HISTORY OF OIL AND GAS IN EUROPE
The European oil and gas industry literally began in the Republic of Poland in 1854 with the first oil well at Bóbrka Field, and then the first refinery, all in the Carpathians of southern Poland. The area is heavily oil saturated, with most production from less than 500 meters. Surface oil seeps are plentiful. An active oil recharge system dominates as oil and gas migrates from interbedded and high quality source beds, with up to 16% TOC.
The modern oil and gas industry actually began in the Carpathians, with the first well in the world at Bóbrka Field in Poland in 1854, followed by the first refinery there in 1857. However, the history of oil in the Polish Carpathians actually started at the 15th century. Polish knight and king’s writer Jan Dżugosz describes Erazm Syxt (1617), Wojciech Tylkowski (1695), Gabriel Rączyński (1721), Krzysztof Kluk (1781), and Stanisław Radowski (1783) as scientists in Poland who did work on the implementation of oil for the pharmacy industry. The first Petroleum Geology lectures were held by Professor Józef Ignacy Martinovics (1755-1795) in Lwów City (then southeastern Poland, now Ukraine). The research of Ludwik Zejszner, Alojzy Alth and Roman Gostkowski in the early 19th Century gave Ignacy Łukasiewicz the ideas that he ultimately used for the first distillation of oil near Krosno, Poland.
Europe is the third largest producer of oil in the world (by region) behind the Middle East and, only recently, North America. European oil sales are based on Brent pricing. Click on the map at left to visit a site showing the way the EU has changed over the years, with links to important demographics.
The Carpathian geological system is one of the world’s largest under-explored and under-developed oil and gas producing areas. The system has produced more than 6.8 billion BO (984 million m3 of oil) and 53.7 BCFG (1,522 billion m3 of natural gas) from fields in southern Poland, southeastern Czech Republic, Slovakia, western Ukraine, Romania and Austria. However, it has only recently begun to be the focus of modern exploration and production techniques and technologies because of its long political upheavals since 1914 (WW1).
Exploration and development of oil and gas resources in the Carpathians of Poland was feverish in the last half of the 1800’s and early 1900’s, using cable tool and primitive Canadian rotary equipment. Many of the “oilmen” were of North American origin. Although producing fields continued to be exploited, exploration activities were largely suspended during WWI (1914 to 1918). During the relatively peaceful years between the World Wars, there was some renewed activity. However, things changed dramatically after Hitler’s attacks in 1939. After 6 years of destruction under the Nazi’s, the country was then plunged into 44 years of Soviet domination. Fiercely patriotic, the Poles hid or destroyed much of their oil and gas information during that period, so only very limited and largely unsuccessful oil and gas exploration was conducted.
Bóbrka, the first oil field.
The original wells were dug by hand, using boards and ropes with buckets for digging and stabilizing the hole. This was a very dirty and dangerous job, especially when oil and gas were encountered!
In 1989, largely due to pressure from the Poles, the Soviet occupation was ended in eastern Europe and “the wall” came down. Oil and gas rights for all promising areas were immediately put into a state oil company called Polskie Górnictwo Naftowe i Gazownictwo SA (“PGNiG”) a/k/a the Polish Oil and Gas Company. PGNiG has since had only a handful of successes in Poland. They have drilled an average of less than 10 wells per year in this Carpathians area (4.7 Million acres), looking mostly for deep targets (>3,000 meters). Of the historical 76 oilfields (25 of which are still producing) and 147 gas fields in the area, almost all were discovered and in production by 1935, at depths of 500m or less. Much of the associated natural gas was flared and unmeasured.
Because members of the Discovery team have been working this area since 2007, Discovery is in a prime position to select the most lucrative projects, and to achieve the best governmental cooperation and support. Since the government owns all oil and gas rights, handles all concession awards and regulates all operations, those relationships are critical to success.
Although Europe has generally higher costs (by 20% or more), Discovery is working diligently to improve efficiencies, lower costs and develop highly profitable oil and gas production opportunities. Poland and Slovakia import about 95% of their oil needs, and 65% to 90%, respectively, of their gas needs. Brent oil pricing (see details above) and a gas price 3X that of the U.S., with a population eager and motivated to be free from Russian supply controls, only serves to improve an already promising market situation.
Shallow oil wells in the Polish Carpathians
The core archive at Hołowno, Poland
A shallow drilling rig stationed in Poland
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