Exxon Mobil this week said it was abandoning its shale natural gas ambitions in Poland. Warsaw aims to tap into its shale deposits in an effort to break the Russian grip on the natural gas sector.
The country recently scaled back its shale reserve estimate, however, and is set to unveil a new series of laws governing the emerging sector. Nevertheless, the move by Exxon did little to shake other explorers like Chevron, and with Exxon moving closer to Russian developments, its departure from Poland isn’t the end to the shale story there.
The U.S. Energy Department’s Energy Information Administration had estimated that Poland could hold as much as 5.3 trillion cubic meters of natural gas. That would be enough for the country to satisfy domestic demand for the next 300 years, effectively cutting the Kremlin out of Warsaw once and for all. A Polish review of shale deposits revealed in March, however, that the reserve estimate was closer to 550 billion cubic meters on average.
Though acrimony from the Cold War era lingers in Warsaw, the Polish energy sector remains heavily dependent on Russia for oil and natural gas. Officials at Russian natural gas monopoly Gazprom shrugged off the shale bonanza by saying Polish natural gas would be an expensive commodity for potential consumers. At the same time, however, Gazprom said that its own natural gas designated for the South Stream natural gas pipeline was a secure source despite what it expects to be an expensive resource.
