Polish PM Promises 50bln PLN for Shale Gas Development

Faced with polls showing declining support and opposition sharpening their knives, the Polish Prime Minister called for a parliamentary vote of confidence.

In his speech, Donald Tusk proposed multi-billion investment programs, one of them targeting shale has development.

According to the Polish PM, PGNiG, Orlen, Lotos, KGHM and Tauron are to finance exploration costs and build four "mines" or multiply wells pads until 2016.

In response to questioning by tvn24 news, Jan Krzysztof Bielecki, the economic adviser  to the Prime Minister explained that the figure of 50 bln zloys (12 bln EUR, 16 bln USD) marked for investment in shale gas development included foreign companies investments as well.

State controlled oil and gas companies are already carrying out their exploration programs. The gas company PGNiG and oil refiner Orlen are currently executing horizontal wells projects in Pomorze and Lubelskie. Both companies plan to spend up to several billions on further exploration.

In July other state-controlled raw materials companies and utilities signed the agreement to invest  under 2 billion zlotys in shale gas projects in the northern Pomorze province until 2015.

Polish government and state controlled companies also earmarked a billion zlotys to support development of indigenous technologies for the extraction of hydrocarbons from unconventional sources.

Tusk added that his government expects all political forces to join discussions on new shale gas bill draft.

"We will be open to all proposals aiming to optimize this project",  the PM declared.  "This bill must become a subject to debate, as shale gas bill cannot become a property of this cabinet, neither of following ones, because it is meant to be an energy and financial protection for all Poles."

PM Tusk announced that after months of works, his cabinet would pass next Tuesday a shale gas bill. As the PM explained, new regulations should encourage investors and secure state control.

The legal framework has been long awaited by the international companies. They expect liberalization of the gas market in Poland but also realize that current low taxation level is untenable.

Although Tusk’s cabinet survived confidence vote, his ruling Platforma Obywatelska (Civic Platform)  has lost its top position in polls, first time since 2007.