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Oil and Gas Drilling Company PNiG Nafta plc is an international drilling contractor with more than 55 years of experience in drilling for exploration and production oil and gas wells. Courtesy of PNiG Nafta

Warsaw, Poland – July 27, 2012

Polskie Górnictwo Naftowe i Gazownictwo SA (PGNiG) has found gas shows in the Komorze -3K deep exploration well being drilled in Greater Poland.

According to current expert opinions, the exploration work has a considerable chance of success.

The well is being drilled in cooperation with US company FX Energy Poland sp. z o.o.
With a 51% interest, PGNiG SA is the owner of the exploration licence and its operator, while FX Energy Poland sp. z o.o. holds a 49% interest.

Oil and Gas Drilling Company PNiG Nafta plc is an international drilling contractor with more than 55 years of experience in drilling for exploration and production oil and gas wells.
Courtesy of PNiG Nafta

The natural gas flows in the Komorze - 3K well were noted while coring the interval from 3,971 m to 3,985 m.

The contractor for the drilling work is PNiG Nafta, a company of the PGNiG Group.

Oil and Gas Drilling Company PNiG Nafta plc is an international drilling contractor with more than 55 years of experience in drilling for exploration and production oil and gas wells.

“I have worked in more than 30 countries and have never worked with any group of people I consider more professional and co-operative. This applies to everyone from management to rig personnel.”

- Bob B. Berry, Project Manager, BG Exploration and Production India Limited
Courtesy of PNiG Nafta

Further work planned to be done in Komorze - 3K includes coring, drilling the well to the target depth of 4,075 m and logging.
The final stage will involve a production test.

The purpose of the Komorze 3K well is to investigate a gas lead within Rotliegend sandstones, in an area containing a conventional gas discovery.

According to current expert opinions, the well has a considerable chance of success.

Grażyna Piotrowska-Oliwa, CEO & President of PGNiG
Courtesy of PGNiG

The recorded gas shows are similar to the shows identified during drilling of the Lisewo-1 well, located at a distance of approx. 4 km, where a gas discovery has been made.

Komorze 3K is another deep well being drilled by PGNiG SA.

In 2010, drilling work started on the Niebieszczany-1 exploration well near Sanok in the Carpathians, which was finished in 2011.

Also in 2011, the Dukla-1 exploration well was spudded in the Rzeszów Province.

Warsaw, Poland – July 04, 2012

Five companies execute shale gas exploration agreement

The framework agreement executed on July 4th 2012 between five Polish companies, i.e. PGNiG, ENEA, KGHM Polska Miedź, PGE and TAURON Polska Energia, will help accelerate shale gas exploration work.

In accordance with the agreement, estimated expenditure on gas exploration, appraisal and production at the first three pad locations (Kochanowo, Częstkowo and Tępcz) will amount to PLN 1.72bn.

First gas produced as part of the joint project may be expected to flow in 2016.

The cooperation agreement between PGNiG, KGHM, ENEA, PGE and Tauron Polska Energia provides for extending its territorial scope in the future beyond the Kochanowo, Częstkowo and Tępcz pads.
Courtesy of PGNiG

Under the agreement, joint work will be conducted on a part of the Wejherowo licence held by PGNiG, and specifically on the Kochanowo, Częstkowo and Tępcz pads (the KCT project), where preliminary surveys and analyses have confirmed the presence of shale gas.

The area in the Wejherowo licence covered by the cooperation agreement is ca. 160 sq km.

Each of the investors will have a specific percentage share in the KCT project budget, with estimated budget expenditure of up to PLN 1.72bn.

Each party will be guaranteed involvement in the process of supervising the project implementation by participating in the operational committee appointed for that purpose.

In accordance with the agreement, PGNiG will be the licence operator throughout the exploration and appraisal phase.

Assuming that the work proceeds in line with the preliminary schedule and ends in a success, production launch may be expected in three years' time.

At the production stage, operatorship will be entrusted to a special purpose vehicle which will hold the production licence.


Mikołaj Budzanowski, Minister of the State Treasury of Poland Courtesy of Polish Ministry of Treasury

Mikołaj Budzanowski, Minister of the State Treasury:

“This cooperation between mining and power companies will enable us to leverage economies of scale, thanks to which we will sooner know the productivity of our deposits. It is also the right way to a long-term goal: looking for new ideas and developing innovativeness. If we fail to do that, we will not meet the challenges inherent in the EU climate policy and the related necessity to limit CO2 emissions. Poland's economy as a whole may benefit from shale gas, and for the Polish power industry it is a chance to become modern and competitive against the European background. By engaging in gas exploration now, the power companies are securing access to less expensive Polish gas supplies for their gas-fired power plants which are currently under construction.”


Grażyna Piotrowska-Oliwa, CEO & President of PGNiG Courtesy of PGNiG

Grażyna Piotrowska-Oliwa, President of PGNiG SA:

“With today's agreement we have advanced on the road to reaching our strategic objective of enhancing the independence and competitiveness of Poland's economy. Production of shale gas will facilitate ensuring stable energy supplies at prices acceptable by the market. Combining the economic potential of our partners with PGNiG's resources in the form of licences, expertise and experience of our employees, guarantees our common success. I believe that in the near future we will be sharing considerable profits."


The Wejherowo licence, under which the cooperation will be conducted, is one of the 15 shale gas exploration licences currently held by PGNiG. Courtesy of PGNiG

Herbert Wirth, President of KGHM:

“In the modern world commodity resources are one of the most important drivers of the economic position not only of companies which are engaged in their development but also of the states which directly or indirectly control them. Commodity security in the global economy is the future of KGHM. Polska Miedź is one of the few Polish companies which today have real access to commodity resources on the global market. Concurrently, we seek to get involved in projects to obtain cheaper sources of energy. Securing access to own gas resources is important for us for economic and environmental reasons. We hope that the project will be our common success.”


Analyses of the gas, coming from Silurian and Ordovician shales, have confirmed its very good energy characteristics, absence of hydrogen sulphide, and low nitrogen content. Courtesy of PGNiG

Krzysztof Kilian, President of the PGE Group:

“Diversification of fuels is one of the priorities for PGE Polska Grupa Energetyczna SA. PGE has decided to participate in the project because the work carried out to date shows that it is likely to be successful in business terms. Likewise, access to own resources will reduce the uncertainty related to decisions made as part of the climate policy.”


The cooperation agreement between PGNiG, KGHM, ENEA, PGE and Tauron Polska Energia provides for extending its territorial scope in the future beyond the Kochanowo, Częstkowo and Tępcz pads. Courtesy of PGNiG

Maciej Owczarek, President of ENEA:

“We can see a great opportunity in this alliance, so important for the Polish power sector. It is a chance not only to change our long-standing fuel mix and finish the dominance of coal, but also to become independent from external gas supplies, and thus to strengthen our country's energy security. As ENEA Group we are monitoring the market in search for interesting projects and investments, seeking to create an optimum mix of fuels and to ensure development of the Group on many platforms. Today's agreement shows a real alternative for the Polish power industry and for our clients, and we must be a part of it. Gas is an important source of energy, and thanks to shale gas Poland will be able to secure its energy security and independence, which is what we want as representatives of the industry and what our clients want.”


The framework agreement executed on July 4th 2012 between five Polish companies, i.e. PGNiG, ENEA, KGHM Polska Miedź, PGE and TAURON Polska Energia, will help accelerate shale gas exploration work. Courtesy of PGNiG

Dariusz Lubera, President of TAURON Polska Energia:

“The TAURON Group is currently constructing a CCGT unit in Stalowa Wola jointly with PGNiG, and we are preparing to launch similar investment projects in Kędzierzyn-Koźle and Katowice. In a few years' time, we will become a major gas consumer. We expect to use nearly 2 billion cubic metres of the fuel annually, and therefore we have decided to also become involved in its acquisition. Our experience shows that access to own resources is a considerable market advantage. In order to secure fuel for the TAURON Group's production operations and guarantee power supplies to our customers, we are primarily planning to use our own assets, such as hydrocarbon production facilities, power plants or CHP plants, but also to diversify the sources of our gas fuel supplies.”


In accordance with the agreement, estimated expenditure on gas exploration, appraisal and production at the first three pad locations (Kochanowo, Częstkowo and Tępcz) will amount to PLN 1.72bn. First gas produced as part of the joint project may be expected to flow in 2016. Courtesy of PGNiG

The cooperation agreement between PGNiG, KGHM, ENEA, PGE and Tauron Polska Energia provides for extending its territorial scope in the future beyond the Kochanowo, Częstkowo and Tępcz pads.

However, the terms and conditions of such future cooperation would be defined in a separate agreement.

The Wejherowo licence, under which the cooperation will be conducted, is one of the 15 shale gas exploration licences currently held by PGNiG.

According to experts, it is one of the most prospective ones, as evidenced by the results of work performed by PGNiG in the Lubocino 1 well, where fracturing operations carried out in September 2011 resulted in a gas flow.

Analyses of the gas, coming from Silurian and Ordovician shales, have confirmed its very good energy characteristics, absence of hydrogen sulphide, and low nitrogen content.

Contact:

Joanna Zakrzewska
Spokesperson for PGNiG SA
PGNiG SA

Press Team
01-224 Warszawa, Poland
M. Kasprzaka 25 St.
fax: +48 22 691 82 24
e-mail: rzecznik@pgnig.pl

Source: PGNiG SA

http://www.pgnig.pl/pgnig/com/8387

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