EurOil: Orlen reports large oil discovery in west Poland

Polish energy giant Orlen announced on September 11 it had made one of the country’s biggest oil discoveries in over a dozen years, containing 100,000 tonnes (730,000 barrels) of recoverable crude oil.

In terms of international standards, the find is relatively small. Poland does not have much in the way of oil reserves. The overall resources at the site are estimated at more than 500,000 tonnes of oil, or 3.67mn barrels, Orlen said.

“The Rzeczyca deposit is one of the largest oil discoveries in Poland in the last dozen or so years. It is a great success of our geologists and engineers,” Orlen’s president of the management board, Ireneusz Fafara, said in a statement. “Launching the exploitation of these resources will bring benefits not only to Orlen, but also to local government units.”

The local government is set to receive as much as 90% of the extraction tax on oil and gas. “This means that, taking into account the planned extraction, additional revenues to the commune budget may amount to as much as one million zlotys per year,” he said.

The discovery was made by the Rzeczyca-1 exploration well, drilled in the town of Grodziszcze, to a depth of 2,750 metres within the 24/95/L concession. Drilling began in June and lasted 63 days, and was carried out by Orlen’s subsidiary Exalo Drilling.

Tests showed that the find is commercially variable, Orlen said. Once the find is developed, the well will produce around 16,500 tonnes per year (330 barrels per day) of oil. This oil can be transported by pipeline to the nearby Radoszyn oil and gas field.

Furthermore, analysis also indicated additional large quantities in nearby geological structures, the company said. “We can therefore expect further significant discoveries here with great probability,” it said.

What domestic oil production there is in Poland is concentrated in its west, primarily in the Lubuskie region. Among the largest producing deposits are Lubiatów, Międzychód, Grotów and Barnówko-Mostno-Buszewo. Orlen is a leading domestic producer, lifting 824,000 tonnes of oil, condensate and natural gas liquids (NGL) last year.

If you’d like to read more about the key events shaping Europe’s oil and gas sector then please click here for NewsBase’s EurOil Monitor.