Exploration in Poland
In 2014, PGNiG S.A. was involved in crude oil and natural gas exploration and appraisal projects in the Carpathian Mountains, Carpathian Foothills and Polish Lowlands, both on its own and jointly with partners. Drilling work in the areas covered by licences awarded to PGNiG S.A was performed on 24 wells, including 15 exploration wells, 6 research wells and 3 appraisal wells. Out of the 24 boreholes, ten were drilled in search for hydrocarbons from unconventional sources.
In 2014, six wells yielded positive results, including one exploration borehole in Pomerania (drilled in previous years), two exploration boreholes in the Greater Poland region, and three appraisal boreholes in the Carpathian Foothills (including one drilled into unconventional deposits). 14 wells (five of which had been drilled in previous years) failed to yield a commercial flow of hydrocarbons and were abandoned.
The PGNiG Group was also involved in exploration and appraisal work in Pakistan, Norway and Libya, but discontinued exploration activities in Egypt. The exploration and appraisal work in Norway and Libya was carried out by PGNiG S.A. subsidiaries, i.e. PGNiG Upstream International AS and Polish Oil and Gas Company-Libya B.V., respectively.
PGNiG S.A. conducts exploration work in Pakistan under an agreement for hydrocarbon exploration and production in the Kirthar licence area, executed between PGNiG S.A. and the government of Pakistan on May 18th 2005. The work in the Kirthar Block is conducted jointly with Pakistan Petroleum Ltd., with production and expenses shared in proportion to the parties’ interests in the licence: PGNiG S.A. (operator) – 70%, PPL – 30%. In 2014, PGNiG S.A. began preparations to drill appraisal boreholes Rehman-2 and Rehman-3 (scheduled for completion in 2015 and 2016). PGNiG S.A. had to declare a force majeure event and suspend work on the Rizq-1 well on two occasions due to armed attacks in the region. Work on Rizq-1 was resumed in late December 2014. Production from the Rehman-1 and Hallel X-1 wells continued uninterrupted, and the extracted gas was supplied to the Pakistani transmission system.
PGNiG Upstream International AS holds interests in exploratory and production licences on the Norwegian Continental Shelf, in the Norwegian Sea, in the North Sea, and in the Barents Sea. Jointly with partners, the company has been producing hydrocarbons from the Skarv field (Skarv project) and developing the Snadd field. In 2014, it acquired interests in three producing fields: Morvin (6%), Vilje (24.243%) and Vale (24.243%), as well as in the Gina Krog field (8%), which is currently in the development phase. In the other licence areas, the company is engaged in exploration projects.