Eni Pulls Out of Polish Shales

Italy’s Eni is likely to abandon its shale gas projects in Poland due to unclear regulation and difficult geology. The daily newspaper Puls Biznesu reported that the oil and gas major would let its three concession fade out.

According to a statement sent by the Polish environment ministry to Reuters, two of three shale gas exploration licenses have expired and the company does not intend to renew them. 

Eni has a third license that will expire in June 2018.

Recently, the Polish government’s attempt at mandating co-operation in shale gas sector amongst state controlled enterprises has crumbled. Reports indicate that a deal amongst the five players will lapse.

In December, Piotr Wozniak, Poland’s Deputy Environment Minister and Chief National Geologist, has been removed. Environment Minister Maciej Grabowski dismissed Wozniak, replacing him in both positions with Slawomir Brodziński. Wozniak was responsible for drafting laws setting out regulations for the development of the shale gas industry and for licensing procedures.  This reshuffle indicates the difficulties within the Polish government to foster a shale gas industry that would decrease Warsaw’s reliance on imports from Russia.

ExxonMobil was the first company to pull out of the country. Marathon Oil and Talisman Energy followed in 2013.

If Eni will leave as well, Chevron and ConocoPhillips would be the last two companies committed to a shale gas industry in Poland.