In the United States of America and Canada fracking shale for natural gas has proved a profitable enterprise. In some parts of the US the price of natural gas has dropped significantly as a result of gas “fracked” and as a consequence of burning natural gas instead of oil or coal, the USA has emitted less carbon dioxide. This raised hope that fracking would produce the same results in Europe as it did in the USA and one of the best possibilities for fracking was in the shale deposits of Poland.
Two major companies explored Poland for fracking opportunities – Talisman Energy and Marathon. They have now pulled out of fracking in Poland; Marathon failed to find commercial volumes of hydrocarbon fuel. Last year Exxon pulled out but Chevron and ENI are still exploring.
The estimate of natural gas reserves in Poland by the US Energy Information Administration was 5.3 trillion cubic metres, which would supply Poland with gas for nearly 300 years, assuming that consumption does not increase. However it seems that those estimates have proved wildly wrong and although there may be some gas to find it seems likely that if it is hard to find the costs of tapping into it will be huge – and make commercial operations unviable.
The enthusiasm for fracking seems to be based as much on political enthusiasm for energy independence and hope, as on science and commercial analysis.
I expect that following the experience of what is happening in Poland firms exploring for fracking possibilities in the United Kingdom may well want some level of subsidy from the UK government in some form in order to undertake the exploration.
I have analysed the viability of producing natural gas from fracking elsewhere in these posts and the environmental risks. I would point out that the more expensive it is to find and frack gas, the more likely that the environmental safety procedures, yet to be fully put in place, will be breached.
I also rather expect that fracking in the USA will be a short lived enterprise, and that investment in fracking will prove a poor investment, unless the fracking companies can persuade the government to provide a taxpayer subsidy.
Filed under: climate change | Tagged: climate change, energy information administration, environment, estimates of shale gas reserves in Poland, fracking, natural gas, natural gas reserves, Poland, shale deposits, US Energy Indfromation Administration |