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Poland gas find threatens Russia’s hold over EU

Europe’s dependence on Russian gas could be over - but at what cost to the environment?

BY TIM EDWARDS

LAST UPDATED 7:25 AM, APRIL 7, 2010

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ast reserves of shale gas lying under Poland could free Western Europe from its dependence on Russian natural gas in the future with the help of recent advances in American extraction technology.

According to the Times, energy consultants Wood Mackenzie estimate up to 1.36 trillion cubic metres of unconventional shale gas could be lying under northern and central Poland. If the find is confirmed it will increase the EU's reserves by 47 per cent and offer a more reliable alternative to Russia's vast natural gas supplies. ConocoPhillips is planning to start drilling near Gdansk next month and will be followed ExxonMobil.

The EU's dependence on gas from the Russian state monopoly Gazprom has long been a cause of concern. In 2009 Europe is thought to have imported around 33 per cent of its gas from Russia. While Britain is not yet dependent on supplies from Moscow, it will begin importing substantial quantities via Nord Stream, a new Gazprom-owned pipeline, by 2012.

Russia has already proven itself willing to use its gas reserves as a weapon in diplomatic negotiations. Moscow cut gas supplies to Ukraine in January 2006 during a row over gas prices and debts. In January 2009, European countries received no Russian gas via Ukraine for three weeks while Moscow and Kiev again argued over pipeline transit fees and gas prices.

Meanwhile, there is concern that the Gas Exporting Countries Forum (GECF), which includes Russia and Algeria, the two major gas exporters to Europe, could one day become a "gas OPEC", able to set quotas and prices as the oil cartel does. Iran and Venezuela, while not particularly large gas exporters, are also members.

The idea of elevating GECF to cartel status was first suggested by Vladimir Putin, then resident, in 2002. In 2006, Aleksan  Medvedev, Gazprom's deputy chairman, threatened to create "an alliance of gas suppliers more influential than OPEC" if Europe did not play ball in energy negotiations.

It is with relief, then, that the likes of Poland have been watching recent advances in shale gas extraction technology in America that have led experts to increase the lifetime of US gas supplies from 30 to 100 years.

Despite continuing fears that the world has already reached 'Peak Oil', new estimates of available 'alternative' gas reserves, such as shale gas, keep climbing. Besides America's 120 trillion cubic metres, Australia boasts 22 trillion cubic metres, while there are large reserves in Germany, India and South Africa. The potential over-supply of gas has led some in Russia to fear Gazprom may have overplayed its hand with its bullying tactics against the Ukraine.

But Gazprom may have a friend in the US Environmental Protection Agency. While burning gas for power gives off only half the carbon of coal, there are serious concerns over the environmental

impact of the process of extraction. 'Fracking' involves drilling down up to 6km while injecting chemicals and sand into the earth to fracture the shales. In March, the EPA announced it is to investigate the impacts of the process on human health: if fracking takes off in Poland, it can only be a matter of time before European environmental agencies follow suit.