Bloomberg: Poland Shale Boom Falters as State Targets Higher Taxes

Poland’s shale gas boom is threatened even before it gets started after some wells failed and the government sought to increase taxes on profits.

Of 39 wells planned for 2013, just two were drilled by May, Environment Ministry data show. The government plans to require that explorers take a state-run company as a production partner. It has also proposed raising taxes to almost 80 percent of profit, according to Ernst & Young estimates. The measures, announced in October, haven’t become law.

“What’s been done here is what Poles call dividing up the bear hide before you’ve shot the bear,” said Tom Maj, who led the Polish operations of Talisman Energy Inc. (TLM), the Canadian explorer that pulled out of Poland earlier this month. “This has been hugely damaging to the shale gas project as evidenced by the negligible number of wells of the past few months.”  MORE