What goes on in Poland on the 9th of February.
The EC approved state aid for Polish mines
The European Commission informed on Thursday that it has approved a PLN 5 billion program for supporting mines being shut down in Poland. The EC considered that potential distortions of competition as a result of state aid would be limited.
No sooner than 2016, the European Commission accepted the Polish restructuring program for mining, assuming expenditure for its restructuring until the end of 2018 – mainly social protection for miners and liquidation of assets – nearly PLN 8 billion.
Since the possibility of state aid for taking over post-mining areas for revitalization from entrepreneurs will end on 31 December 2018, Poland applied to the EC for notification of PLN 5 billion of further aid for restructuring the mining industry in 2019-2023 to close the transformation process.
Statoil surprised with the profitability of the deposits. Good news for Baltic Pipe
Norwegian oil production can overshadow the American shale revolution in terms of efficiency. Statoil reports that at the first production phase from the Johan Sverdrup field, the profitability limit for mining fell below $ 15 a barrel. This is good news for PGNiG and Lotos with shares in the concessions there, and perhaps for the Baltic Pipe project.
This limit for the entire deposit is below $ 20 a barrel. This means that at such a price of oil on the market it is profitable to extract oil from this field. The extraction is to start in 2019 and reach 440 thousand barrels a day. The costs of the first phase dropped by 30 percent. The estimate of deposits from 1.7-3.0 billion oil equivalent has also increased to 2.1-3.1 billion.
Meanwhile, according to the Rystad agency, the American limit of profitability is about $ 40 a barrel, according to BiznesAlert.pl, in some areas of the Permian region it may be $ 37. However, even such a limit guarantees an increase in production under current conditions, when oil costs about 70 dollars.