

5 long years on the market

P I C T O R I A L

5 long years on the market

The awareness of the shale gas industry was a mix of high expectations and poor knowledge. “Did you find gas?”

was a question Kamlesh Parmar, then country manager for Lane Energy, heard at a meeting back in 2010.

Number of wells drilled in Poland at the time: 3

SZYM

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ZEŚN

IAK

P I C T O R I A L

“Getting out there and putting yourself in front of the people who live where you want to drill”

Patrycja Kujawa, LNG Energy, 2012

Early explorers wanted to get out there and show locals what it’s all about

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SE

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SGIG: What’s the realistic date of shale gas flowing on a commercial scale?“My asessment is rather conservative, however late 2016 looks realistic”Piotr Woźniak, deputy environment minister, 2013

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P I C T O R I A L

The opposition materialized quickly. “Innumerable reports have highlighted the negative impacts of shale gas exploitation on land, water, and emissions”Jose Bove, MEP, 2012

“When I got the call, I was on my motorcycle [in Seattle],” - William Marble, chief operating officer for Silurian-Hallwood, pictured here in Warsaw, on how he got a job in Polish shale, 2012.

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SE

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The high point: 3LegsResources/ConocoPhillips flare a shale gas well in

northern Poland, although the flow rate turned out not to be commercial

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2014: enter the UK. “There is a real excitement here,” Anna McMaster of

Hutton Energy tells the SGIG in late 2014

He came, he left, he came again, he saw - John Buggenhagen of Palomar started in shale, but ended up drilling for conventional gas - with success

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Shale movers and shakers no more: Minister of the treasury Mikołaj Budzanowski and PGNiG’s CEO Grażyna Piotrowska-Oliwa,

both canned in 2013.

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Not going anywhere: protesters do a sit-in on a Chevron site in eastern Poland in 2013. Polish

shale has not moved much since

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Patrycja KujawaThen: business development

manager at LNG EnergyNow: Consultant at Nichols

Applied Management, Alberta, Canada

Kamlesh ParmarThen: CEO of 3LegsResources,

one of the pioneers of shale exploration in Poland. He

stepped down in 2015Now: “assessing new

opportunities”

Piotr WoźniakThen: deputy environment minister environment and chief geologist of Poland

Now: Administrative Board Vice-Chair, Agency for Cooperation of Energy

Regulators

Jose BoveThen and now: Member of the

European Parliament for Greens/European Free

Alliance and an anti-shale advocate

William MarbleThen: COO,

Silurian-Hallwood, then in Wisent Oil & Gas, both in

PolandNow: Chief Engineer,

Hallwood Oil & Gas, Dallas, Texas

John BuggenhagenThen: Exploration Director,

San Leon EnergyNow: CEO, Palomar Natural Resources. Still working in

Poland.

Anna McMasterThen and now:

Communications manager at Hutton Energy in the UK

Mikołaj BudzanowskiThen: minister of the treasury

of the Polish governmentNow: Chief Investment and

Development Officer, Boryszew, a chemicals

company

Grażyna Oliwa-PiotrowskaThen: CEO of PGNiG,

Poland’s national oil & gas company.

Recently: member of supervisory board of telecom

company Mediatel

Emil JabłońskiThen: leader of anti-Chevron

protest in Żurawlów, also Żurawlów’s village

administrator and farmer.Now: back to administration

and farming

Dennis McKee(not in pictorial)

Then and now: CEO of United Oilfield Services, still drilling

in Poland. Eyeing the UK market as well

Wiesław Prugar(not in pictorial)

Then and now: CEO of Orlen Upstream, one of two most important Polish shale gas operators. Planning to drill up to five new wells in 2015

Where are they now?

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IT USED TO be that OPEC would cut oil output to mess with America. Now the opposite is the case - the

cartel appears resolved to grow its out-put, with the hope of discouraging US unconventional oil and gas companies from growing theirs. The aim of the strategy is to re-open the path of the OPEC oil into the US market that has become self sufficient since shale oil and gas rose to prominence in early 2010s.

American oil imports have been steadily declining since 2005 - just when production of unconventionals was getting under way - when they hit over 5 billion barrels, to the level of 3.3 billion barrels in 2014, which is the lowest level since 1995. Perfecting the technology of extracting shale gas and oil has narrowed the US market to imported hydrocarbons, whose pro-ducers are now forced to find markets elsewhere - amongst increased com-petition of non-OPEC oil, which drives oil price even further down.

But OPEC - or Saudi Arabia at least - remains unfazed by the falling price of the commodity that built its might. The rationale behind OPEC’s resolve to keep output high is that a sustained low oil price has a potential to render some of US unconventional oil and gas industry unprofitable.

Price of West Texas Intermediate (WTI), one of key benchmarks for crude oil pricing, came in at USD44-54 in March, a fall from USD97-105 in March 2014. This is around or below breakeven price of some of the impor-tant US unconventional plays.

According to Chris Faulkner, CEO of Breitling Energy, who presented during the SGWE event in Warsaw in 2013, breakeven point in $/barrel of oil (boe) is 41-72 for Bakken and 33-68 for Eagle Ford. According to Rystad Energy, they are 53-65 for Bakken and 42-50 for Eagle Ford (WTI prices).

OPEC’s strategy appears to have some effect. In the mid April, Baker Hughes, an oilfield services company, announced that the number of work-ing oil rigs in the US decreased by 26 to 734 in mid-April, the lowest number since 2010.

That only spurred OPEC leader Saudi Arabia to turn the screw further. In March, Saudi Arabia increased its oil output by 390,000 bbl/d, with another 540,000 bbl/d added by Iraq and Libya to the already oversupplied market.

SWIFT WILDCATTERSThe US Energy Information Agency estimates that the current market situ-ation will result in 6 percent decline of

the American oil production by 2022. The growth of gas production will be maintained, although it will lose pace: from 5 percent in 2015 to 1.9 percent in 2016, according to the EIA.

US companies have also responded with economization of their assets. The wildcat nature of the US unconven-tional oil and gas business is that the smaller players, who dominate the land-scape, are more flexible and can react faster to changing situation. For them, it’s much more easier to decide about slowing the production down or post-pone drilling on less promising acreage.

As a result, in May 2015, the Ameri-can oil production is going to decline by over than 57,000 bbl/d, because of the output cuts in Bakken, Eagle Ford and Niobrara shale. Should OPEC maneuvering push the oil price back up, it is likely that the US production will pick up.

At the moment, many US companies are reported to keep their wells uncom-pleted. It is estimated that there are about 3,000 such wells in the US.

Finally, OPEC, is not Saudi Arabia alone. Not all OPEC member states approve of Saudi Arabia’s policy of keeping prices low. Iranian oil minister Bijan Zanganeh appealed to cut the output by at least 5 percent, which

GLOBAL UPDATE

Of the theories on why OPEC has not yet reacted to the plummeting oil price, there is one with a pretty good merit:

it’s a way of reining in US shale gas boom that has transformed global energy market. Will US shale industry

withstand pressure?

B Y J A N W Y P I J E W S K I

Friend or foe?O P E C V S S H A L E G A S


Saudi Arabia rejected, although the issue will be discussed during OPEC’s next meeting in early June.

An angry opinion on the current level of oil output is also coming from Libya, as well as Venezuela and Nigeria, where the breakeven price (Brent crude) is higher than in Saudi Arabia, Qatar, and Kuwait. In the case of Libya, the breakeven price is $184/bbl, while $122 for Nigeria, and $117 for Venezu-ela. Saudi Arabia breaks even at $106/bbl, while Qatar and Kuwait at $60 and $54, respectively.

Neither do those non-Middle East states have as much currency assets to withstand reduced revenue from oil sales.

THE IRAN FACTORParadoxically, the ability of the US unconventional oil and gas industry to withstand pressure by being flexible and gauge output quickly depending on the situation on the world oil mar-

ket, may be not enough because of Washington’s attempts to turn Iran into

its ally, or at least a non-hostile country. The change of the American policy

with regard to Iran could weaken Saudi Arabia’s position in its backyard the Middle East once and if Iran’s vast reserves or oil find their way back on the market, with the likely involvement of the US oil and gas companies. But that will also affect the US oil and gas industry.

Iran has the capacity to flood the market and lower the price by even $5-15/bbl in 2016, despite demand expected to rise globally.

According to OPEC, this would cause the American liquids output to decline by about 600,000 bbl/d by the fourth quarter of 2015. The US Energy Information Administration, a govern-ment body, is more optimistic, predict-ing a decline of about 210,000 bbl/d.

The Iran scenario would however be such a game-changer that the significance of the current spat be-tween the US and Saudi Arabia-led OPEC would need to be redefined completely.

The rationale behind OPEC’s resolve to keep output high is that sustained low oil price, because it has a potential to

render some of US unconventional oil

and gas industry unprofitable

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FULING, IN SOUTHWESTERN China’s Chongqing city, is fa-mous for its hot pickled mus-tard, but today it is better known

for the discovery of China’s largest shale gas field, where operator Sinopec is investing multi-billion dollars to build up production ca-pacity as part of China’s shale revo-lution.

Late last year, Chinese upstream watchdog the Ministry of Land Re-sources (MLR) confirmed that Ful-ing holds China’s largest shale gas reserves so far proven recoverable at 1.1 trillion cubic metres (tcm), but Sinopec sources said the reserve size will eventually go far beyond what is announced as the explora-tion expands more blocks at the Fuling play.

Company vice president Wang Zhigang told an audience at a recent industry gathering in Beijing that MLR’s reserve only covers 106 square kilometres, about half the size of the Fuling play.

He said that MLR stops short of making reserve assessment of the rest of Fuling acreages as limited drilling activities couldn’t provide enough data for reserve appraisal.

“The 1 trillion cubic metre reserve

is just for building build up 5 billion cubic metres (bcm) of shale gas production capacity this year,” which accounts for 77 percent of total shale gas production China is expected to produce this year, Mr. Wang said.

Fuling, listed by MLR as China’s first commercial shale gas develop-ment, is poised to produce 5 bcm

this year, a volume to be doubled to 10 bcm by 2017, according to a Sinopec development plan.

By the end of last year, Sinopec had drilled 148 wells at Fuling play, including 113 completed, and 89 being put under production. These wells are now producing 7.5 mcm

of shale gas per day. Last year, the field produced 1.1 bcm of shale gas, which is about 73 percent of the national total.

For this year, the company is slated to drill 138 wells. The current flow rate at the new wells having been completed is very robust, giv-ing Wang confidence that the pro-duction capacity at Fuling will ex-ceed 5 Bcm by the end of this year. “The rate at some wells goes as high as 500,000 cubic metres per day,” he said.

However, Wang warned that when put into commercial production, these wells won’t be running flat out in part to avoid fast depletion.

Company chairman Fu Chengyu echoed to Wang’s assumption on March 23 in Hong Kong when he said that Fuling will be only produc-ing 3.5 bcm this year.

He suggested that for a well flowing at 150,000 cubic metres per day upon test, Sinopec will cap its commercial production at about 60,000 cubic metres per day.

Fuling’s depletion indeed is a head-ache for Sinopec. The discovery well Jiaoye 1HF now only flows at about 60,000 cubic metres per day, down from 200,000 cubic metres day dur-

Alongside Argentinian and Australian peers, China’s Fuling play is one of a handful of non-US producing

shale gas plays. China’s estimated shale gas reserves are world’s largest. What’s next for the Far East giant?

B Y W U M I N G I N B E I J I N G

Fuling leads China’s shale revolution

C H I N A

“The current flow rate at some [Fuling] wells goes as high as

500,000 cubic metres per day”

Wang Zhigang, Sinopec


ing test upon discovery in 2012. However, the daily outflow at Jiaoye 6-2HF hit a record of a daily produc-tion averaging 200,000 cubic metres per day now, down from its peak of 490,000 cubic metres/day at its peak in late 2013.

With the current well head pres-sure of 20 megapascal, Jiaoye 1HF well could only last for about three more years at the current production rate, said Liu Yaowen, deputy man-ager of Sinopec Jianghan Fuling Shale Gas Company, which is Sinopec’s operating outfit for Fuling develop-ment.

To maximize the production at lowest possible cost, the company is trying to extend the horizontal reach to the wells so as to reach additional producible reserves.

Geology sources in Chongqing shrugged off the depletion issue, say-ing that the sweet spots at Fuling shale gas field are spreading over a vast area, which gives Sinopec more room to tackle depletion by drilling more wells. However, sources agreed that the shale gas wells deplete faster than the conventional gas wells.

At the backdrop of the decline of the oil prices, Sinopec is trying to

further cut the drilling cost and shorten the drilling cycle this year, but industry officials said it could be a challenging mission for Sinopec as its current drilling cost is also already considered low in China at about 70 million yuan per well. Drilling one well will normally last 70 days. Sources said that building shale gas

well pads, or commonly known as well factories, is another way to save cost.

In late March, Sinopec Jianghan Fuling Shale Gas Company com-pleted the country’s largest shale gas drilling pad. Numbered 54, the drill-ing pad comprises of five horizontal

well clusters – Jiaoye 54-1HF, Jiaoye 54-2HF, Jiaoye 54-3HF, Jiaoye 54-5HF and Jiaoye 54-6HF.

Sinopec is also adding final touch-es to a shale gas export pipeline to move Fuling gas to the market in eastern Chinese cities including Shanghai. The line which will run about 141 kilometres from Fuling via Dingshan and Renhua countries to terminate at Shizhu county, from which it will be connected with Sinopec’s existing gas pipeline that transports its gas produced at Pu-guang gas field to Shanghai.

The line with annual throughput capacity of 6 bcm will be further extended to cover Guangxi region to link the regional liquefied natural gas pipeline grid when Fuling’s second phase is completed in 2017. The 1.8 billion-yuan (USD300 million) line also incorporates two compressor stations.

Other offsite facilities for Fuling development include a shale gas gathering centre, a de-water unit with annual capacity of 4.5 cubic metres and a water supply centre with a daily capacity of 35,000 cubic metres as well as 26 ground gas trans-mission stations.

Sinopec is adding final touches to a gas

export pipeline to move Fuling gas to

the eastern Chinese cities like Shanghai

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GERMANY’S WINTERSHALL is taking its first stab at shale drilling in Argentina, the latest push to

develop Vaca Muerta, the country’s larg-est unconventional play.

In a partnership with Gas y Petroleo del Neuquen (GyP), Wintershall will drill two vertical wells into the play this year, followed by six horizontals in 2016.

If the resources prove economically viable for production, Wintershall and GyP will plow up to USD 500 million into a production pilot with 20 horizon-tal wells in 2017-18. An additional USD 2 billion will subsequently be spent on mass-scale drilling, said Gustavo Nagel, general manager of GyP, the state oil company of Neuquen, a southwestern province that holds Argentina’s greatest shale potential.

This is the latest project in a wave of investment in Argentine shale at a time when Europe’s shale industry is fizzling and China’s is fledgling.

WHY THE UPTICK? Argentina’s geology is “world class,” said Caldwell Bailey, a senior oil and gas consultant at IHS, a US-based consul-tancy. “It should not come as a shock that international oil companies are going after the kind of resource that Argentina has in the ground.”

YPF already is producing from Vaca Muerta, the first shale oil extracted outside North America. Working with US-based Chevron, their output rose to 41,200 barrels of oil equivalent per day (boe/d) in January, most of it light crude, from 38,000 boe/d in the fourth quarter.

In other partnerships, YPF is pro-ducing tight gas with US-based Dow Chemical and Argentina’s Petrolera Pampa from the Lajas play below Vaca Muerta, and plans to invest USD 550 million with Malaysia’s Petronas in Vaca Muerta’s shale oil window. Talks are underway for ventures with China’s Sinopec, France’s Total and US’ Exx-onMobil, while Royal Dutch Shell, Brazil’s Petrobras and others are work-ing on their own or in partnerships to test the plays.

The results are promising. London-based Andes Energia has found shale oil at the four wells it’s drilled. “We haven’t had any unsuccessful wells,” CEO Alejandro Jotayan said.

INCENTIVESBeyond the geology, four things are driving the investment. First, the gov-ernment of Cristina Férnandez de Kirchner has reformed policy to pro-mote exploration and production since

the 2012 state takeover of YPF from Spain’s Repsol. For the previous decade, energy prices had been kept down to fuel economic growth. That, however, led to a 20 percent drop in oil and gas production, as producers cut spending on sagging profits.

In response, the government ramped up imports to deal with widening short-ages. However, the rising imports de-pleted dollar reserves in a country al-ready short on them and with no access to international capital markets due to

There is one country with huge unconventional oil and gas reserves that not only has averted a fall in E&P investment, but where companies keep pouring dollars

to drill ever more wells. If Europe’s market is dead and China’s fledgling, Argentina’s is budding.

B Y C H A R L E S N E W B E R Y I N B U E N O S A I R E S

Argentina,a fast mule

A R G E N T I N A

COUNTRY FACTS

27 bbo Shale oil in-place

24 tcmShale gas in-place

52 bcmGas consumption

40 bcmGas production (2013)

SOURCE: EIA, ENERDATA (2013)


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government failure to fully settle a 2001 default on USD 100 billion.

To revive oil investment, the govern-ment extended licenses to 35 years from 25 for unconventional fields, and rolled out incentives. On projects of more than USD 250 million, for example, companies can now sidestep capital controls and export restrictions and duties to send abroad 20 percent of output tax-free after the third year and keep the proceeds outside the country.

The second driver is a price recovery. After a decade of getting less than USD 2.50/MMBtu for gas, producers can now sell at USD 7.50/MMBtu from new de-velopments. They also get USD 77/bbl for light crude production, even though global oil prices are running below USD 50/bbl. And if producers increase output or exports, they get a state subsidy of USD 2/bbl to USD 3/bbl on top of the mandated sales price.

The other two drivers are a need for oil and a social acceptance for fracking. “Consumption is guaranteed in Argen-tina because it needs the oil,” Nagel said, adding that thanks to the oil industry’s communications efforts there haven’t been the environmental protests that have hobbled fracking in the UK, Bul-garia, Romania and elsewhere.

CHALLENGESThere still are challenges. “We have to cut drilling costs to the USD 4-5 million per-well average in the U.S.,” Nagel said.

After reducing its costs to USD 7 mil-lion from USD 11 million in 2011, YPF is pursuing further cuts. In February, the company said it will focus on drilling more and lengthier horizontal wells. By drilling for 3,000 meters, it can do 30 to 40 fractures per lateral, up from a 2014 average of 10 fractures per 1,000-meter lateral. This will boost productivity with-out jacking up costs, as most of the outlay is on the vertical well, it said.

Logistics and infrastructure capac-ity also must be expanded. While after 107 years of crude production, Argentina has a large services indus-try, pipeline capacity and skilled la-bor, more must be done to expand pipe, road and railway capacity and domestic production of fracking chemicals, proppant and water to move the shale resources into mass production.

“Argentina doesn’t have the capac-ity to move things in and out” of well sites like the U.S. had to fuel its shale boom, Mr. Bailey said.

Political risk is another hurdle. The speed of shale development in Argen-

tina will depend on the results of the October presidential election, said Mark Jones, an expert on Latin American politics at Rice University in Houston.

While the three frontrunners are thought to be more business friendly than Férnandez, Mr. Jones said they still must implement measures more conducive for investment, such as by scraping capital controls and anti-business hostility.

“The Férnandez government has dug Argentina into a very deep hole,” Jones said. “It is going to take a lot of work and skill by the next president to get it out.”

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“We haven’t had any unsuccessful wells”

Alejandro Jotayan, CEO, Andes Energia


ALGERIA is one of Africa’s un-disputed oil and gas champions. It is the continent’s top natural

gas producer and the third largest oil producer. The country’s proximity to Europe - just over 500 kilometers across the Mediterranean Sea to the Spanish city of Barcelona - also helped Algeria become the second largest natural gas supplier to Europe.

But Algeria is also staring into the abyss of slipping down across all these important ranks.

Not even because its conventional resources have been depleted but rather that new production and in-frastructure projects have repeatedly been delayed. As a result, the coun-try’s oil production declined from a peak of nearly 2 million b/d in 2006 to 1.57 million b/d in 2013, a drop of over 20 percent, according to the BP Statistic Review of World Energy.

Although Algeria managed to buck the downward in 2014, when its oil and gas production grew by 4 percent y/y, only now is the coun-try putting on a frantic program to further increase production so as to double gas production and exports and increase oil production by 50 percent in coming decades.

These plans will require increased spending from the Algerian industry, led by the state owned oil and gas company Sonatrach. Sonatrach’s CEO, Said Sahnoun, said in January that the company would not reduce investment despite the lower oil price. Between 2015 and 2019, Algeria plans

to invest USD90 billion in its oil and gas sector, including USD64 billion in the upstream sector.

Shale gas is emerging as an impor-tant part of Algeria’s plan to reaffirm its position as one of the African and global oil and gas majors.

The effort will also be led by the national oi l and gas company Sonatrach, which completed its ini-tial shale gas pilot well in February and will continue feasibility studies

on exploiting the non-conventional resource, Mr. Souhnan announced, also in February.

“We will continue to evaluate the feasibility of exploiting this re-source,” Mr. Sahnoun told a press conference in Algiers in February, devoted mainly to the topic of shale gas development.

Sonatrach would like to see well pads to pop up in the promising Ah-

net and Illizi basins with the aim of producing up to 30 billion cubic me-ters of shale gas annually by 2020.

But it is not only the national oil and gas company that’s looking for-ward to drill for Algerian unconven-tional gas. Shell and Statoil are also involved.

Shell is operating in the Timissit area [Illizi basin] tight/shale explora-tion block, which the company was awarded in Algeria’s 4th bid round in 2014. “Shell has a non-operated position in this block and holds 19 percent equity with operatorship from Statoil (30 percent) and 51per-cent equity by the national oil com-pany Sonatrach,” Shell Algeria’s Nureddin Wefati told the SGIG.

Algeria is Africa’s second country, after South Africa, to consider shale gas. Unlike the southern nation, however,

Algeria has a lot to lose.


Champion of ambitionA L G E R I A

Between 2015 and 2019, Algeria plans to

invest $90 billion in its oil and gas sector, including $64 billion

in the upstream sector

COUNTRY FACTS

200 mlnOil and gas production in 2014 (toe)

100 mlnOil and gas export in 2014 (toe)

20.9 tcm Technically recoverable shale gasresources, 2014, at 15% recovery rate

4% Oil & Gas Production, 2014, change y/y

50% Export as %of production Spaczyński, Szczepaniak i Wspólnicy S.K.A.

Rondo ONZ 1, 12th floor00-124 Warsaw, Poland

tel.: +48 22 544 87 00fax: +48 22 544 87 01

e-mail: [email protected]

ENR Department recommendedin Legal 500 EMEA 2015

SSW Law Firm was distinguished in the Legal 500 EMEA 2015 ranking in the sector of “Energy and Natural Resources”. SSW Law Firm has been praised for its dedicated experts who form a dynamic duo by being as open and communicative as Piotr Spaczyński and as proactive as Anna Piotrowska.

ENR Department distinguishedin Chambers and Partners Europe

SSW Law Firm has been distinguished in the prestigious 2015 Chambers Europe ranking. According to Chambers the SSW team stands out for experience in mining sector and in the opinion of Clients "SSW’s natural resources team provides tailor-made, pragmatic advice.“. In 2014, SSW Team was recognised as „very commercial in its approach and its strategic recommendations".

Blog PrawoGeologiczne.pl (geological law) starts in MayExploration and mining companies in Poland face often difficulties caused by ambiguous texts of laws or situations which the laws have not regulated clearly. We are there to advise, negotiate, settle disputes, train and represent our clients. SSW lawyers have the knowledge and put it to practice every day, and now we wish to share it on our blog and invite you to open discussion in the comments section. The concept behind the blog is to elaborate laws and court rulings in a more simple and comprehensible manner, away from their heavy legal language.

The blog also informs about specific legal measures secured in the Polish Geological and Mining Law, topics related to concession-restricted businesses, as well as other issues related to environmental protection, water laws, zoning to concession-restricted businesses, as well as other issues related to environmental protection, water laws, zoning regulations and land titles.

We believe the blog shall not only raise interest of the businesses already operating on the market but also otherslooking into opportunities stemming from the exploration and mining.

We will be publishing the most interesting rulings of the Supreme Administrative Court and voivodship courts, as well as up-to-date news about regulatory works on any new laws which could be crucial for the exploration and mining sector.

On 13 – 14 January 2015 in Bristol hotel in Warsaw the Mining and Geological Law Conference took place. The event gathered nearly 100 representatives of companies operating in exploration and mining industry. Within two days several experts discussed practical aspects of amendments in the Mining and Geological Law. The lecturers included, inter alia, Daniel Kawczyński – a member of the British Parliament and a special advisor to the British Prime Minister, professor Andrzej Kraszewski Ph. D., engineer – former Minister of Environment, Henryk Jezierski Ph.D. – former Undersecretary of State and Chief National Geologist and Piotr Woźniak – former Minister of Economy and Chief National Geologist, former Undersecretary of State and Chief National Geologist and Piotr Woźniak – former Minister of Economy and Chief National Geologist, Undersecretary in Ministry of Environment.

The conference was divided into two sessions. The first day was devoted to fundamental changes which the amended Mining and Geological Law implemented, especially concession procedures, geological data submissions, operations of mining facilities. During the conference, Professor Kasztelewicz from AGH University of Science And Technology held an intriguing presentation concerning the case study of a mine construction in Poland. The presentation led to a discussion on the actual resource management policies in Poland. The need to prepare a map of strategic deposits in Poland was underlined a number times during debate. The invited experts presented practical insight for exploration and mining entities in such areas as the environment, zoning and waste management which are equally problematic for entities operating practical insight for exploration and mining entities in such areas as the environment, zoning and waste management which are equally problematic for entities operating the mining activity. The second session of the conference was dedicated to hydrocarbon exploration and production. Not only the latest regulatory changes have been presented but also other solutions which were still being planned in the hydrocarbons law.

To meet the expectations of the exploration and mining sector a follow up conference is planned in 2016 to address the first year of operations under the changed regulations. SSW Spaczyński, Szczepaniak i Wspólnicy was a co-organiser and partner of the Conference.

SSW as Co-Organiser of Mining and Geological Law Act Conference

SOURCE: EIA

WWW.CLEANTECHPOLAND.COM | 75

Spaczyński, Szczepaniak i Wspólnicy S.K.A.

Rondo ONZ 1, 12th floor00-124 Warsaw, Poland

tel.: +48 22 544 87 00fax: +48 22 544 87 01

e-mail: [email protected]

ENR Department recommendedin Legal 500 EMEA 2015

SSW Law Firm was distinguished in the Legal 500 EMEA 2015 ranking in the sector of “Energy and Natural Resources”. SSW Law Firm has been praised for its dedicated experts who form a dynamic duo by being as open and communicative as Piotr Spaczyński and as proactive as Anna Piotrowska.

ENR Department distinguishedin Chambers and Partners Europe

SSW Law Firm has been distinguished in the prestigious 2015 Chambers Europe ranking. According to Chambers the SSW team stands out for experience in mining sector and in the opinion of Clients "SSW’s natural resources team provides tailor-made, pragmatic advice.“. In 2014, SSW Team was recognised as „very commercial in its approach and its strategic recommendations".

Blog PrawoGeologiczne.pl (geological law) starts in MayExploration and mining companies in Poland face often difficulties caused by ambiguous texts of laws or situations which the laws have not regulated clearly. We are there to advise, negotiate, settle disputes, train and represent our clients. SSW lawyers have the knowledge and put it to practice every day, and now we wish to share it on our blog and invite you to open discussion in the comments section. The concept behind the blog is to elaborate laws and court rulings in a more simple and comprehensible manner, away from their heavy legal language.

The blog also informs about specific legal measures secured in the Polish Geological and Mining Law, topicsrelated to concession-restricted businesses, as well as other issues related to environmental protection, related to concession-restricted businesses, as well as other issues related to environmental protection, water laws, zoning regulations and land titles.

We believe the blog shall not only raise interest of the businesses already operating on the market but alsoothers looking into opportunities stemming from the exploration and mining.

We will be publishing the most interesting rulings of the Supreme Administrative Court and voivodship courts, as well as up-to-date news about regulatory works on any new laws which could be crucial for the exploration and mining sector.

On 13 – 14 January 2015 in Bristol hotel in Warsaw the Mining and Geological Law Conference took place. The event gathered nearly 100 representatives of companies operating in exploration and mining industry. Within two days several experts discussed practical aspects of amendments in the Mining and Geological Law. The lecturers included, inter alia, Daniel Kawczyński – a member of the British Parliament and a special advisor to the British Prime Minister, professor Andrzej Kraszewski Ph. D., engineer – former Minister of Environment, Henryk

Jezierski Ph.D. – former Undersecretary of State and Chief National Geologist and Piotr Woźniak – former Minister of Economy and Chief National Geologist, Undersecretary in Ministry of Environment.

The conference was divided into two sessions. The first day was devoted to fundamental changes which the amended Mining and Geological Law implemented, The conference was divided into two sessions. The first day was devoted to fundamental changes which the amended Mining and Geological Law implemented, especially concession procedures, geological data submissions, operations of mining facilities. During the conference, Professor Kasztelewicz from AGH University of Science And Technology held an intriguing presentation concerning the case study of a mine construction in Poland. The presentation led to a discussion on the actual resource management policies in Poland. The need to prepare a map of strategic deposits in Poland was underlined a number times during debate. The invited experts presented practical insight for exploration and mining entities in such areas as the environment, zoning and waste during debate. The invited experts presented practical insight for exploration and mining entities in such areas as the environment, zoning and waste management which are equally problematic for entities operating the mining activity. The second session of the conference was dedicated to hydrocarbon exploration and production. Not only the latest regulatory changes have been presented but also other solutions which were still being planned in the hydrocarbons law.

To meet the expectations of the exploration and mining sector a follow up conference is planned in 2016 to address the first year of operations under the changed regulations. SSW Spaczyński, Szczepaniak i Wspólnicy was a co-organiser and partner of the Conference.

SSW as Co-Organiser of Mining and Geological Law Act Conference

76 | SHALE GAS INVESTMENT GUIDE | S E A S O N 2 0X X

C O U N T R Y

WHO’S WHO

l Denmark p.78

l Germany p.78

l Poland p.79

l Slovenia p.81

l Spain p.81

l Sweden p.82

l UK p.83

COUNTRIES

The 9th issue of the Shale Gas Investment Guide brings you up to speed with what’s going on in terms of shale gas exploration in the EU-28.

The exploration continues at a slow pace. Most active markets - with the exception of Poland - are seeing a handful of wells drilled at best and very

little stimulation. Poland remains the most active market, even though the belief that it can pull off the feat of shale gas production by 2016 has

waned. Despite minor activity, it’s the UK where the European shale gas dynamics is at the time being, with 2015 slated

to be a breakthrough year for drilling.

Waitingfor a breakthrough

GUIDE



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Waitingfor a breakthrough

BILF

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D E N M A R K , G E R M A N Y

CONTACT INFO CEO - Peter Helmer Steen, Amaliegade 45, 1256 København, tel.: (+45) 72 26 57 50, email: [email protected]

BOARD MEMBERSPeter Helmer Steen, Henrik Normann, Karsten Knudsen, Berit Rynning, Brigitte Brinch MadsenChristian Herskind, Mads Andersen, Sanne Weidner

COMMENT: Drilling of the first shale exploration well in Denmark has faced difficulties: first it was hindered because of a delay in the manufacturing of the drillling rig. In early May, the work was suspended because the company report-edly used a defoamer called Nullfoam, which had not been listed in an environmental impact assessment plan ap-proved by local authorities, the Danish Energy Agency (DEA) said.

CONTACT INFO Nyhavn 43, 2, 1051 Copenhagen, Denmark, email: [email protected].

BOARD MEMBERSThierry Desmarset, Patrick Artus, Patricia Barbizet, Gunnar Brock, Patrick Pouyanné

COMMENT: Drilling of the first shale exploration well in Denmark has faced difficulties: first it was hindered because of a delay in the manufacturing of the drillling rig. In early May, the work was suspended because the company report-edly used a defoamer called Nullfoam, which had not been listed in an environmental impact assessment plan ap-proved by local authorities, the Danish Energy Agency (DEA) said.

CONTACT INFO Riethorst 12, 3069 Hannover. Postfach 51 03 60, 30633, tel.: 0511 / 6410,email: [email protected]

COMMENT: The multinational oil and gas company initiated a public relations campaign in Germany in September 2014 to convince skeptical public that its drilling practices are safe. It has funded research into shale gas safety, which is hotly debatred in Germany on the back of the so called Hanover Declaration [on “environmentall compatible” fracking]. The research is a critical component of the company’s efforts to assuage safety concerns. ExxonMobil has also promised it will use non-toxic additives to fracking fluid during hydraulic simulation of wells.

Magdeburg

HannoverMunster

KölnKassel

Erfurt

Frankfurt am Main

CONCESSIONS AREA

STAKE IN

Name Interest(%) Holder

L1/10 20% Total E&P Denmark BV

L2/10 20 Total E&P Denmark BV

CONCESSIONS HELD

Name Area (km2) Wells

L1 / 10 2,972 -

L2 / 10 2,289 -

CONCESSIONS HELD

Name Area (km2) Wells TF

Ahrensheide 429 - -

Bramsche-Erweiterung - 3 SG/TG

Delmenhorst-Elsfleth - - -

Dummersee-Uchte 845 1 SG

Hamwiede - - -

Harpstedt - - -

Herford - - -

- Cleantech/Reuters

- Cleantech/Reuters

- Cleantech

Aalborg

Skagen

Grena

Aarhus

Aarhus

Copenhagen

CONCESSIONS AREA

Zone of interestConcession area


Aalborg

Skagen

Grena

Aarhus

Aarhus

Copenhagen

CONCESSIONS AREA



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CONTACT INFO Friedrich-Ebert-Straße 160, 34119 Kassel, Germany, tel.: (+49) 561 301-0, email: [email protected]

BOARD MEMBERSRainer Seele, Martin Bachmann, Ties Tiessen, Gerhard König, Mario Mehren

COMMENT: In Germany, which has few natural resources of its own, we must examine the situation very carefully and ask ourselves which resources will be at our disposal in future. It is therefore important and right that we allow research into unconventional resources. Initially, Wintershall is also only interested in research, because the question of whether the ecologically safe and commercially viable production of shale gas is possible at all in future is – in our view – still completely open. Nonetheless, research must be allowed, because Ger-many, cannot afford to block research and expertise.

Magdeburg

HannoverMunster

KölnKassel

Erfurt

Frankfurt am Main

CONCESSIONS AREA

CONTACT INFO Troy Wagner - V.P of European Operations, ul. Wiktorska 63, 02-587, Warsaw, Polandtel.: (+48) 22 540 17 30

BOARD MEMBERSWolf Regener, Warren Nelson, Coenraad Leo, Hans Handler, David Nelson, Martin Robert

COMMENT: We believe that both Poland and Spain have significant shale gas potential. We are continuing our exploration efforts to optimize our exploration portfolio by focusing on the concessions with the best risk-reward potential. Relinquishment of the Bytow concession was a very difficult decision for us, as we firmly believe that eco-nomic production is achievable, based on our Gapowo B1A results. However, we believe the Słupsk concession, overall, has greater potential due to surface access, reser-voir parameters, well depths, and the overall size of pro-spective acreage.

RUSSIA LITHUANIA

BELARUS

SLOVAKIA

CZECHREPUBLIC

GERMANY

Łódź

Poznań

Wrocław

Rzeszów

Olsztyn

Gdańsk

Szczecin

WARSZAWA

Lublin

Bydgoszcz

Katowice Kraków

CONCESSIONS AREA

CONTACT INFO Laurie St Aubin, Country Manager, Rondo ONZ 1, 00-124 Warsaw, Polandtel.: (+48) 22 209 04 00

BOARD MEMBERSRichard Armitage, Richard Auchinleck, Charles Bunch, James Copeland, John Faraci, Jody Freeman, Gay Huey Evans, Ryan Lance, Arjun Murti, Robert Niblock, Harald Norvik, William Wade

COMMENT: PGNiG announced partnership with Cono-coPhillips to exchange geological data through its sub-sidary Lane Energy. A proposed deal between ConocoPhil-lips and PGNiG to jointly operate acreage seems to have stalled.

RUSSIA LITHUANIA

BELARUS

SLOVAKIA

CZECHREPUBLIC

GERMANY

Łódź

Poznań

Wrocław

Rzeszów

Olsztyn

Gdańsk

Szczecin

WARSZAWA

Lublin

Bydgoszcz

Katowice Kraków

CONCESSIONS AREA

CONCESSIONS HELD


Ridderade-Ost 342 -

Ruhr 2,493 -

- Stefan Leunig, Wintershall

- Troy Wagner, BNK Petroleum

CONCESSIONS HELD


Słupsk 919 1 SG

CONCESSIONS HELD


Damnica 784 1 SG

Lębork 1,062 5 SG

Karwia 209 1 SG

- Cleantech





P O L A N D

CONTACT INFO Wiesław Prugar - President, ul. Prosta 70, 00-838 Warszawa, tel.: +48 22 778 02 00, email: [email protected]

BOARD MEMBERSWiesław Prugar Paweł Martynek

COMMENT: ORLEN Upstream currently holds 8 uncon-ventional oil and gas concessions in Poland. Their total area is about 6,500 square kilometers. The company has drilled 12 shale gas wells to date and has hydraulically fractured 3 horizontal wells. These works were exploration works aim-ing at coming up with a detailed geological model of pros-petive formations on the company’s concessions.

RUSSIA LITHUANIA

BELARUS

SLOVAKIA

CZECHREPUBLIC

GERMANY

Łódź

Poznań

Wrocław

Rzeszów

Olsztyn

Gdańsk

Szczecin

WARSZAWA

Lublin

Bydgoszcz

Katowice Kraków

CONCESSIONS AREA

CONTACT INFO John Buggenhagen - CEO, Pl. Piłsudskiego 3, 00-078 Warszawa, tel.: (+48) 22 449 00 00

BOARD MEMBERSJohn Buggenhagen

COMMENT: I am excited that Palomar’s first Polish well is a success. This early success is proof that a strategy based on applying the latest seismic, drilling and completion technologies to unlock the potential of untapped conven-tional deposits in Poland, previously considered uneco-nomical can be successful.

RUSSIA LITHUANIA

BELARUS

SLOVAKIA

CZECHREPUBLIC

GERMANY

Łódź

Poznań

Wrocław

Rzeszów

Olsztyn

Gdańsk

Szczecin

WARSZAWA

Lublin

Bydgoszcz

Katowice Kraków

CONCESSIONS AREA

CONTACT INFO Piotr Gliniak - Head of Exploration, ul. Kasprzaka 25, 01-224 Warsaw,tel.: (+48) 22 691 79 67

BOARD MEMBERSMariusz Zawisza, Jarosław Bauc, Zbigniew Skrzypkiewicz, Waldemar Wójcik

COMMENT: PGNiG is working on 10 shale concessions in Po-land. To date, we have drilled 17 exploration wells, including 2 horizontal ones. In line with the company’s plan for 2015, more wells will be drilled throughout the year. Well results are subject to analysis and assessment that have helped us select prospec-tive areas. In 2015, we are going to focus on exploration in the Pomerania region [northern Poland]. Shale gas exploration has proved bigger a challenge than we expected. More exploration is needed, including drilling more horizontal wells. Experience gained from hydraulic fracturing to date will help us to more effective carrying out of the process in new horizontal wells.

RUSSIA LITHUANIA

BELARUS

SLOVAKIA

CZECHREPUBLIC

GERMANY

Łódź

Poznań

Wrocław

Rzeszów

Olsztyn

Gdańsk

Szczecin

WARSZAWA

Lublin

Bydgoszcz

Katowice Kraków

CONCESSIONS AREA

CONCESSIONS HELD


Rawicz 742 1 CONV

Góra 706 1* SG

Nowa Sól 1166 2* SG

*Drilled by San Leon Energy

CONCESSIONS HELD


Wejherowo 731 8 SG

Kartuzy-Szemud 783 1 SG

Stara Kiszewa 1,178 2 SG

Kock-Tarkawica 1,028 1 SG

Wiszniów-Tarno- 1,106 1 SG

Tomaszów Lubelski 741 1 SG

Nowogard n/a 1 TG

- Company press office

- John Buggenhagen, PNR

- Company press office

CONCESSIONS HELD


Garwolin 884 1 SG

Lubartów 1,147 3 SG

Wierzbica 652 5 SG

Sieradz 917 - SG

Wołomin 940 1 SG

Wodynie-Łuków 698 2 SGZone of interestConcession area




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CONTACT INFO Witold Weil - Country Manager, ul. Mokotowska 1, 00-640 Warsaw, Poland tel.: (+48) 608 622 883

BOARD MEMBERSOisin Fanning, Paul Sullivan, Ray King,Daniel Martin, Jeremy Boak, Piotr Rozwadowski

COMMENT: After a commercial gas dis-covery on the Rawicz concession in February, the company is focus-sing on that very con-cesssion, with 3-5 wells to be drilled to develop the field.

RUSSIA LITHUANIA

BELARUS

SLOVAKIA

CZECHREPUBLIC

GERMANY

Łódź

Poznań

Wrocław

Rzeszów

Olsztyn

Gdańsk

Szczecin

WARSZAWA

Lublin

Bydgoszcz

Katowice Kraków

CONCESSIONS AREA

CONTACT INFO Leonard Reece - CEO, 5 Charterhouse Square, London EC1M 6EE, United Kingdomtel.: (+44) 020 7251 4905

BOARD MEMBERSClive Carver, Leonard Reece, Colin Hutchinson, Nigle Moore, Cameron Davies

COMMENT: Ascent Resources announced on March 9 that it joined PrimaryBid.com fundraising platform to raise equity from private investors to further invest in its tight gas project in Slovenia.

Ljubljana

CONCESSIONS AREA



COMMENT: In Spain, we submitted environmental im-pact assessment (EIA) applications to drill and frack up to 12 wells in two concessions, Sedano and Urraca. We are currently in the public consultation process with our EIA applications, and this period will close in mid-April. We anticipate approval of these applications prior to the end of 2015. This would set us up to commence drilling opera-tions in 2016.

Barcelona

Valencia

Madrid

CONCESSIONS AREA

- Cleantech

- Cleantech

CONCESSIONS HELD


Petišovci 100 2 TG

CONCESSIONS HELD


Urraca 948 - SG

Sedano 348 - SG

- Troy Wagner, BNK Petroleum

CONCESSIONS HELD


Praszka 1,199 - SG

Czersk 702 - SG

Gdańsk W 894,41 1 SG

Braniewo S 1037 1 SG

Szczawno 603,4 1 SG

STAKE IN


Rawicz 35 PNR

Góra 35 PNR

Nowa 35 PNR





S P A I N , S W E D E N

CONTACT INFO Oisin Fanning - Chairman, 43 Grosvenor Street, Mayfair, London W1K 3HL, United Kingdomtel.: (+44) 20 3617 3913, email: [email protected]

BOARD MEMBERSOisin Fanning, Paul Sullivan, Ray King, Daniel Martin,Jeremy Boak, Piotr Rozwadowski

COMMENT: While not active in Spain bar paperwork to complete environmental impact assessment for its explora-tion program, San Leon is coming to a country with a poten-tial upside. “Central and regional governments have ap-proved about 70 oil and gas exploration permits and almost 60 more are pending decisions. [Unconventional O&G firms] hold about three-quarters of the 50 or so onshore permits in the north, where much of estimated gas - and the opposi-tion - can be found,” Bloomberg reported in 2014

Barcelona

Valencia

Madrid

CONCESSIONS AREA

CONTACT INFO Edificio Plaza Bizkaia, Alameda De Urquijo, 36-Planta 1a, E-48011 Bilbaotel.: (+34) 944035600, email: [email protected]

BOARD MEMBERSPilar Urruticoechea

COMMENT: SHESA is preparing environmental impact assessments for 3 wells targeting unconventional plays at the present moment.

Barcelona

Valencia

Madrid

CONCESSIONS AREA

CONTACT INFO CEO - Mats Budh, Skålmyrsvägen 36, 792 50 Mora, Swedentel.: (+46) 70 650 62 26

BOARD MEMBERSOla Blumenberg, Anders Wallgren, Anders Rydberg, Jonas Esteen, Karl-Ake Johansson, Tomas Wikner

COMMENT: AB Igrene is planning Vattumyren-03 Well to be drilled this summer at Mora region.

CONCESSIONS AREA

- Cleantech/Bloomberg

- Shesa

- Mats Budh, AB Igrene

CONCESSIONS HELD


AQUILES 1,664 -

CRONOS 970 -

GEMINIS 479 -

LIBRA 379 -

CONCESSIONS HELD


Angosto-1 261 -

Usapal 749.3 -

Mirua 752 -

Enara 758.5 -

Usoa 727 -

SELECTED CONCESSIONS HELD


Ryssa 38 9

Sydvastra Boda 12.5 1

Stumsnas 170 -

Hansjo 132 -

Oresjon 124 -

Oresjon 2 124 -

Norra Gullerasen 110 -





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CONTACT INFO Stephen Crabtree - CEO, Vasavägen 76, 181 41 Lidingö, Swedentel.: (+46) 72 222 6797, email: [email protected]

BOARD MEMBERSMy Simonsson, Torgny Berglund, Peter SchweizerStephen CrabtreeSven Erik Zachrisson

COMMENT: Our Northern European high quality meth-ane gas shallow project, with third party allocated contin-gent resources of 1.4 bcm, is ready for pilot production in 2015.

CONCESSIONS AREA

CONTACT INFO Francis Egan - CEO, Cuadrilla House, Stowe Court, Stowe Street, Lichfield, StaffordshireWS13 6AQ, United Kingdom, tel.: (+44) 1543 266 444

BOARD MEMBERSLord Browne Browne of Mandingley, Haroun Van Hövell tot Westerflier, N John Lancaster Jr,Ivor Orchard, Phillip Arnall, Roy Franklin, Francis Egan, Anthony Carruthers, Andrew Quarles van Ufford

COMMENT: The Environment Agency announced that it has granted Cuadrilla all of the environmental permits re-quired to carry out operations safely at its proposed shale gas exploration sites at Roseacre Wood and Preston New Road, in the North West of the UK. Cuadrilla will now await determination of planning applications [from local au-thorities - Cleantech] for both sites, which will take place later this year.

CONCESSIONS AREA

CONTACT INFO Mark Abbott - Managing Director, The Wheat House, 98 High Street, Odiham, HampshireRG29 1LP, UK, tel.: (+44) 1256 702292

BOARD MEMBERSMark Abbott, Philip Stephens, Jerry Field, Walter Roberts, Ken Ratcliff, Andrew Lodge, Neil O’Brien

CONCESSIONS HELD


Ekeby 188 16

Naset 3 2

Orlunda 9 1

Buttle 614 -

Sandon nr 1 161 -

Vallstena 94 -

Appelby 77 -- Niclas Biornstad (former CEO, stepped down April 30), Gripen Oil & Gas

- Matt Lambert, Cuadrilla Resources

CONCESSIONS HELD


PEDL 244 154 1 SG

PEDL 165 1,131 4 SG

EXL 189 45 1 SG

EXL 269 55 1 SG

CONCESSIONS AREACOMMENT: Egdon’s UK shale plans include a Gainsborough Trough shale exploration well op-erated by IGas, further farm-outs of shale explo-ration acreage in Northern England (in 2015) leading to drilling of further shale exploration wells (2016).

- James Elston, Egdon Resources

STAKE IN


PEDL 139 14.5 IGas

PEDL 140 14.5 IGas

PEDL 181 25 Europa Oil and Gas

CONCESSIONS HELD


PEDL 202 84 -

PEDL 191 66 -

PEDL 209 64 -

PEDL 43 57 -

PEDL 182 40 -

PL 161-162 18 -

PEDL 1 11 -





U N I T E D K I N G D O M

CONTACT INFO Andrew Austin, CEO, 7 Down Street, London, W1J 7AJ, United Kingdom,tel.: (+44) 207 993 9899

BOARD MEMBERSAndrew Austin, Stephen Bowler, John Blaymires, Francis Gugen, John Bryant, Robin Pinchbeck, Cuth McDowell

CONTACT INFO INEOS Upstream, Gary Haywood, CEO, Hawslease, Chapel Lane, Lyndhurst, Hampshire, SO43 7FG, tel.: (+41) 21 627 7040

BOARD MEMBERSJim Ratcliffe, Andy Currie, John Reece, Jim Dawson

CONTACT INFO David Robottom, East Knapton,Malton YO17 8JF, North Yorkshire, United Kingdomtel.: (+44) 1944 758 746, email: [email protected]

BOARD MEMBERSDavid Robottom

COMMENT: Third Energy accounced in November 2014 that it would apply for permission to hydraulically fracture existing well at Kirby Misperton to assess commercial potential of deep-er Bowland section. This structure is a hybrid formation play consisting of mainly inter-bedded sandstone snd shale. This is in contrast to the Bowland section in North West England which is shale prone.

CONCESSIONS AREACONCESSIONS HELD


AL6 - - -

DL5 - - -

PEDL177 - 1 TG/SG

PL77 - - -

PL79 - - -

PL80 - - -

PL81 - - -- Press release

CONCESSIONS AREACOMMENT: In March, IGas farmed out some of in-terest in its North West and East Midlands concessions, as well as the company’s participating interest in the PEDL 133 concession in Scotland. The deal’s value was €42mln in cash plus funding of a work program to the tune of €90mln.

- Cleantech

STAKE IN


PEDL 145 40 INEOS

PEDL 193 40 INEOS

EXL 273 15 INEOS

CONCESSIONS HELD


PEDL 184 386 1 SG

PEDL 190 386 1 CBM

PEDL 107 211 - -

PEDL 140 141 - -

PEDL 116 102 - -

PEDL 139 100 - -

PEDL 43 57 - -

CONCESSIONS AREACOMMENT: A major move and shaker on the un-conventional O&G market in the UK, INEOS farmed in to IGas’ North West and East Midlands concessions, as well as the PEDL 133 con-cession in Scotland. The deal’s value was €42mln in cash plus funding of a work program to the tune of €90mln.

- Cleantech

STAKE IN


PEDL 147 50 IGas Plc




CONCESSIONS HELD


EXL273 48 - SG

PEDL 145 102 10* CBM

PEDL 193 296 2* CBM/SG

PEDL 133 331 - SG

*Wells drilled by IGas before farmout agreement with INEOS in March 2015

www.kcadeutag.com Tel +49 5922 72 0 E-Mail [email protected] Bad Bentheim, Germany

Operating Safely, Succeeding Globally

Oil & Gas Wells

Geothermal Wells

Underground Storage Wells

Workover

Integrated Project Management

Drilling Equipment Rental




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CONTACT INFO Friedrich-Ebert-Straße 160, 34119 Kassel, Germany, tel.: (+49) 561 301-0email: [email protected]

BOARD MEMBERSRainer Seele, Martin Bachmann, Ties Tiessen, Gerhard König, Mario Mehren

COMMENT: In a country like Germany, which has few natural resources of its own, we must examine the situa-tion very carefully and ask ourselves which resources will still be at our disposal in future. It is therefore important and right that we allow research into unconventional re-sources. Initially, Wintershall is also only interested in re-search, because the question of whether the ecologically safe and commercially viable production of shale gas is possible at all in future is – in our view – still completely open. Nonetheless, research must be allowed, because

CONCESSIONS AREA



COMMENT: BNK relinquished Bytów license in March 2015. The company stated it is not leaving exploration in Poland but will focus on Słupsk concession. The company is planning to shot 2D seismic and to drill one exploration well.

CONCESSIONS AREA

CONTACT INFO Laurie St Aubin, Country Manager, Rondo ONZ 1, 00-124 Warsaw,tel. (+48) 22 209 04 00

BOARD MEMBERSRyan Lance

COMMENT: PGNiG announced partnership with Cono-coPhillips to exchange geological data through through its subsidary Lane Energy.

CONCESSIONS AREA

CONCESSIONS HELD


Ridderade-Ost 342 -

Ruhr 2,493 -

- Stefan Leunig

- Cleantech

CONCESSIONS HELD


Słupsk 919 1 SG

CONCESSIONS HELD


Damnica 784 1 SG

Lębork 1,062 5 SG

Karwia 209 1 SG

- Cleantech

www.kcadeutag.com Tel +49 5922 72 0 E-Mail [email protected] Bad Bentheim, Germany

Operating Safely, Succeeding Globally

Oil & Gas Wells

Geothermal Wells

Underground Storage Wells

Workover

Integrated Project Management

Drilling Equipment Rental

86 | SHALE GAS INVESTMENT GUIDE | S E A S O N 2 0X X

SERVICES DIRECTORY

� Depressed oil prices had E&P firms an-nounce reductions in their capital spending for 2015, which is already having a knock-on negative effect of lowered profits of oilfield service companies (OFS). Moreover, the market for services in Poland has also shrunk due to low demand. About 15 wells targeting unconventional oil and gas are expected to be drilled, down from 29 drilled in peak year 2012. In the United Kingdom, the 14th onshore li-censing round results will only be available in the second half of 2015 and could boost exploration works, but until then the market for onshore OFS will not see improvement in current demand, as only about 10 wells are planned in 2015. The March agreement of INEOS Upstream farming into IGas Bowland concessions confirms commitment of the chemical group to develop the British shale gas market - as long as regula-tions and public opposition do not interfere. Last but not least, the merger between Hal-liburton and Baker Hughes is expected to finalize in 2H of 2015 to create a new leader in the OFS sector. The market slowdown caused these companies to reduce activity and lay off staff globally.

Piotr Wdowiński (+48) 883 307 [email protected]

C O M M E N TA R Y

P I OT R W D O W I Ń S K I P R I N C I PA L A N A LY S T, C L E A N T E C H P O L A N D


Casing & Cementing BakerHughes Exalo Halliburton Schlumberger Weatherford UOSDirectional Drilling BakerHughes Drilltech Halliburton Exalo MeehanDrilling Kerui Schlumberger Weatherford UOSDrill Bits, Fluid Systems BakerHughes Exalo Halliburton MI-SWACO Sirius Pruit UOS SchlumbergerDrilling Tools and Services BakerHughes Bentec Drilltech Exalo JSHDrilling Kerui NationalOilwellVarco PruittEngineering and Modeling CCS CoreLaboratories(Saybol) Geolog ILF Wellynx NationalOilwellVarcoHard Banding Arnco HardbandingSolutionsMud Logging BakerHughes Drill-Lab Exalo Geolog GEO-data Geokrak Halliburton Schlumberger UOS WeatherfordMWD and LWD BakerHughes Halliburton Schlumberger Weatherford UOSPipe Supply Iteco JSHDrilling NationalOilwellVarco SumitomoEurope Tenaris USSteel WorkstringsRig Contracting DiscoveryDrilling Exalo KCADeutag MNDDrilling NationalOilwellVarco UOSWaste Management EkoTechEnergy MI-SWACOWell Pad Construction CDMSmith NTSConstruction

DRILLING

Casing & Cementing BakerHughes Exalo Halliburton Schlumberger Weatherford UOSChemicals Brenntag ChampionTechnologies ClearSolutionsInt.Ltd. DOW DowCorning DowMicrobial MultiChem SibelcoEuropeCoil Tubing BakerHughes Drill-tech Halliburton Exalo MeehanDrilling Schlumberger Weatherford UOSEquipment Supply BakerCorp BalancePointControl Bentec C.A.T. CAT DiscoveryDrilling Drill-Lab Drilltech GEOil&Gas ITS(Parker) JSHDrilling Kerui NationalOilwellVarco PackersPlus SuperiorEnergyServices TechPomp Tenaris UOS Weir WorkstringsPressure Pumping BakerHughes Halliburton Exalo Schlumberger Tenaris Weatherford UOSProppant Supply BalticCeramics Weir KaolinAD Sibelco(Unimin)Water Management AECom BakerCorp CDMSmith GEOil&Gas PP-EKO Veolia Tech-Pomp

COMPLETIONS

Basin Modeling Argo BakerHughes GEO-Data Geokrak Geomage Kidova Pangea SerafimConstruction of Well Pads Construction of Roads CDMSmith NTSConstructionCorporate Services PWC TrinityCorporateServices MWHGlobal PecoFacet RiskToReputationData Services Argo ION EmersonProcessManagement GEO-Data Geokrak GeofizykaKraków GeofizykaTorun Geolog Geomage Geotrace IHS Kidova PangeaDue Dilligence CleantechPolandEnvironmental Services AECom CDMSmith GSEEnvironmental Inwatec PP-EKO SalamanderGroup URS VeoliaWaterFacilities Management DBMServices EmersonProcessManagementGeological Analysis Argo BakerHughes GEO-Data Geokrak Geomage Kidova LMKR Nutech Pangea SerafimHuman Resources HAYS IPGroupLand Man CDMSmith IPGroupPermitting CDMSmith IPGroup TeslaPower generation AggrekoSeismic Services AcousticGeophysical AppliedSeismologyConsultants ION GeofizykaKraków GeofizykaTorun IPGroup ION UOSTechnical Translation Bireta

3RD PARTY SERVICES

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E U R O P E U N C O N V E N T I O N A L O I L A N D G A S

COMPANY: Acoustic Geophysical Services (Viking)SPECIALITY: Seismic servicesAREA: CEEADRESS: ul. Chłodna 11 lok. 425, 00-891 Warsaw, PolandCONTACT: tel.: (+48) 667 985 777, email: [email protected]

Acoustic Geophysical Services provides acquisition services for land seismic projects. Viking Services B.V. (Viking) announced the completion of its acquisition of Acoustic Ventures, LLC (Acoustic Geophysical Services) in late 2012. In a company statement, AGS said they will to provide seismic acquisition services in eastern and central Europe.

COMPANY: AECOMSPECIALITY: General servicesAREA: GlobalADRESS: MidCity Place 71, High Holborn, London WC1V 6QS, United KingdomCONTACT: tel.: (+44) (0)20 7645 2000

AECOM is a global provider of technical and management services to in transportation, facilities, environmental, energy and water. AECOM has 45,000 employees in 140 countries and 2013 revenue of $8.2 billion. The Poland office, located Follow AECOM on Twitter at @AECOM. The Poland office was awarded a Chevron contract in 2013.

COMPANY: AggrekoSPECIALITY: Power generation, temperature controlAREA: Global ADRESS: Aggreko Eastern Europe, Soseaua de Centura 7A, Tunari, Ilfov, 077180, Romania, CONTACT: tel.: +40 31 405 22 08, mobile: +40 752 225 985

Aggreko help companies increase profits by creating opportunities, solving problems and reducing risk using our unique network of global locations, equipment and technical services. With over 100 locations in more than 30 countries we offer 24/7 services to companies across a variety of industries.

COMPANY: Applied Seismology Consultants Ltd SPECIALITY: Seismology, MicroseismicAREA: UKADRESS: Claremont Buildings, 5 Claremont Bank, Shrewsbury, Shropshire SY1 1RJ, United KingdomCONTACT: tel.: (+44) (0)1743 271440

ASC specialises in providing microseismic monitoring of rock masses and concrete structures, particularly applied to Petroleum, Shale Gas, Geothermal Energy, Mining, Radioactive Waste storage, Carbon Dioxide storage, Civil Engineering and Laboratory Testing industries.

COMPANY: Archer Well - Allis ChalmersSPECIALITY: Integrated Oilfield ServicesAREA: GlobalADRESS: Archer, Main Road, Blackburn, Aberdeen AB21 0BP, UKCONTACT: tel.: (+44) 1224 767 500

Archer is a global oilfield service company that specializes in production drilling, unconventionals, well intervention and well integrity. Archer employs 8,300 people. The name “Allis-Chalmers” is the name of the former company, the Allis-Chalmers Manufacturing Company. In February 2011, Allis-Chalm-ers Energy merged with Seawell to form specialist drilling and well service company Archer.

COMPANY: Argo Geological ConsultantsSPECIALITY: Seismic ServicesAREA: NetherlandsADRESS: Bachlaan 46, 3706 BD Zeist, The NetherlandsCONTACT: tel.: (+31) 306 959 150, email: [email protected]

Argo Geological Consultants offer geo-scientific services to the oil and gas industry. Formed in 1987, Argo consultants perform the following services: seismic interpretation, geological and geophysical mapping, stratigraphic prediction, reservoir modeling, and E&P team support. Argo Consultants can be seconded to the client office.

COMPANY: Arnco SPECIALITY: HardbandingAREA: GlobalADRESS: Aberdeen, United KingdomCONTACT: tel.: (+44) 774 028 0302, email: [email protected]

Arnco Technology Trust, Ltd. - Arnco - does hardbanding in a history that dates to 1946 when its founder Roman F. Arnoldy developed and patented a hardfacing alloy. Arnco Technology has products to improve drill string performance and casing wear protection. Consider the product for extreme conditions in deeper, more critical, directional and horizontal extended reach wells.

COMPANY: Baker CorpSPECIALITY: Liquids and sludge storageAREA: US/Canada/EuropeADRESS: ul. Sierpów 33, 95-035 OzorkówCONTACT: tel.: (+48) 604 113 028, email: [email protected]

BakerCorp provides containment, pumping and filtration equipment and services. BakerCorp provides temporary steel storage tanks to the oilfield indus-try. The company has 100 locations in the U.S.A. and operators internationally in Europe, Canada and Mexico. Markets include chemical, manufacturing, refining, oil and gas, construction, municipal, industrial services, environmental remediation and wastewater.

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COMPANY: Baker HughesSPECIALITY: All integrated well servicesAREA: GlobalADRESS: 3rd Floor, Building 5, Chiswick Park, 566 Chiswick High Road, Chiswick London W4 5YF United KingdomCONTACT: tel.: (+44) 203 320 4900, email: [email protected]

Baker Hughes is an oilfield services company. Baker Hughes operates in 90 countries, providing drilling, formation evaluation, completion, production and reservoir consulting services. Baker Hughes has its headquarters in the America Tower in the American General Center in Houston. Baker Hughes Incorporated was formed when Baker International and Hughes Tool Company merged in 1987.

COMPANY: Balance Point Control LtdSPECIALITY: Balanced pressure and wireline servicesAREA: UK, Germany, NetherlandsADRESS: Cumberland House, Endeavour Drive, Arnhall Business Park, Westhill Aberdeenshire AB32 6UF United KingdomCONTACT: tel.: (+44) 1224 651 077, email: [email protected]

Balance Point Control (BPC) provides hydraulic work over, snubbing, well control, engineering, wireline and rental services. Equipment includes Space Saver 385K, 340K Unit, 600K Unit, HWT 600K, Pulling Units, Casing Jack and Wireline Unit. Projects include water production shut off, straddle recovery, safeguarding a blown out well and securing a chemically contaminated well.

COMPANY: Baltic CeramicsSPECIALITY: ProppantAREA: PolandADRESS: ul. Reymonta 7, 68-300 LubskoCONTACT: tel.: (+48) 22 654 66 14, email: [email protected]

Baltic Ceramics retails proppants and other products used in the extraction of hydrocarbons from unconventional oil and gas formations. Baltic Cerammics is the first proppant distributor on the Polish market, and aims to build a large production facility through both private and public funding sources.

COMPANY: BentecSPECIALITY: Rig and drill manufacturer AREA: Europe, Middle EastADRESS: Deilmannstraße 1, 48455 Bad BentheimCONTACT: tel.: (+49) 592 272 80, email: [email protected]

Bentec is a manufacturer of drilling rigs and oilfield equipment worldwide based on 125 years of history. A vertical integrated systems provider, their drilling solutions include engineering, design and manufacturing customized drilling rigs, drilling components and electrical control systems. They can provide 24/7 field support and can repair or overhaul rigs globally.

COMPANY: BiretaSPECIALITY: TranslationAREA: PolandADRESS: ul. Bronikowskiego 3/1, 02-981 WarszawaCONTACT: tel.: (+48) 22 648 55 77, email: [email protected]

Bireta provides technical translation services up to several thousand pages per month. A project management team guides translators and proofreaders in the construction, process control, electrical, mechanical, natural gas and information technology sectors. Projects include FGD Plants, wind farms, power units, CFB boilers, Combined Cycle Power Plants, CCS plants, NOx denitrification plants, and the LNG Regasification Terminal.

COMPANY: BrenntagSPECIALITY: Chemical distributionAREA: GlobalADRESS: Rawdon Park, Green Lane, Yeadon, Leeds LS19 7XX, United KingdomCONTACT: tel.: (+44) (0)113 3879200

Brenntag is a chemical distributor headquartered in Germany. Brenntag operates a global network in 70 countries employing 13,000 and generating sales of €9.7 billion in 2012. Brenntag links chemical manufacturers to users with 10,000 products and claims to be market leader in Europe.

COMPANY: C.A.T. SPECIALITY: Oilfield Equipment, Tubing, ProppantAREA: EuropeADRESS: Celle, Vorbruch 6, 29227CONTACT: tel.: (+49) 5141 9895 0, email: [email protected]

C.A.T. is a designer, manufacturer and marketer of oilfield equipment. A 20 year history, C.A.T.’s product lines include equipment for well stimulation, well workover and service, including drilling, coiled tubing, nitrogen pumping, cementing, acidizing and sand control equipment. Headquartered in Celle, Germany C.A.T. is vertically integrated: C.A.T. Construction GmbH, TACROM Service S.R.L., and TACROM Drilling S.R.L. among its sister companies.

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COMPANY: C.H. RobinsonSPECIALITY: Logistics, Supply Chain ManagementAREA: GlobalADRESS: Al. Jana Pawła II 29 Warsaw, PolandCONTACT: tel.: (+48) 22 653 65 30, email: [email protected]

C.H. Robinson is one of the world’s largest third party logistics (3PL) providers offering multimodal transportation services and logistics solutions. In Poland, C.H. Robinson works with shale gas operators and service companies to manage air and ocean freight forwarding, customs brokerage, intra-continental distribution, documentation, and regulatory requirements.

COMPANY: CaterpillarSPECIALITY: Machine ConstructionAREA: GlobalADRESS: 100 North East Adams Street, Peoria, Illinois USA 61629CONTACT: tel.: (+1) 309 675 1000, www.cat.com

Caterpillar provides equipment and services to the oil and gas industry including gas compression, land and offshore drilling, well servicing, work over rigs, mechanical drives for cranes, fire pumps, fracturing, pressure pumps, generator sets, power modules. Claims to be one of the market leaders in gas compression, drilling, and well servicing products..

COMPANY: CDM SmithSPECIALITY: Consulting, engineering, construction, permitting and operationsAREA: GlobalADRESS: Al. Jerozolimskie 123a, 02-017 Warsaw, PolandCONTACT: tel.: (+48) 22 551 93 00, email: [email protected]

CDM Smith provides services in water, environment, transportation, energy and facilities. An engineering and construction firm, CDM Smith is employee-owned with its headquarters in Cambridge, Massachusetts in the U.S.A. In Poland, the company provides environmental, construction and project management services to the oilfield and power sectors.

COMPANY: Cleantech PolandSPECIALITY: Commercial due dilligenceAREA: EuropeADRESS: ul. Krucza 51/31, 00-022, Warsaw, PolandCONTACT: tel.: (+48) 517 469 881, email: [email protected]

Cleantech Poland LLC is a consultancy for oil and gas, helping energy clients grow their business. Cleantech Poland LLC publishes EU EXPLORER, a commercial license rights and contact database, as well as the Shale Gas Investment Guide, a magazine about European unconventional oil and gas. We do commercial research for investors entering the CEE oil and gas markets, and introduce prospective parties to equity investors in their bid to raise equity and source debt.

COMPANY: Clear Solutions InternationalSPECIALITY: Drilling fluids, Pumps, chemical and minerals for drillingAREA: EuropeADRESS: Unit B3, Wem Industrial Estate, Soulton Road, Wem, Shropshire SY4 5SD, United KingdomCONTACT: tel.: (+44) (0) 1939 235 754, email: [email protected]

Clear Solutions International Limited is an independent drilling fluid specialist, employing a team of geotechnical specialists and drilling fluids engineers across Europe..

COMPANY: Core LaboratoriesSPECIALITY: Reservoir description and management, production enhancementAREA: GlobalADRESS: Herengracht 424, 1017 BZ Amsterdam, The NetherlandsCONTACT: tel.: (+48) 5586 244 641, email: [email protected]

Core Laboratories provides reservoir description, production enhancement, and reservoir management services. Core Laboratories has 70 offices in 50 countries to increase total recovery from existing fields. Core Laboratories helps clients optimize their reservoir performance and maximize hydrocarbon recovery from their production fields, billing themselves as a “reservoir optimization company.”

COMPANY: Discovery Drilling EquipmentSPECIALITY: Drilling Rigs and EquipmentAREA: GlobalADRESS: Hanover Square, 16 Hanover Square, London – W1S 1HT, United KingdomCONTACT: tel.: (+44) 207 408 9494, email: [email protected]

Discover Drilling is a private equipment and drilling rig manufacturing company in the oil and gas industry. Headquartered in London, with offices and representations in most major oil regions of the world including US, Canada, Middle East, Northern Africa, Russia and South East Asia. Discovery is a new name in the industry, after the company was formed by private investors on the basis of some rig/component building assets purchased in late 2008.

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COMPANY: DNV GLSPECIALITY: Consulting: Risk ManagementAREA: GlobalADRESS: Palace House 3 Cathedral Street SE19DE London, United KingdomCONTACT: tel.: (+44) (0)20 7357 6080

Stiftelsen Det Norske Veritas (DNV GL) is a classification society organized as a foundation, with the objective of “safeguarding life, property, and the environment”. The organization’s history goes back to 1864, when the foundation was established in Norway to inspect and evaluate the technical condition of Norwegian merchant vessels. DNV describes itself as a provider of services for managing risk.

COMPANY: DOW Microbial ControlSPECIALITY: Plastics and chemicalsAREA: GlobalADRESS: Domaniewska 50A, 02-672 Warsaw, PolandCONTACT: tel.: (+48) 228 540 320

Dow Microbial Control is a provider of biocide and antimicrobial technologies that control & prevent growth of nuisance and dangerous micro-organisms. Products stress process preservation, formulation expertise, dry film fungicides, water treatment chemistry, sanitizing and disinfecting. Their expertise includes regulatory and toxicology, and function as a division of the parent company DOW.

COMPANY: DOWSPECIALITY: Chemicals, Lubricants, Gelling agentsAREA: GlobalADRESS: Domaniewska 50A, 02-672 Warsaw, Poland CONTACT: tel.: (+48) 228 332 222, www.easterneurope.dow.com

The Dow Chemical Company, Dow, is an American multinational chemical corporation headquartered in Midland, Michigan in the USA. As of 2007, it is the second-largest chemical manufacturer in the world by revenue and as of February 2009, the third-largest chemical company in the world by market capitalization. With a presence in 160 countries, it employs about 54,000 people and spends $1 billion annually on R&D.

COMPANY: DrilltechSPECIALITY: Drilling equipment rentalAREA: GlobalADRESS: Greenwell Road, East Tullos, Aberdeen, AB12 3AX, United KingdomCONTACT: tel.: (+44) 122 424 9988, www.drill-tech.pl

Drilltech Group is a specialist drilling rental tool company whose focus is supporting complex drilling such as ERD, deepwater, horizontal and HP/HT. Drilltech supplies drill strings with high torque capabilities and Spiro-Torq, a casing wear protection and torque reduction device. Achilles certified and ISO standards on equipment.

COMPANY: DTZSPECIALITY: Real estate servicesAREA: Poland, GlobalADRESS: ul. Złota 59, 00-120 Warsaw, Poland CONTACT: tel.: (+48) 22 222 3000, email: [email protected]

DTZ is a property services company, providing occupiers and investors with end-to-end property solutions, global and local market knowledge, forecasting and trend analysis. In the oil and gas markets, DTZ can help suppliers and logistics companies find commercial space for lease, as DTZ has experts who can help real estate assets throughout the CEE.

COMPANY: DuonSPECIALITY: Energy TradingAREA: PolandADRESS: ul. Serdeczna 8, Wysogotowo k. Poznania, 62-081 Przeźmierowo, PolandCONTACT: tel.: (+48) 61 664 18 50, email: [email protected]

DUON Capital Group sells and distributes natural gas and trades in electricity. The origins of the Group activities date back to 2000. Currently DUON is one of the leading private providers of natural gas in Poland. Since 2011, it also has been building its position on the market of electricity trading.

COMPANY: EkoTech EnergySPECIALITY: Waste management, treatement, effluentsAREA: GlobalADRESS: Aleje Jerozolimskie 96, 00-807, Warsaw, PolandCONTACT: tel.: (+48) 222 755 625, email: [email protected]

EkoTech Energy is a privately company partly owned by Climate Equity Solutions. CES is an investment vehicle established in 2006 for investing in start-up companies. EkoEnergy offers technologies, products, and services aimed at the cleantech, renewable energy and waste management sectors.

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COMPANY: Emerson Process ManagementSPECIALITY: Production optimisationAREA: GlobalADRESS: Horsfield Way, Bredbury, Stockport SK6 2SU, UKCONTACT: tel.: (+44) (0) 870 240 1978

Emerson Process Management has an expertise and capabilities in all aspects of automation and information systems related to the production, transmission, and processing of oil and gas products. With industry and automation expertise, Emerson helps clients optimize their oil and gas operations and ensure the most efficient use of capital and resources.

COMPANY: EnsignSPECIALITY: Drilling, well services, production and manufacturingAREA: GlobalADRESS: H400 - 5th Avenue SW Calgary, CanadaCONTACT: tel.: (+1) 403 262 1361

Ensign Energy Services Inc. is a land-based driller and well service provider for oil, natural gas and geothermal. Since Ensign’s launch in 1987, the Canada-based company has a drilling fleet characterized by proprietary technology such as Automated Drill Rig (ADR). With headquarters in Calgary, Alberta, Ensign’s shares are listed on the Toronto Stock Exchange under the trading symbol ESI.

COMPANY: ERC EquipoiseSPECIALITY: All areas of upstream analysisAREA: UK, UAE, LibyaADRESS: 6th Floor Stephenson House, 2 Cherry Orchard Road, Croydon CR0 6BA, London, United KingdomCONTACT: tel.: (+44) (0) 20 8256 1150, email: [email protected]

ERC Equipoise is an independent Reservoir Evaluation company, specialising in all areas of upstream analysis. We offer a variety of services from independent reserve audits, to expert witness testimonials, to technical reservoir consulting including geophysical and geological modeling and reservoir simulation.

COMPANY: EurMidstreamSPECIALITY: Midstream servicesAREA: EuropeADRESS: Chaussée de la Hulpe 120, 1000 Brussels, BelgiumCONTACT: tel.: (+32) 266 317 63 [email protected]

EurMidstream is in the midstream oil and gas business from early stage production to commercial production. Services are offered during the testing and commercialization phases: testing involves CNG trucking and gas powered electricity generation. Commercialization involves design, construction and operation of facilities e.g. pipelines and associated infrastructure.

COMPANY: Exalo Drilling S.A.SPECIALITY: Integrated oilfield servicesAREA: Africa, Europe, India, Pakistan, RussiaADRESS: Pl. Staszica 9, 64-920 Piła, Poland CONTACT: tel.: (+48) 67 215 13 00, email: [email protected]

Exalo, a Polish state owned services company, was formed by the merger of five PGNiG Group companies, Exalo Drilling is the largest service company in terms of the size of its drilling and workover fleet in the Polish onshore drilling market. Exalo works predominantly in Central and Eastern Europe, but has a presence in Asia and Africa, including Kazakhstan.

COMPANY: ExproSPECIALITY: Well testing, wireline intervention, production systemsAREA: GlobalADRESS: Morton Peto Rd, Great Yarmouth, Norfolk, NR31 0LT, United KingdomCONTACT: tel.: (+44) 1493 600021, www.exprogroup.com

Expro offers well flow management. They sell products and services that measure, improve, control and process oil and gas from wells. Expro’s areas of service include exploration and appraisal, subsea safety systems, drilling/completions, flowback/clean-up, production, well integrity and intervention. 40 years, 5,000 employees, across 50 countries.

COMPANY: Fotech solutionsSPECIALITY: Hydraulic fracturing, Borehole seismic, Gas lift, Flood front monitoring, Downhole leak detectionAREA: UK, Canada, USADRESS: Titan House, Redfields Industrial Estate, Redfields Lane, Church Crookham, Hampshire, GU52 0RD CONTACT: tel.: (+44) 1252 560 570

Fotech Solutions was established in 2008 to develop Distributed Acoustic Sensing (DAS) solutions for the Oil & Gas, pipeline and security markets. A company founded with Venture Capital funding, Fotech includes Scottish Equity Partners and Energy Ventures among its primary investors, also drawing funds from the Shoabi Group.

COMPANY: GE Oil & GasSPECIALITY: Water treatment, oilfield equipmentAREA: GlobalADRESS: Ul. Emilii Plater 53, 00-113, Warsaw, PolandCONTACT: tel.: (+48) 22 520 53 53, email: [email protected]

GE Oil & Gas provides equipment and services to the oil and gas industry. Products include drilling solutions: both on and offshore, subsea, enhanced oil recovery, unconventionals, LNG, power, refinery, gas storage and pipeline. 43,000 employees in 100 customers, GE is involved in the value chain from extraction to end-use.

COMPANY: GEO-Data GmbHSPECIALITY: Wellsite services, environmental consultingAREA: EuropeADRESS: Carl-Zeiss-Str. 15, 30827 Garbsen, GermanyCONTACT: tel.: (+49) 5131 46810, email: [email protected]

Services in mudlogging, wellsite geology, laboratory services, and core analytics partner with GeoKrak Sp z o.o. as part of an expanded suite of services (surface logging, wellsite geology, cutting & gas sampling, and isotope analytics) for the Polish market. GEO-data documents and evaluates drilling data regarding geology, drilling and hydraulic peformance.


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COMPANY: Geo-Microbial Technologies (GMT)SPECIALITY: Geochemical AnalysisAREA: GlobalADRESS: 56 BoulevardSaint Michel 75006 Paris, France CONTACT: tel.: (+33) 148 103 007, email: [email protected]

GMT reduces the risk of drilling dry holes by identifying positive hydrocarbon signatures at the surface. To do this they provide interpretation services. The two techniques they retail are microbial oil survey technique (MOST), where soil samples are tested for hydrocarbons and sorbed soil gas analysis (SSG) testing for the absorption of gas in soils.

COMPANY: Geofizyka Kraków (PGNiG)SPECIALITY: Seismic services, well logging, data interpretationAREA: Poland, Austria, SlovakiaADRESS: ul. Łukasiewicza 3, 31-429 Kraków, PolandCONTACT: tel.: (+48) 122 991 200, email: [email protected]

Geofizyka Kraków is a geophysical company that performs and analyzes seismic surveys. Geofizyka Kraków is a geophysical contractor, helping clients to explore hydrocarbon and geothermal. Services include seismic data acquisition, processing, interpretation, well logging and VSP services. State owned with a 50 year history.

COMPANY: Geofizyka Toruń (PGNiG)SPECIALITY: Seismic services, well logging, data interpretationAREA: Europe, India, EgyptADRESS: ul. Chrobrego 50, 87-100 Toruń, PolandCONTACT: tel.: (+48) 566 593 101, email: [email protected]

Geofizyka Toruń provides geophysical services to the oil and gas exploration industry. The services are focused on conventional oil and gas, shale gas, geothermal deposits, and underground storage. State owned with a 50 year history, having worked in Asia, the Middle East, North Africa, Europe, and Latin America.

COMPANY: Geokrak Sp z o.o.SPECIALITY: Geological servicesAREA: CEEADRESS: ul. Mazowiecka 21, 30-019 Kraków, PolandCONTACT: tel.: (+48) 126 338 110, [email protected]

Since 1992, providing geological services associated with deep well exploration. It offers a combined suite of services (surface logging, wellsite geology, cutting & gas sampling, and isotope analytics) with their partner firm GeoData GmbH for the Polish market. Servicing the unshore unconven-tionals market as it develops in Poland.

COMPANY: GeoLogSPECIALITY: Surface LoggingAREA: GlobalADRESS: 2 Rubislaw Terrace Aberdeen AB10 1XE, Scotland, United Kingdom CONTACT: tel.: (+44) 782 156 9280, www.geologinternational.com

GEOLOG International B.V. (“GEOLOG”) is an oilfield services company that does surface logging. GEOLOG’s mud logging services are centered on the optimization of the overall drilling times and costs of each well and the acquisition of good data to improve formation evaluation. GEOLOG services national and international oil companies, both onshore and offshore, across more than 35 countries.

COMPANY: GeomageSPECIALITY: Seismic ProcessingAREA: USA, Europe, RussiaADRESS: 11011 Richmond Ave. Suite 225, Houston, Texas 77042, United StatesCONTACT: tel.: (+1) 832 7675918, www.geomage.com

Geomage is a global company that provides seismic imaging technologies and services. Using an approach involving multi-focusing, geological modeling, and reservoir characterization for a diverse range of oil and gas companies. Multifocusing may be the only method able to obtain sufficient data for geological interpretation in areas characterized by complex geology, high noise or low-fold seismic data.

COMPANY: GL Noble DentonSPECIALITY: Technical Service ProviderAREA: GlobalADRESS: Brooktorkai 18, 20457 Hamburg, Germany CONTACT: tel.: (+49) 403 614 90, email: [email protected]

GL Noble Denton is a technical service provider for the oil and gas industry. GL Noble Denton designs, builds, installs and operates oil and gas onshore, maritime and offshore assets to ensure safety, sustainability and superior value. GL Noble Denton are independent advisors providing consulting, design, assurance and project execution services.

COMPANY: Ground-gas solutions ltdSPECIALITY: Monitoring, Laboratory TestingAREA: UK, PolandADRESS: Greenheys, Manchester Science Park, Pencroft Way, Manchester, M15 6JJ, United KingdomCONTACT: tel.: (+44) 161 232 7465, email: [email protected]

GGS provides a flexible approach to risk management and environmental monitoring to provide a cost-effective service. GGS utilises continuous ground gas monitoring, and other ‘Best Available Technologies’ (BAT), to acquire robust, authoritative data that is designed to provide confidence to regulators, local communities and interested third parties that no environmental damage has occurred.

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COMPANY: GSE EnvironmentalSPECIALITY: LiningAREA: GlobalADRESS: Orchideengarten 30 09125 Chemnitz, GermanyCONTACT: tel.: (+43) 725 829 201, email: [email protected]

GSE retails environmental products such as geotextiles and membranes. Headquartered in Houston, GSE has manufacturing facilities in Texas, South Dakota and South Carolina. GSE laboratories are accredited by the Geosynthetic Accreditation Institute, and the company has manufacturing facilities in Chile, Germany, Thailand and Egypt. A history of 40 years and a global sales network.

COMPANY: HalliburtonSPECIALITY: Integrated oilfield servicesAREA: GlobalADRESS: 53 Ul. Emilii Plater 53, WFC 26th Floor, 00-113, Warsaw, Poland CONTACT: tel.: (+48) 22 4707900, email: [email protected]

Halliburton is one of the world’s largest oilfield services companies with operations in 80 countries. It owns hundreds of subsidiaries, affiliates, branches, brands, and divisions and employs over 100,000 people. Halliburton provides a range of integrated oilfield services such as pressure pumping, wireline, coiltubing and wastewater. Some technologies are proprietary, such as clean stream that uses UV light to treat wastewater.

COMPANY: Hardbanding SolutionsSPECIALITY: Hardbanding, hard facing tool jointsAREA: GlobalADRESS: Hardbanding Solutions Europe, ScotlandCONTACT: tel.: (+44) 7747 468345, email: [email protected]

Postle Industries designs alloys for mining, farming, agriculture, recycling and manufacturing. Hardbanding Solutions, a trade name, moved the company into drill pipe, drill collars and casing/risers. Tuffband and Duraband are two of their proprietary products, and tool joint build-up wires and a non-magnetic hardbanding are two of their strategies for toughening up oil pipe in extreme conditions.

COMPANY: HAYSSPECIALITY: Human ResourcesAREA: GlobalADRESS: ul. Złota 59, 00-120 Warsaw, PolandCONTACT: tel.: (+48) 22 584 5650, email: [email protected]

HAYS has operated in Poland since 2002 and provide professional services in recruitment for the executive business and industrial companies. HAYS has offices in Warsaw, Tricity (Gdynia), Katowice, Wrocław, Kraków, Lodz and Poznan. Hays Poland can find employees in Accountancy & Finance, Business Services, Construction & Property, Energy, Executive, IT, Manufacturing, Engineering and Sales/Marketing.

COMPANY: IHS SPECIALITY: Consultant ServicesAREA: GlobalADRESS: ul. Jaśkowa Dolina 15, Gdansk, PolandCONTACT: tel.: (+1) 888 906-8566, www.ihs.com

IHS is a global information company with expertise in energy, economics, geopolitical risk, sustainability and supply chain management. IHS employs more than 8,000 people in 31 countries. In oil and gas, IHS has grown over the last 50 years through a series of acquisitions, including companies such as Reservoir Visualization, Geological Consulting Services and Environmax.

COMPANY: IP GroupSPECIALITY: Seismic permiting, compensation, human resourcesAREA: PolandADRESS: ul. Elektryczna 2 00-346 Warsaw, Poland CONTACT: tel.: (+48) 604 601 050, email: [email protected]

IP Group entered the market in 2012 to provide human resources, permitting and compensation services on a government funded seismic contract. The company, under the leadership of Peter Turo, has expanded into human resources to the financial and insurance markets, alongside the energy markets. IP Group is a team of professionals with an emphasis on American style customer service.

COMPANY: ITECOSPECIALITY: Production and Drill, Supply Chain ManagementAREA: GlobalADRESS: An der Poent 62a, 40885 Ratingen, GermanyCONTACT: tel.: (+49) 2102 99 69 70

ITECO is a supplier of Oil Country Tubular Goods (OCTG) with a stronghold in the oil and gas supply industry for the past 18 years. With presence in more than 12 countries through its sales offices and stockyards. ITECO range from OCTG Products to Production and Drill Pipes to sophisticated and technical services like Supply Chain Management to Inspection and Engineering Services.

COMPANY: ITS (Parker Drilling)SPECIALITY: Oilfield equipment and servicesAREA: GlobalADRESS: Takelaarsweg 13, 1786 PR Den Helder, The Netherlands CONTACT: tel.: (+31) 88 1307 100, email: [email protected]

Parker Drilling (NYSE:PKD) provides drilling solutions to the energy industry: drilling services, rental tools and project management, including rig design, construction and operations management. Parker’s international fleet includes 25 land rigs and two barge rigs in strategic markets, and its U.S. fleet includes 13 barge rigs in the U.S. Gulf of Mexico.

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COMPANY: KAOLIN ADSPECIALITY: Sand, silica, proppantsAREA: South-East EuropeADRESS: 8, Dabrava Str., 7038 Senovo, BulgariaCONTACT: tel.: (+359) 84 612501

Silica and sand producer in Eastern-Europe, the 4th largest producer of sand in Europe. Provider of innovative solutions for ceramics and glass applications, construction materials and environmental applications.

COMPANY: KCA DEUTAGSPECIALITY: Drilling, GeneralAREA: GlobalADRESS: Deilmannstrasse 1, 48455 Bad Bentheim, GermanyCONTACT: Juergen Hesselink, Regional Commercial Manager Europe & Kazakhstan, tel.: (+49) 5922 72 608

KCA DEUTAG is an international oil and gas services company with headquarters in Aberdeen, United Kingdom. It has approximately 8,000 employees and operates in more than 20 countries. KCA DEUTAG is the merger of KCA Drilling and Deutag AG in 2001. The company has regional offices in Germany, Russia, the Middle East, the Caspian region, North and West Africa, Asia, Norway and across its wider operations. KCA Deutag has 61 land rigs and 39 offshore.

COMPANY: KeruiSPECIALITY: Oil field equipment,drilling rigs,downhole tools, pipes,natural gas compressorAREA: GlobalADRESS: ul. Domaniewska 44A, 02-672 Warsaw, Poland CONTACT: Magda Szostek, tel.: (+48) 784 772 88, email: [email protected]

Kerui Group is a Chinese company based in the region of second largest Chinese oilfield. It is a fast-developed and comprehensive international enterprise group, which combines research and design of hi-tech petroleum equipment, technical service for oilfirled integrated engineering supply of oilfield comprehensive solution and EPC turnkey projects.

COMPANY: KidovaSPECIALITY: Geological modelingAREA: North America, Europe, AustraliaADRESS: 155 avenue Roger Salengro, F-92370 Chaville, FranceCONTACT: tel.: (+33) 1 47 09 09 49, email: [email protected]

Since 1993, KIDOVA specializes in oil & gas, environment (soil, groundwater, air), geothermal and nuclear or hazardous waste disposal sectors: geostatistics, spatial and spatiotemporal data analysis and modeling, characterization and upscaling of porous and naturally fractured rock properties, simulation of single and multiphase flows in porous and fractured media, mesh or grid generation and optimization. KIDOVA’s services cover structural and geological modeling, research and development, consulting and expert studies.

COMPANY: LMKRSPECIALITY: Software Support and Consulting, Seismic ProcessingAREA: GlobalADRESS: 16th Floor, The H Dubai Office Tower, One Sheikh Zayed Road, Dubai, U.A.E. P.O. Box 62163CONTACT: tel.: (+971) 4 3727911, email: [email protected]

Founded in 1994, LMKR is a petroleum technology company with portfolio that includes reservior-centric interpretation, modeling and analytics software, mobile technology solutions, E&P data services as well as geoscience and information management consulting - all focused towards lowering the risk associated with exploration and production of conventional and unconventional resource plays.

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COMPANY: Linde Gaz PolskaSPECIALITY: Gas, EgineeringAREA: PolandADRESS: Al. Jana Pawła II 41a, 31-864 Kraków, PolandCONTACT: tel.: (+48) 12 643 92 00, www.linde.pl

Linde Gaz Polska is the local daughter of an international company specialized in the production and distribution of gas, including the delivery of integrated gas solutions, and the construction of industrial facilities. Employing some 62,000 people in around 100 countries, The Linde Group has a 100 year history and has been in Poland since 1993.

COMPANY: Lokring Technology LLCSPECIALITY: TechnologyAREA: UK, Canada, USADRESS: Little Orchard, Bardown Road Stonegate, East Sussex TN5 7EJ, United Kingdom CONTACT: tel.: (+44) 7802 871688, email: [email protected]

LOKRING Technology is dedicated to the relentless pursuit of perfection in understanding and satisfying the industry’s fluid and gas connection requirements. Using state-of-the-art computer aided technology, LOKRING designs and produces fluid and gas transfer connectors on the market today

COMPANY: Meehan DrillingSPECIALITY: DrillingAREA: UK ADRESS: 40 Kilmorey Street, Newry Co. Down, BT34 2DE, UKCONTACT: tel.: (+353) 28 3025 2678, email: [email protected]

Meehan Drilling specializes in drilling and ground engineering services to clients in the public, commercial, domestic and agricultural sectors. Established in 1972, the company offers a wide range of high quality water development, oil & gas drilling, trenchless installations and renewable energy services. With a head office in Co. Louth and a base in the UK, Meehan Drilling can get your holes drilled.

COMPANY: MI-SWACO (Schlumberger)SPECIALITY: Drilling Fluids, Completions, Waste ManagementAREA: GlobalADRESS: P.O. Box 42842 Houston, TX 77242, United StatesCONTACT: tel.: (+1) 832 628 9187, email: [email protected]

M-I SWACO offers systems and technologies for drilling, including drilling fluid systems engineered to improve drilling performance by anticipating fluids-related problems, fluid systems and specialty tools designed to optimize wellbore productivity, production technology solutions to maximize production rates, and environmental solutions that manage waste volumes generated in both drilling and production operations. M-I SWACO is owned by Schlumberger, an international oilfield services company.

COMPANY: MND Drilling & ServicesSPECIALITY: DrillingAREA: Czech Republic, Slovakia, Russia, UK, Pakstan, JemenADRESS: Velkomoravská 900/405, 696 18 Lužice, Czech RepublicCONTACT: tel.: (+420) 518 315 555, email: info-ds.mnd.cz

MND Drilling & Services is the largest drilling contractor in the Czech Republic, including oil, gas and geothermal exploration/production drilling and well workovers to the drilling and completion of underground gas storage wells. Since 1999, a member of the International Association of Drilling Contractors (IADC). Holder of the ČSN EN ISO 9001 Quality System Certificate, the ČSN EN ISO 14001 Environmental Management System Certificate and the ČSN OHSAS 18001 Health and Safety Management Certificate.

COMPANY: NADRA GroupSPECIALITY: Geological ServicesAREA: Eastern EuropeADRESS: 41-49 Agiou Nikolaou, Nimeli Court, Block C, 3rd floor 2408, Nicosia, Cyprus CONTACT: email: [email protected]

NADRA GROUP provides a range of exploration works from regional geological evaluation to the field exploration and development, support of oil and gas, metallic and non-metallic minerals and ground water production throughout the life cycle of the field. NADRA GROUP works with production companies and governments of EU,

COMPANY: National Oilwell VarcoSPECIALITY: Oilfield servicesAREA: GlobalADRESS: Badentoy Crescent, Portlethen, AB12 4YD, Aberdeen, United KingdomCONTACT: tel.: (+44) 1224 343 610, www.nov.com

National Oilwell Varco (NOV) is an American multinational corporation based in Houston, Texas. NOV is a worldwide provider of equipment and components used in oil and gas drilling and production, oilfield services, and supply chain integration services. NOV conducts operations in over 1,160 locations across six continents, and operates through three reporting segments: rig technology, petroleum services & supplies, and distribution & transmission.

COMPANY: NavigantSPECIALITY: Business AdvisoryAREA: GlobalADRESS: 5th Floor, Woolgate Exchange, 25 Basinghall Street, London, UKCONTACT: tel.: (+44) 20 7469 1111, email: [email protected]

Navigant (NYSE: NCI) is a global expert services firm. Through senior level engagement with clients, Navigant professionals combine technical expertise in disputes and investigations, economics, financial advisory and management consulting, with business pragmatism in construction, energy, financial services and healthcare industries.

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COMPANY: NTS ConstructionSPECIALITY: Well pad constructionAREA: PolandADRESS: Rynek 26, 37-500 Jarosław, PolandCONTACT: tel.: (+48) 16 623 22 51, email: [email protected]

NTS offers construction services to the oilfield. With a work history in highway construction and specializing in stabilization technologies, earthwork, roadwork, preparatory and finishing work. NTS staff has twenty years experience in implementing civil engineering construction projects.

COMPANY: NUTECHSPECIALITY: Petrophysical, geological, field study, and well servicesAREA: GlobalADRESS: 7702 FM 1960 East, Suite 300, Houston, TX 77346, United States CONTACT: Chris Hughes, tel.: (+44) 7785 261308, Stuart Large, tel.: (+44) 7966 475302, email: [email protected]

NUTECH, visionary reservoir intellience, is a privately-owned global oilfield services company founded in 1998 by oilfield profession-als who pioneered Nuclear Magnetic Resonance research and development. Headquartered in Houston, Texas with over 80 employees, NUTECH has offices in the US and internationally. NUTECH has analyzed 45,000 wells in over 80 countries.

COMPANY: Odfjell Well ServicesSPECIALITY: Drilling & Technology and Well Services business unitsAREA: Global ADRESS: Stephensonweg 18a 7741 KW Coevorden, The NetherlandsCONTACT: Alex Ott; Charles Robinson, tel.: (+31) 524 527 000

Odfjell Drilling is a listed international drilling, well service and engineering company with 3000 employees and operations in more than 20 countries.

COMPANY: Packers PlusSPECIALITY: Open hole, multi-stage completions equipmentAREA: Canada, US, Middle East, RussiaADRESS: Bow Valley Sq. 2, Suite 2200, 205 - 5th Ave. SW, Calgary, CanadaCONTACT: tel.: (+44) 791 715 4740, email: [email protected]

Packers Plus Energy Services Inc. is a privately held, Calgary-based oilfield service company that provides completion equipment and services. The company specializes in multi-stage fracturing systems for open hole, horizontal wells. Multi-stage fracturing systems are used for hydraulic fracturing, or breaking up tight rock formations to enable release of oil and gas allowing for segmentation of horizontal wells into sections or stages such that they can be fractured.

COMPANY: ParadigmSPECIALITY: Data management software, seismic processingAREA: GlobalADRESS: Dukes Court Duke Street Woking, Surrey, GU21 5BH, United KingdomCONTACT: tel.: (+44) 1483 758 000, email: [email protected]

Paradigm is the largest independent developer of software-enabled solutions to the global oil and gas industry. Paradigm easy-to-use technology and workflows provide customers with deeper insight into the subsurface by combining leading-edge science, high-performance desktop and cluster computing, and scalable data management, delivering highly accurate results and productivity without compromise.

COMPANY: PECOFacetSPECIALITY: Field services, Lab services, On-site testing, Traning classesAREA: GlobalADRESS: Treforest Industrial Estate Pontypridd, Mid Glamorgan South Wales CF37 5YL, United Kingdom CONTACT: tel.: (+44) (0) 1443 844141, email: [email protected]

With over 75 years of industry knowledge, engineering vision, ongoing research, and a network of resources, PECOFacet continually produces contaminant management solutions for an ever changing industrial landscape and an environmentally conscious world.

COMPANY: PetrofacSPECIALITY: Oilfield ServicesAREA: GlobalADRESS: 4th Floor, 117 Jermyn Street, London SW1Y 6HH, United KingdomCONTACT: tel.: (+44) 1224 650570 [email protected]

Petrofac is an oilfield service company with 30 years experience. They work across the entire spectrum of the oil and gas asset life cycle, on either a stand-alone or integrated basis, under flexible commercial models which are tailored to a customer’s needs. Our teams: design and build oil and gas infrastructure, operate, maintain and manage assets and train personnel.

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COMPANY: PwCSPECIALITY: Consulting, Business Advisory, Auditing, Tax, LegalAREA: GlobalADRESS: Al. Armii Ludowej 14, 00-638 Warsaw, PolandCONTACT: tel.: (+48) 22 523 4000, email: [email protected]

Provides oil and gas companies advisory, tax & legal, and auditing services. PwC, a global services company, has been in Poland for 20 years and there are 46 local partners. Having analyzed the proposed mining and geological law, PwC provides up to date information about the regulatory and tax environment for shale operators.

COMPANY: Rodelta Pumps InternationalSPECIALITY: Pumps AREA: GlobalADRESS: Enschedesestraat 234, 7552 CM Hengelo, The NetherlandsCONTACT: tel.: (+31) 74 2455200, email: [email protected]

Rodelta Pumps International BV is a manufacturer of pumps, located in Hengelo in the Netherlands. With 60 years developing pumps, product example includes vertically-suspended, single casing volute line-shaft driven pumps whose applications include drinking water, marine, cooling water, fire fighting and whose performance flows up to 1200 m3/h, with heads up to 120 m.l.c.

COMPANY: Salamander GroupSPECIALITY: Water, Gas Monitoring technologyAREA: UKADRESS: Booths Hall, Chelford Road, Knutsford, Cheshire WA16 8GS, United KingdomCONTACT: tel.: (+44) (0) 1565 757 817, email: [email protected]

Salamander Group identifies, funds and develops technology that meets the growing global demand for continuous asset monitoring that enables improved asset performance and risk management.

COMPANY: SchlumbergerSPECIALITY: All integrated well servicesAREA: Global ADRESS: Al. Jana Pawła II 25, 00-854 Warsaw, PolandCONTACT: tel.: (+44) 203 320 4900, email: [email protected]

Schlumberger, an international oilfield service provider, was founded in 1926 by Conrad and Marcel Schlumberger. Today Schlumberger supplies the petroleum industry with services such as seismic acquisition and processing, formation evaluation, well testing and directional drilling, well cementing and stimulation, artificial lift, well completions, flow assurance and consulting, and software and information management.

COMPANY: Scientific drillingSPECIALITY: All integrated well servicesAREA: GlobalADRESS: Wellheads Crescent, Wellheads Industrial Estate Aberdeen AB21 7GA, United Kingdom CONTACT: tel.: (+44) (0) 1224 724535, email: [email protected]

The company serves a diverse range of customers in all energy sectors. Besides participating in some of the most complex conventional and unconventional oil and gas projects in the world, SDI also has experience in working on geothermal wells and drilling horizontal laterals in coalbed methane reservoirs.

COMPANY: Sibleco EuropeSPECIALITY: Hydraulic fracturing sands producerAREA: GlobalADRESS: Brookside Hall, Congleton Road, Sandback, CW11 4TF, Cheshire, United KingdomCONTACT: tel.: (+44) 7764 959 383, email: [email protected]

Sibelco is a producer of hydraulic fracturing sands. Building on the experience and resources of our energy division in North America, we’re investing in developing new infrastructure to support the European shale gas industry.

COMPANY: SSWSPECIALITY: Legal advice to oil & gas and mining entitiesAREA: GlobalADRESS: Rondo ONZ 1, 00-124 Warsaw, Poland CONTACT: tel.: (+48) 22 544 87 00, www.ssw.pl

SSW Law Firm is providing legal advice to oil & gas and mining entities. SSW experts represent entrepreneurs in concession proceedings, environmental proceedings, investment proceedings, JV and M&A transactions. They have advised industry leaders during competitive concession proceedings before the Polish authorities, in relation to most natural resources available in Poland. SSW advises trade associations and industry members on the legislative process regarding amendment of the Geological and Mining Act and the Hydrocarbons Act.

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COMPANY: Tesla ExplorationSPECIALITY: SeismicAREA: NUK, North/South America, AfricaADRESS: Unit 2, Nix’s Hill Nix’s Hill Industrial Estate Alfreton, Derbyshire, UK DE55 7GN, United Kingdom CONTACT: tel.: (+44) 1773 838950

Tesla Exploration Ltd., provides a range of onshore and offshore geophysical and geological services to a wide and growing client base across the oil, gas, coal, mineral, water and major civil engineering industries.

COMPANY: TECH-POMP SERWISSPECIALITY: Water transfer and heating services and equipment rentalAREA: PolandADRESS: ul. Żegańska 1, 04-713 Warsaw, PolandCONTACT: tel.: (+48) 604 261 994, email: [email protected], www.watertransfer.eu

TECH-POMP SERWIS provides services for oil & gas industry. We supply complete, leak free water and other liquid transfer installations including pumps for various applications (water, drilling fluid, mud, flowback), piping and all kind of accessories. We specialize in high capacity water transfer services to support hydraulic fracturing. We analyze carefully our customers needs to ensure that each project is thoroughly planned and executed, providing best engineering and technological value available.

COMPANY: TenarisSPECIALITY: Line pipe, coiled tubing, casing, connectionsAREA: GlobalADRESS: 2200 W. Loop S., Suite 800, Houston, TX 77027, United StatesCONTACT: tel.: (+1) 713 767 4400, www.tenaris.com

Tenaris provides a full range of quality casing and tubing, drill pipe, premium connections, pipe accessories, sucker rods, and coiled tubing for use in all types of oil and gas drilling and well completion activities. Exceptional services based on expertise of material selection and pipe handling. From a manufacturing center in Romania, Tenaris can serve the Baltic, Lublin and Podlasie basins in Poland. Also a plant in Italy.

COMPANY: United Oilfield ServicesSPECIALITY: Drilling, completions, pressure pumpingAREA: PolandADRESS: Al. Jerozolemskie 123a, 02-017, Warsaw, Poland CONTACT: tel.: (+48) 22 1162 300, email: [email protected]

United Oilfield Services is an oilfield service company providing hydraulic fracturing, modern drilling, and seismic data acquisition services to the European oil and gas industry. Headquartered in Poland, UOS delivers equipment, technical expertise, and local on-site crews to provide customized solutions for customers. UOS is an equity backed startup who launched in 2011 to offer oilfield services.

COMPANY: US Steel Tubular ProductsSPECIALITY: Steel pipe supplyAREA: United States, Europe ADRESS: Vstupny areal, 044 54, Kosice, Slovak RepublicCONTACT: tel.: (+421) 55 673 9536, email: [email protected]

Tubular products for all sectors of oil and gas industry. Extensive experiences in the North American shale markets allows US Stell to provide an unparalleled level of service. US Steel manages their supply chain from a factory and back-office in Slovakia. One of North America’s largest integrated steelmakers and the continent’s largest producer of energy tubular products.

COMPANY: WeatherfordSPECIALITY: All integrated well servicesAREA: GlobalADRESS: ul. Krolewska 16, 00-103, Warsaw, PolandCONTACT: tel.: (+48) 226 451 330, email: [email protected]

Specializing in innovative formation evaluation techniques, products and services that ensure well integrity and drilling reliability, novel reservoir completion and stimulation technology that optimizes recovery, and the industry's leading portfolio of artificial lift products and production optimization capavbilities, Weatherford develops and applies its specific technology, understanding and expertise to help its customers.

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COMPANY: VallourecSPECIALITY: Pipe and tubing AREA: FranceADRESS: Ave. du Général Leclerc 27, 92100, FranceCONTACT: tel.: (+33) 1 49 09 35 00, email: [email protected]

Vallourec is a manufacturer and retailer of tubular solutions serving the energy markets (oil and gas, power generation). With 22,200 employees and sales of 5.3 billion euros in 2012 – including 78% from outside Europe – Vallourec has integrated manufacturing facilities integrated in more than 20 countries. Vallourec has five research and development facilities worldwide.

COMPANY: Weir Oil & Gas DivisionSPECIALITY: Pumping, proppant, water and flowlinesAREA: GlobalADRESS: Al. 3 Maja 9, 30-062 Krakow CONTACT: tel.: (+48) 126 328 469, email: [email protected]

Weir Oil & Gas delivers services for customers from capital projects to long term asset management contracts for continuing operations both onshore and offshore. Services range from exploration and production through transportation, refining and storage. Weir has a portfolio of high performance pumps and safety critical equipment.

COMPANY: WellynxSPECIALITY: Engineering and Consultancy servicesAREA: EuropeADRESS: Viale G. D’Annunzio, 267 65127 Pescara, ItalyCONTACT: email: [email protected]

Wellynx is an independent Italian company providing engineering and consultancy services to O&G Companies. Founded in 2011, Wellynx is composed by professionals with sound oilfield experience in various fields such as design and engineering, operations and maintenance, quality, health, safety & environment.

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Gas Shows

FIRST WELLS ARE WINNERS

GUIDE/POLANDSHALE GAS

investment

WHO’S WHO IN CONCESSIONS

PIPELINE NETWORK | HYDRAULIC FRACTURING | GEOLOGY OF THE BALTIC BASIN | NATURA 2000

Pioneers of the

OLD WORLD

Water Sourcing

HUGE SCARCITY OF SUPPLY

Got Innovation?

TOP 10 OPPORTUNITIES

IN SERVICES

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SUMMER 2011

USA $18 - $18CAD - POLAND 50 PLN + VAT - EU €12 - UK £11

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SERVICESCOMPANY DIRECTORY

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WOZNIAK THE CHIEF GEOLOGIST

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CLEANTECHPAVILION TOP 25

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SUMMER 2013

GLOBAL UPDATE | TAXES AND ROYALTIES | WHO’S WHO IN CONCESSIONS | WELL PADSUSA $32 | $30CAD | POLAND 100 PLN + VAT | EU €25 | UK £20

GUIDE


courage

GRAZYNA SACKED

COVER_final.indd 1

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Distribution in United Kingdom

Contactustoboostyoursales:

-Advertising,commercialpartnerships-Sponsoredandexpandeddirectorylistings-CommercialdataonEU-28oilandgas

Parker Snyder (+48) 517 469 881 [email protected]

GUIDE


TECH-POMP SERWIS offers highly

maintained, state of the art pumps

and accessories bringing over 20

years’ experience of TECH-POMP in

distribution and production of pump

units for the European market.

Water transfer. Services. Rental

W A T E R T R A N S F E R S E R V I C E S R E N T A L 2 4 H / 3 6 5 D A Y S G L O B A L

ul. Żegańska 1, 04-713 Warsaw, Poland

tel.: + 48 22 612 98 24 – 26, e-mail: [email protected]

watertransfer.eu

TECH-POMP SERWIS is a leader in water transfer services providing best

quality engineering available, equipment and complete solutions tailored

to the client’s individual needs. We provide high capacity fluid transfer

services, utilizing a variety of piping types and sizes for environmentally

friendly temporary fluid transfer systems. Our team of highly qualified

engineers and technicians provides consulting and designing services,

together with performing and completing the most demanding projects

efficiently and on time.

We do not simply meet our client expectations - we exceed it.


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TECH-POMP SERWIS offers highly

maintained, state of the art pumps

and accessories bringing over 20

years’ experience of TECH-POMP in

distribution and production of pump

units for the European market.

Water transfer. Services. Rental

W A T E R T R A N S F E R S E R V I C E S R E N T A L 2 4 H / 3 6 5 D A Y S G L O B A L

ul. Żegańska 1, 04-713 Warsaw, Poland

tel.: + 48 22 612 98 24 – 26, e-mail: [email protected]

watertransfer.eu

TECH-POMP SERWIS is a leader in water transfer services providing best

quality engineering available, equipment and complete solutions tailored

to the client’s individual needs. We provide high capacity fluid transfer

services, utilizing a variety of piping types and sizes for environmentally

friendly temporary fluid transfer systems. Our team of highly qualified

engineers and technicians provides consulting and designing services,

together with performing and completing the most demanding projects

efficiently and on time.

We do not simply meet our client expectations - we exceed it.


PSC maintains a presence on major industry events to facilitate communication within the industry and build social acceptance for private oil and gas investment.


Helping investors

IN LATE NOVEMBER, Poland Shale Coalition exhibited at the Shale Gas World Europe 2014 conference

in Warsaw, which welcomed over 500 attendees ranging from shale gas opera-tors, local and national authorities to license holders, investors, and solution providers.

As was the case in previous year, PSC exhibited in the PSC Pavilion – a 10-meter by 10 exhibition space where clients could network and showcase. Guests could meet PSC members and representatives and discuss business matters over a cup of coffee, provided by the Pavilion’s bar.

At the end of the first day of the con-ference, PSC’s signature whisky tasting event took place. This time, we invited Frank Thompson, unconventional resources business development man-ager at oilfield services company Sch-lumberger and whisky connoisseur, to lead it.

PSC at Shale Gas World Europe 2014



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PSC Executive Lunch

At a Terrapinn round table discussion


PSC strives to give private oil & gas investors a place to meet. That’s why we gather key representatives for our monthly executive lunch meetings.


Communicationplatform

Parker Snyder, PSC President of the Board, was invited by the Gas Exporting Countries Forum (GECF) to take part in its lecture series. On January 18th, Mr. Snyder presented to 80 senior diplomats and company managers in Qatar on the current state of shale gas development in Poland and Europe in general

THE MONTHLY PSC executive lunch meetings are an opportunity to stay in touch with the latest develop-

ments in the shale gas industry and discuss them with leading industry representa-tives.

The January meeting offered a unique chance for Poland’s shale industry to voice a collective message that could be taken to the January Gas Exporting Countries Forums (GECF) guest lecture series in Qatar.

The belief in viability of Polish hydro-carbon development was bolstered by the fact many of the newcomers to the market, such as Palomar Natural Resources or Discovery Geo, have past experience with hydrocarbon exploration in Poland.


Guests at the meeting included Monika Szostek, Piotr Nowak, Marek Madeja and Jerzy Woźniak

Guests discuss the latest developments in shale gas industry

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Agata Hinc, Shell Oliver Nuffer, KCA Deutag

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Ron Crow, Discovery Geo


NUTECHis a U.S. based global oilfield

consultancy providing reservoir optimization and evaluation

services including optimization of existing wells.

www.nutechenergy.com

SAN LEON ENERGYAn independent oil and gas

exploration company and Europe’s leading shale gas company by acreage. The company has a portfolio of assets located in Poland, Morocco, Albania,

Ireland, Spain and Italy.

www.sanleonenergy.com

NTSNTS offers construction services to the oilfield. With a work history in highway construction and specializing in stabili-

zation technologies, earthwork, roadwork, preparatory and finishing

work. NTS staff has twenty years experience in implementing civil

engineering construction projects.

www.stabilizacje.net

KERUIChinese company based in the region of

second largest Chinese oilfield. It is a fast-developed and comprehensive

international enterprise group, which combines research and design of hi-tech petroleum equipment, technical service

for oilfirled integrated engineering supply of oilfield comprehensive

solution and EPC turnkey projects.

www.keruigroup.com

THE DOW CHEMICAL COMPANYAn American multinational chemical

corporation headquartered in Midland, Michigan in the USA. As of 2007, it is the second-largest chemical manufacturer in the world by revenue and as of February

2009, the third-largest chemical company in the world by market capitalization.

wwwww.easterneurope.dow.com

KCA DEUTAGAn international oil and gas services

company with headquarters in Aberdeen, United Kingdom. It has

approximately 8,000 employees and operates in more than 20 countries.

www.kcadeutag.com

BALTIC CERAMICSBaltic Ceramics retails proppants and

other products used in the extraction of hydrocarbons from unconventional oil

and gas formations. Baltic Cerammics is the first proppant distributor on the

Polish market, and aims to build a large production facility through both private

and public funding sources.

www.balticceramics.com

TECH-POMP SERWISCompany provides services for oil

& gas industry. We supply complete, leak free water and other liquid transfer installations including pumps for various applications

(water, drilling fluid, mud, flowback), piping and all kind of

accessories.

www.watertransfer.eu

CLEANTECHis a consultancy for oil and gas

providing representation services. Cleantech Poland publishes the

Shale Gas Investment Guide and the magazine Cleantech.

www.cleantechpoland.com

FIND US

AGGREKO 88, 107 BALTIC CERAMICS 89CLEANTECH 90DOW 91KERUI 95KCA DEUTAG 95NTS 97NUTECH 97SAN LEON 81-82TECH-POMP 99

POLAND SHALE COALITION

was founded in 2013 to advocate for the human safe and

environmentally friendly production of gas from shales.


Poland Shale Coalition is proud to introduce its newest member, Aggreko Polska. Aggreko Polska is the regional office of Aggreko plc, the world’s largest temporary power company and a major supplier of temperature control equipment.

Listed on the London Stock Exchange (AGK.L), Aggreko is a member of the FTSE-100 index, and is headquartered in Scotland. Aggreko plc is the world leader in the supply of temporary power and temperature control solu-tions and provides solutions to custom-ers who need them either very quick-ly, or for a short or indeterminate length of time. Aggreko employs over 7000 people operating from over 200

countries. In 2014 over 55,000 custom-ers assignments were completed and the company had revenues of ap-proximately GBP 1.6 billion (USD 2.6 billion, EUR 2 billion). Aggreko aims to provide a consistent power supply to all regions facing acute power short-age through its power rental solutions and technical services, especially those bearing major obstacles for smooth industrial power generation.

We provide complete power manage-ment services for your Oil and Gas business:

• Fleet management• Fleet maintenance• Fleet deployment• Power site safety• Future planning • Remote monitoring• Reporting

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professionalism and we will

certainly look to collaborate with

them again in future projects as well as

recommending them to our affiliates”

Nicusor Nacu, Department Manager

of Energy Efficiency Program,

OMV PETROM S.A.Contact details:Aggreko Eastern EuropeSoseaua de Centura 7A, Tunari, Ilfov, 077180, RomaniaT: +40 31 405 22 08 , M: +40 752 225 985


The fifth Shale Gas World Europe upheld its status as a leading conference and trade fair for the unconventional gas industry in Europe. The event, taking place on November 25-26th, featured a series of interviews, workshops, debates, and roundtables.


Shale Gas World Europe

IN LATE NOVEMBER, Poland Shale Coalition exhibited at the Shale Gas World Europe 2014

conference in Warsaw, which wel-comed over 500 attendees ranging from shale gas operators, local and national authorities to license holders, investors, and solution providers.

The Shale Gas World Europe - Warsaw conference is in its 5th year



Protective gear on display on trade show floor

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Panelists, including Paweł Żuk of Hutton Energy, and Marcin Zięba of OPPPW, in conversation with moderator Paweł Poprawa of ISE

The event featured a number of country-focused roundtables

Keynote speaker addresses the audience about proving commerciality

The Poland Shale Coalition exhibited in a 10 m x 10 m pavilion

110 | SHALE GAS INVESTMENT GUIDE | S E A S O N 2 0X X110 | SHALE GAS INVESTMENT GUIDE | S E A S O N 2 0X X


Frank Thompson, Schlumberger, led a whisky tasting event at the PSC Pavilion; among those sampled was the Irish blended whisky Jameson

The PSC Pavilion featured both networking and exhibition space, as well as its own coffee bar

6th annual

The meeting place of Europe’s shale gas and oil industry

Join the largest gathering of stakeholders in European unconventionals as operators, licence holders, Government, regulators and leading minds in research return to Warsaw for Europe’s largest shale conference and exhibition

Book early for best rates at terrapinn.com/shaleeucleantech

17-18 November 2015 | Hilton Warsaw, Poland

Created and produced by:

Sponsors and exhibitors include:BOOK YOUR STAND NOWSponsorship and exhibition opportunitiesstill available. Get in touch with Faiz Alidinaon [email protected] or call +44 (0) 020 7092 1191

(1446) Shale World Europe 2015 Advert 210-297.indd 1 4/28/15 4:32 PM

Cezary Filipowicz of UOS leads a roundtable discussion Arne Kvamsdal of Halliburton at left with his colleagues



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6th annual

The meeting place of Europe’s shale gas and oil industry

Join the largest gathering of stakeholders in European unconventionals as operators, licence holders, Government, regulators and leading minds in research return to Warsaw for Europe’s largest shale conference and exhibition

Book early for best rates at terrapinn.com/shaleeucleantech

17-18 November 2015 | Hilton Warsaw, Poland

Created and produced by:

Sponsors and exhibitors include:BOOK YOUR STAND NOWSponsorship and exhibition opportunitiesstill available. Get in touch with Faiz Alidinaon [email protected] or call +44 (0) 020 7092 1191

(1446) Shale World Europe 2015 Advert 210-297.indd 1 4/28/15 4:32 PM


THE APRIL 15-16 conference sought to cover the unique oppor-tunities and challenges faced by

the country, such as the outcome of 14th UK licensing round, shale’s role in solving country’s energy woes, as well as issues regarding issuing permits and local communities concerns.

Shale Gas World UKThe third Shale Gas World UK conference brought together all parties interested in the future of Great Britain’s shale industry, ranging from license holder and operators, to government representatives.


The first day of the conference concluded with a drinks event



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Operators with a stake in UK shale include (from right) Andrew Austin (iGas) and Nick Grealy (London Local)

Andrew Austin of IGas at the podium Cover girl Anna McMaster of Hutton Energy with CFO, Grant Glanfield

Dennis McKee of UOS gave a keynote, as diamond sponsor of the event Networking at the trade show floor

Bez nazwy-1 1 2013-11-04 12:47:22

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SHALE GAS investmentSUMMER 2015

WHO’S WHO: EU | POLAND DISCOVERS TIGHT GAS | OPEC: FRIEND OR FOE? | PL&UK: ELECTION YEAR


5 SHALE YEARSWHERE ARE THEY NOW?

FULING FIELDSCHINA’S REVOLUTION

High Performance Products and Services

– OCTG

– Premium Connections

– Accessories

– Line Pipe

– Coiled Tubing

– Field Services

Ploiesti

Silcotub

Dalmine

Lublin Basin

Baltic Basin

Gdansk

Lublin

www.tenaris.com

Tenaris understands that every shale play is different

and every customer‘s challenge is unique. Providing

customized technology and reliable product quality

to minimize risk and maximize efficiency, we offer

integrated product and service solutions for every

stage of shale operations. Our TenarisHydril premium

connections deliver exceptional torque, bending

and compression for challenging extended reach

wells. Our Dopeless® technology offers additional

operational and environmental benefits. Tenaris’s

regional field services and technical assistance

teams are available 24/7, backed by global networks

of R&D, manufacturing and service centers.

Integrated Solutions for Unconventional Applications.

Tenaris provides field service support in the Eagle Ford shale for a local operator.

■ Shale Plays ■ Manufacturing Locations■ Service Centers — Delivery to the wells

ten117_polish_shale_ad_0719.indd 1 7/23/13 9:37 AM

9

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POLAND

SWEDEN

UNITEDKINGDOM

DENMARK

GERMANY

SPAIN

FRANCE

CZECH REPUBLIC

HUNGARY

ROMANIASLOVENIA

LITHUANIA

CROATIA

SLOVAKIA

LATVIA

BULGARIA

SWITZERLAND

IRELAND

NETHERLANDS

UKRAINE

BELARUS

RUSSIA

RUSSIA

ITALY

AUSTRIA

PORTUGAL

BELGIUM

ESTONIA

FINLAND

BOSNIASERBIA

MACEDONIA

ALBANIA

MONTENEGRO

GREECE TURKEY

NORWAY

SCOTLAND

EU-28 BASINS

LUXEMBURG



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Shale Gas Investment Guide, Vol 9, Summer 2015

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Transcript of Shale Gas Investment Guide, Vol 9, Summer 2015