Since 2010 the mood in the Polish shale gas sector has deteriorated from early enthusiasm to utter pessimism. The government now intends to reinvigorate the sector with a new set of sector-friendly regulations (for further details please see "Polish shale gas (r)evolution to be reinvigorated"). In mid-September 2014 the Ministry of the State Treasury announced a draft act which would set out particular rules for the preparation and realisation of investments concerning prospecting, exploration, exploitation and transportation of hydrocarbons.
The main aim of the draft Hydrocarbons Investment Act is to expedite the realisation of such investments by accelerating and simplifying the administrative procedures relating to prospecting, exploration, exploitation and transportation.
One of the main features of the act is the limited application of zoning regulations to prospecting, exploration, exploitation and transportation of hydrocarbons. In particular, if hydrocarbon investments are not foreseen under local zoning plans, they can be realised under individual zoning (investment) decisions.
The act also introduces accelerated procedures for the issuance of decisions concerning hydrocarbon prospecting, exploration, exploitation and transportation, such as environmental permits regarding investment, decisions on the exclusion of real estate from agricultural or forest activities and water permits.
According to the act:
- environmental permits regarding investment will be issued within 45 days of application;
- decisions on the exclusion of real estate from agricultural or forest activities will be issued within 14 days of receipt of the relevant application; and
- water permits will be issued within 30 days of receipt of the relevant application.
If these timeframes are not observed, the relevant authorities will be subject to penalties amounting to approximately PLN1,000 (€240) for each day of delay.
Additionally, the timeframes for issuance of building permits and use permits regarding hydrocarbon prospecting, exploration, exploitation and transportation have been shortened:
- to 30 days with respect to building permits; and
- 21 days with respect to use permits.
The act also includes for separate provisions on securing real estate for prospecting and exploration purposes. Such procedures concern:
- public roads and railways;
- third-party real estate; and
- real estate of unregulated legal status.
If the investor cannot obtain an agreement or consent for the use of real estate, a voivode (public administration office) will be obliged to issue a decision allowing for such use.
Commencement of the hydrocarbon production phase will be subject to an 'investment decision'. The Provisions of zoning regulations will not apply (eg, on the adoption of local zoning plans). Therefore, it seems that procedures in this respect will also be shortened, as in practical terms the adoption of local zoning plans may take 12 months or longer.
The act also shortens appellate procedures regarding decisions issued in relation to the activities covered in this act:
- Decisions will be subject to immediate enforcement; and
- The term for appealing a decision will be shortened from 14 days to seven from its delivery (or to 14 days from its public announcement).
Court appeal procedures are also expected to be shortened.
According to the Ministry of the State Treasury, these changes should reduce the preparatory stage before the commencement of exploration drillings from between seven and 12 months to three.
The act is subject to public consultation and inter-governmental and parliamentary works.
It remains to be seen whether it will result in evolution, revolution and reinvigoration of the Polish shale gas sector.
For further information on this topic please contact Adam Kozlowski at Norton Rose Piotr Strawa and Partners LP by telephone (+48 22 581 4900), fax (+48 22 581 4950) or email (firstname.lastname@example.org). The Norton Rose Fulbright website can be accessed atwww.nortonrosefulbright.com.
This article was first published by the International Law Office, a premium online legal update service for major companies and law firms worldwide. Register for a free subscription.