By Marynia Kruk
WARSAW--Exxon Mobil Corp's (XOM) decision to pull the plug on
its efforts to explore for shale gas in Poland isn't what's dousing
its local rivals' enthusiasm for the unconventional resources
prospects in the central European country, it's the bureaucratic
apathy, industry participants said Tuesday.
The industry's frustration with Poland's red tape is palpable as
people accustomed to the friendly and expedient regulators of North
America collide with government bodies which haven't completely
shaken off the mentality of central planning.
"In North American we drill on Christmas, New Year's and
Easter," said John Buggenhagen, Exploration Director of San Leon
Energy PLC (SLE.LN). "Here the regulator says they'll get back to
us on Monday."
The Polish government hopes to replicate the energy bonanza the
U.S. is currently experiencing, especially since it offers the
chance to free Poland from imports of what it sees as over-priced
natural gas from Russia.
But official high-level declarations jar with the day-to-day
challenges those drilling test wells face in the former Soviet
satellite country that made the jump to a market economy 23 years
ago. The Polish Environment Ministry, which is responsible for
handling concessions, wasn't immediately available for comment.
Delays in feedback from regulators cost hundreds of thousands of
dollars as the few drilling rigs operating in Poland sit idle or
have to be dismantled and moved to another site until the
regulatory issue is resolved and drilling can resume in the
original location.
A particular irksome bottleneck is the Environment Ministry's
practice of asking license holders to resubmit applications and
repeat environment impact assessments if they want to drill deeper
than stated in the original application, said Mr. Buggenhagen, who
would like to see the ministry increase its staff to more quickly
serve companies such as his.
Still, unlike Exxon, San Leon is sticking around for now. In
May, the company said it had been awarded an exploration license in
southern Poland, expanding its acreage in the country and
increasing its conventional and unconventional oil and gas
prospects.
Write to Marynia Kruk at marynia.kruk@dowjones.com
