Second Galicia? Poland’s shale gas rush through historical lenses ROBERTO CANTONI CERI – Sciences Po, UMR 7050, 56 rue Jacob, 75006 Paris, France 0000-0002-2526-2336 roberto.cantoni@sciencespo.fr Abstract: Since the early 2000s, the exploitation of shale gas has radically modified the US energy scenario. In a number of European countries, the US boom has elicited questions about its repeatability in Europe. Among the staunchest supporters of the development of national shale-gas resources were Polish administrations, which grounded their activism in this domain in the language of energy security, autonomy vis-à-vis Russian gas, and in Poland’s old oil history. The history of hydrocarbon exploration in the country dates back to the mid- nineteenth century, and is connected to the oil boom that occurred in the region of Galicia. While the boom was over by World War I, promising estimations made in recent years by several agencies about Poland’s shale gas reserves have stirred hopes of a ‘second Galicia’. From 2007, the Polish government started assigning permits to both national and foreign gas companies. However, factors linked to legislation, geology and macro- economics caused a premature end to hopes of Polish autonomy. After a reconstruction of the history of oil in Galicia and the constitution of the Polish oil and gas sector, this paper narrates the rise and fall of Poland’s ‘affair’ with shale gas. In April 2011, 1 month after the nuclear incident at the Fukushima Nuclear Power Plant in Japan, the International Energy Agency (IEA) proclaimed in its annual edition of the World Energy Outlook an emerging ‘golden age’ of natural gas to 2035. The IEA’s prediction was driven by the following expectations: considerable economic growth in China coupled with significant natural gas consump- tion; a low share of nuclear energy in electric power generation; an increase in the use of natural gas in the transportation sector; and a boom in unconventional gas and its low prices (IEA 2011a). As for the last aspect, the report alluded in particular to the ‘shale gas revolution’ occurring in the USA, where from the mid-2000s shale gas – that is, gas found trapped within shale geological formations – started to be extracted. Massive findings in the USA led to a rad- ical transformation of the American market: while in 2000 shale gas made up 2% of US natural gas sup- ply, in 2012 this percentage increased to 37% and it is expected to further augment to 65% by 2035 (Yergin 2012, p. 331). The US shale gas bonanza has quickly modified the whole world gas market, and Europe too is starting to be affected by the repercussions of this phenomenon, following the first deliveries of Amer- ican shale gas to the continent in mid-2016 (Macalis- ter 2016). Indeed, ever since the inception of the US shale-gas development, a number of EU countries have started to ‘think shale’: Polish administrations definitely stood out as Europe’s firmest shale advo- cates, together with the British government. Successive Polish governments were supported in their advocacy of shale gas by prominent national think-tanks. As an example, in May 2011 the neolib- eral Kosciuszko Institute, inspired by then-US Pres- ident Barack Obama’s visit to Poland and by his successful 2008 campaign slogan, published a policy brief titled: ‘Shale gas? “Yes, we can!”’ (Albrycht 2011). In the brief, the Institute’s chair, Izabela Albrycht, emphasized prospects for the development of shale gas in Europe, and in Poland in particular: prospects, which appeared rosy in the paper. Albrycht recommended that Poland facilitate the operations of gas companies through a number of liberalization measures and fiscal provisions. Supported by data published a month earlier by the US Energy Information Administration (EIA), which attributed to Poland Europe’s largest shale- gas resources – a fantastic 5.3 Tcm (trillion cubic metres), which the brief’s author claimed to be capa- ble of allowing Poland energy autonomy in gas sup- plies for the next 300 years – Albrycht went on to assert that the development of Polish shale gas would be seen as a ‘nightmare for Russia’, as it would liberate the country from its energy subjuga- tion to Moscow, and enable Poland to export its shale gas to other EU countries (Albrycht 2011; EIA 2011). The Kosciuszko Institute was not the only Polish institution unreservedly advocating shale gas. Thanks to the establishment of a flourish- ing shale-gas industry, a Polish chief executive of a Warsaw-based recruiting firm argued in the Wall Street Journal in August 2011 that between 50 000 From:CRAIG, J., GERALI, F., MACAULAY, F. & SORKHABI, R. (eds) History of the European Oil and Gas Industry. Geological Society, London, Special Publications, 465, https://doi.org/10.1144/SP465.16 © 2018 The Author(s). Published by The Geological Society of London. All rights reserved. For permissions: http://www.geolsoc.org.uk/permissions. Publishing disclaimer: www.geolsoc.org.uk/pub_ethics by guest on October 3, 2018 http://sp.lyellcollection.org/ Downloaded from