Shale gas is
safe

With dr. Jan Krasoń, geologist, consultant of energy companies from the USA, initiator of the search for unconventional shale gas deposits in Poland, talks Mariusz Bober.

You are the pioneer of unconventional shale gas exploration in Poland. How do you assess the exploration status for the "Polish blue gold" from today's perspective?

- The matter has gained considerable momentum, and the drilling carried out so far promises great discoveries and reveals development prospects for Poland. The discovery of enormous shale gas resources, which can only be estimated, would allow Poland to become independent from importing this essential energy resource. Even though unconventional shale gas has been extracted relatively recently (so far only in the United States), it has already become one of the basic raw materials for energy. Although its composition does not differ from the conventional gas, its extraction is slightly more difficult and expensive. Although still not fully known, the results of exploratory drillings in Poland seem to be very positive. Therefore I am happy that I could still serve my homeland in this way.

The US Energy Information Agency estimates said that Poland has 5.3 trillion m3 of shale gas. Do you confirm these data?

I am generally speaking about the results of the exploration so far. Because large energy corporations, not only American ones but also Polish Oil and Gas Company (PGNiG) and other domestic and foreign companies, must be involved in shale gas exploration in Poland. Already preliminary exploratory drillings confirm that the chances of discovering large gas deposits in Poland are huge. It is indicated, among other things, by the content of organic carbon and other important properties of shale rocks. Such parameters as the thickness of the shale series (i.e., the thickness of the layer of shale rocks), hardness of these rocks and their fracture density are also good. These results are an excellent incentive for energy companies to search for shale gas in Poland.

However, some European politicians and organizations would love to ban these explorations under the pretext of negative environmental effects. The European Commission has even ordered a report on the impact of shale gas exploitation. Are such fears justified or somewhat politically motivated?

- In Europe, it results first of all from the fear of potential competition from the Polish gas. Politicians are also frightening society with some negative effects of exploiting this gas for the environment. Personally, I think the point is to create a climate for establishing regulations that make exploration for unconventional resources of the blue fuel more difficult. Some people also don't want Poland to become independent from Eastern gas supplies and, therefore, a competitive raw material supplier to the European market. And yet, in the economic reality, energy sources function as a kind of blood circulation for each country's economy and are extremely important for its existence. Just as man cannot live without blood, the everyday life of population, economy and development become impossible without energy. And gas is one of the primary energy resources.

Just as man cannot live without blood, normal life of population, economy and development of the country become impossible without energy.

Does the U.S. Department of Energy report dispel concerns about the negative environmental impacts of shale gas production?

As far as I know, the report indicates that if certain conditions for the exploitation of this gas are met, neither environmental nor groundwater pollution is caused. The best evidence that shale gas is safe is that more than 35,000 shale gas exploration and production drill holes have been drilled so far in the United States alone. It has not been found to lead to environmental contamination. Moreover, exploratory drilling has been and continues to be carried out even in areas located within the cities themselves, e.g., in the town of Fort Worth in Texas, where there are over 2 thousand drilling holes currently used for production.

Environmentalists claimed that's where the water intakes were contaminated.

There was no contamination of water intakes with shale gas! One should also remember that groundwater typically occurs no deeper than 200 to 300 meters below the ground level in Poland. In most cases, naturally mineralized waters are found at deeper depths. These waters without special treatment are not suitable for drinking, irrigation, or other purposes. Meanwhile, rock series containing shale gas in Poland occur at depths of less than 2,000 meters. I taught hydrogeology for many years and made much hydrogeological expertise in the past. Therefore, I know the geological conditions of occurrence of groundwater and deep waters in Poland, Libya, Egypt and the USA.

What, then, do the videos that scare people about shale gas published on the Internet actually show?

Shale gas does not contaminate water intakes in average terrain and geological conditions. Scaring people about its harmfulness is very catchy because it takes advantage of the undoubtedly justified sensitivity of all consumers of drinking water to its quality, especially the water that goes to kitchen taps. The fluid used in hydraulic fracking and shale gas extraction is completely separate from potable groundwater. The liquid used in gas drilling, called drilling mud, contains more than 90 percent water and sand. The drilling mud itself, or with half to a few percent chemicals added, is not harmful to the environment. Such mud is forced into fractures and cracks during short-term fracturing. The drilling fluid's high pressure opens up the fractures, and the liquid penetrates them. The mud flows out when the pressure is gone, but the sand remains and "opens up" the rock fractures, releasing gas, which flows into the borehole. The amount and chemical composition of the chemicals added to the drilling mud, modified according to the physical and chemical properties of the shale rock, is the technological secrets of each drilling and oil company. Nevertheless, in the U.S., some states (e.g., Colorado), under pressure from the need to protect the environment, have required oil companies to agree to publicly disclose the entire percentage chemical composition of the mud injected for hydraulic fracturing.

How does the American public view the exploitation of shale gas?

As a matter of fact, in the U.S., the residents of areas where shale gas deposits have been discovered and are being exploited are very happy about it. The owners of gas-bearing areas also have rights to these resources [in the U.S., the owner of resources is the person who owns the land - ed.] and can share in the often substantial profits from gas production. Production is also beneficial for all American consumers because several years ago, shale gas prices dropped significantly after the beginning of its exploitation. Today in the USA, all gas consumers pay 3-5 times less than consumers in Poland. Most of the gas in Poland is imported from Russia, which dictates the prices as they are almost a monopolist in Europe.

Production is also beneficial for all American consumers because several years ago, shale gas prices dropped significantly after the beginning of its exploitation.

How will shale gas production in Poland change the energy market in Europe?

Conventional gas is usually extracted from regular deposits over a dozen years. However, the production of unconventional shale gas may take a shorter period. In Poland, it is assumed that it will take about 10-15 years to prepare for industrial gas production, although in my opinion, this will happen much earlier, within a few years. In the U.S., in some areas, shale gas production is started within such a period. As for the production volume, the most important thing for Poland is that it will be able to stop importing gas because it will be self-sufficient. The price of this raw material for retail customers, as well as for the industry, will undoubtedly significantly drop. It may lead to a fall in prices on the European market and a fall in companies' earnings selling gas in Europe. It is also crucial that Poland has a good investment climate for foreign investors. It also makes significant investments and money go to the Vistula.

Who is Polish gas likely to compete with in the first place? The Committee on Energy and Climate Change of the British House of Commons sees Poland as a rival and wants to monitor our exploration...

Yes, these are very worrying reports. Political motives are also evident here. It's about, i.a., fears of competition for the Russian-German Nordic Gas Pipeline, built on the bottom of the Baltic Sea. The United Kingdom will also receive gas from this pipeline. Moreover, the British are afraid of competition for their producers and importers. Meanwhile, Polish shale gas is unlikely to compete on the European market soon. However, those afraid of it try to prevent such competition with their actions.

But the British are running out of gas resources, so they will be doomed to import anyway. Why do they not want to buy gas from an additional source from Poland?

We know that conventional oil and gas resources in the North Sea have been exploited for several decades. Although new oil fields are still being discovered, the deposits are close to exhaustion. Therefore, I believe that the UK may soon be supplied with raw material from the Northern Gas Pipeline. The second, maybe even more important motive of the British is the prejudice against potential gas from Poland because they count on exploiting shale gas themselves, also from the North Sea area. But that potential gas will have to wait for much longer than the more viable gas from Poland.

A committee of the British House of Commons shows exceptional hypocrisy. On the one hand, it encourages the government to give tax relief to investors who extract shale gas from beneath the bottom of the North Sea. At the same time, it says that the exploitation of this resource poses a threat of environmental pollution. After all, exploration under the seabed is more dangerous.

Yes, this is indeed an example of apparent hypocrisy. It is true that offshore drilling is much more expensive and potentially more dangerous to the environment than drilling on land. But in terms of technical capabilities, they are slightly different from drilling on land. The problem is rather the much higher cost of offshore exploration. The prices of drilling platforms and exploratory and production drilling conducted from them are high. Therefore, gas reserves must be enormous to make it profitable to extract gas under the seabed. Concerning offshore drilling, we should note that, according to World Oil (February 2011), the deepest offshore drilling was performed by ExxonMobile last year in the Sakhalin-1 license. The depth reached was 12,341 meters, and then the hole was extended by horizontal drilling to a distance of 11,472 meters. It shows that drilling, also offshore, including horizontal drilling over a long distance, is technically possible today! Let's hope that the gas resources are large enough and economically profitable for exploitation.

It shows that drilling, also offshore, including horizontal drilling over a long distance, is technically possible today!

Would Poland's offering of a larger gas supply to the European market and a drop in commodity prices undermine the viability of shale gas extraction from the North Sea?

I believe not. In such a case, I would like to repeat - be the main factors determining the rationality of shale gas exploration and production from the bottom of the North Sea will be: the size of gas resources, the cost of their exploration and production, and consequently, their profitability in the context of competitive prices of various suppliers on the European market.

If it is now technically possible to extract shale gas under the seabed, why are Polish companies with concessions in the Baltic reluctant to make such plans? Recently Lotos Petrobaltic admitted that it does not even plan to drill on its offshore unconventional gas concessions in the nearest future because "nobody in the world has yet extracted gas from unconventional deposits in the sea"...

Last year I attended a conference on energy resources in the Baltic Sea, which was attended by, among others, some Lotos Petrobaltic representatives. They presented the results of one of the boreholes recently drilled in their concession in the Baltic Sea. When I asked about the efficiency of the gas mined from the borehole through the layer of shale above the production horizon, the speaker said they had not tested the presence of gas in the shale. It shows how skeptically the authorities of the mentioned company approached the exploration of unconventional shale gas resources in the Baltic Sea, at least until last year. Meanwhile, there are undoubtedly possibilities of discovering considerable raw material resources and crude oil in this area. I know about it because in 1991, together with an experienced American petroleum geologist, we conducted a study of the economic viability of the B-3 oil field in the Baltic Sea. The earlier assessment of this field by the experts of Petrobaltic at that time was negative because the oil resources were considered unprofitable to start production. However, after our economic assessment, the field has been exploited since 1994 [Petrobaltic produces oil and conventional gas there - ed.]

Due to the distrust of Polish companies towards unconventional gas deposits, did you look for foreign investors willing to explore shale gas?

At that time, PGNiG and other Polish oil companies had no experience in shale gas exploration. Drilling this kind of exploration boreholes on a large scale in many different areas of Poland is a great challenge, especially financially. Poland has already benefited from opening to foreign investors. Also, it will be possible to explore Polish resources of energy raw materials, minimizing own costs and risk of such exploration. In the case of deep drilling, especially oil and gas exploration, these costs and risks are enormous. Exploration financed by foreign investors will contribute to a more detailed examination and recognition of the deep geological structures of Poland. We should also consider that each exploratory borehole, if there are no economically viable gas resources to exploit, also means the risk of a loss of investment, often reaching several dozen million PLN.

Thank you for the interview.