# Presentation: 050217

## POLAND  Old Energy, New Energy, Cleaner Energy 

## Market Characteristics

- Industry remains mainly state-owned or controlled
- Government views it as a strategic sector
- Poland is a net importer of oil and natural gas
-      -   depends mainly on supplies from Russia
-      -   political & national security issue

## Market Characteristics

-  Actively seeking to diversify supplies
- Electric Power Sector restructuring and privatizing
-     -  overwhelmingly coal-fired power plants
- No nuclear power yet
- Extensive biomass, hydropower, wind and geothermal resources
- Only 3% of energy from renewables; mandated target 10%--2010

## Oil & Gas Reserves and Production 

-  Limited, domestic production serves fraction of its needs
- Oil reserves estimated at 2.5 billion barrels
-    - annual crude oil   production of
-      4.2 million barrels

## Oil & Gas Reserves and Production

-  Natural gas reserves estimate at     1.2 trillion M3
-    -  annual production of around  4        billion M3
- Seven major refineries annually     process 60 million barrels
- Total consumption of oil products at 450,000 b/d

## Oil & Gas Exploration –  onshore and offshore 

- 1994 law established favorable legal/financial framework
- Ministry of Environment issues licenses
- Concessions available for up to 6 years
- No limit on number of concessions for single company

## Oil & Gas Exploration –  onshore and offshore

- Small U.S. company actively exploring, developing, producing
- International major actively investigating natural gas
- Coal-bed methane, significant opportunities
-    -  Poland has Europe’s largest coal reserves
-    -  Private estimates 1/3 reserves have      extractable methane
-    -  Small U.S. company actively investigating

## U.S. – Poland Energy Industry Roundtable 

- Polish Government initiative to attract U.S. industry
- Follow on event planned later this year in Warsaw
- Keen interest in partnering with U.S. firms in 3rd countries
-    -  Central Asia and Middle East

## U.S. – Poland Energy Industry Roundtable 

- Odessa-Brody oil pipeline extension – need private companies
- LNG and natural gas pipeline imports – strategic priority
- -  plan to build LNG port facilities on Baltic
-    -  want natural gas pipeline from Norway

## Coal Industry 

- Poland has Europe’s largest coal reserves, hard and lignite
- Industry continues to restructure, downsize, unions struggling
- Still has lowest production costs in Europe
- Mostly used for electric power, heat and industry

## Coal Industry 

- Well established base
-    -  scientific and research mining      organizations
-    -  produces full range of machinery
-    -  many coal mining servicing companies
- Significant clean coal technology opportunities
- September 2007 – Renewable Energy Trade Mission, Clean Coal

## Electric Power - Restructuring

- Mainly state-owner, long-term power supply contracts, coal-fired
- Industrial users subsidize households
- 1997 Energy Law, reform and liberalize
- Break up vertically integrated monopolies
- Create separate generation, transmission and distribution cos.

## Electric Power – Restructuring 

- Allow Third Party Access
- Independent regulator – URE
- Consolidate into economically viable firms and privatize
- Reform is moving forward slowly

## Electric Power – Strategic Partners

- One major conglomerate, BOT, wants U.S. strategic partner
- Expect other firms also open (French and Germans active)
- Favorably disposed to U.S. products/technology

## Electric Power – Equipment Needs

- Extensive modernization, for EP & CHP, $15 billion by 2010
- Environmental clean up, desulphurization alone, $9 billion

## Electric Power–Best Prospects

-   coal-fired fluidized bed combustors
-   pollution control equipment
-   pumps and compressors
-   electrical systems
-   heat recovery systems
-   turbines and generators
-   gas and steam turbines
-   cogeneration equipment

## Electricity Trading Services

- 1997 Energy Law created legal framework
-   -  would allow wholesale and retail   sales
- Currently buy from grid at wholesale, regulated prices
- Eventually contracts and market will determine prices

## Electricity Trading Services

- Market players will be free to perform trade transactions
- Service providers need to be here, directly or with partners
- New energy exchange services needed
-    -  risk management, credit verification,  contract notice

## Nuclear Power

- Currently no nuclear power plants
- Poland wants to build in the next 10 years
- Already partnering with rebuild of Ignalina plant in Lithuania

## Renewable Energy

- Only 3% of energy is from renewables
- Mandated target is 10% by 2010

## Renewable – Best Prospects

- wood-fired boilers
- fluidized-bed boilers
- straw-fired boilers
- solar water thermal collectors
- geothermal heat pumps
- biogas spark ignition engines for electricity
- photovoltaic cells
- wind turbines
- hydro-power plant turbines

## Announcement

- Renewable and Alternative Energy Trade Mission
- Hungary, Slovakia, Czech Republic and Poland
- September 10-20, 2007

## U.S Commercial Service        U.S. Embassy             Poland

-  Market information and counseling
-  Trade contact/matchmakingservices
-  Advocacy
-         www.BuyUSA.gov/Poland