© Reuters / Kacper PempelA drilling rig is seen at sunset at Grabowiec 6 near the village of Lesniowice, southeast Poland
The Polish government said it will offer 6-year tax breaks for shale gas companies in an effort to fast track investment and exploration. The announcement comes as energy tension with Russia run high over Ukraine.
The new tax break is aimed at helping Poland attract foreign companies to explore and invest in the country's shale oil reserves, believed to be the largest in Europe, according to data by the US Energy Information Administration.
The tax break will be
"a huge incentive" to get investors interested and on the ground, Prime Minister Donald Tusk said on Tuesday, adding that by 2020 taxes
"shouldn't exceed 40 percent of extraction income."Between 2020-2029, the new incentives will contribute up to $5 billion in revenue, according to Tusk.
The proposal will be sent to parliament within two weeks, and the prime minister hopes it will pass without any hiccups.
Earlier in February, Poland ditched plans to use a state company to explore for shale gas, instead deciding to auction off licenses to foreign companies. Exxon Mobil and Marathon Oil are both interested in the country's shale industry. Some state-controlled companies have also won licenses for exploration.
Maciej Grabowski, Poland's environment minister, expects the country's first commercial shale gas well to be drilled this year, and hopes to have over 200 wells in the next few years. The country wants to become an exporter, and not an importer of natural gas.
Comment: Poland has done their bit to stoke the fires of war in Ukraine and if the gas will be turned off now during a "gas war", then will only have themselves to blame.
For more on fracking:
Doctors call on President Obama for more regulation on fracking
Study says fracking chemicals interfere with endocrine functions, linked to heightened risks of cancer, low fertility rates and decreased sperm quality
New study links fracking to birth defects in heavily drilled Colorado
Opposed to fracking? Then the corporatocracy considers you to be a terrorist
Europe to ditch climate protection goals - make way for fracking
Investigation confirms evils of fracking
EPA will let frackers keep on dumping chemicals into the sea