Oil and natural gas production in the Czech Republic – history and present

Although the Czech energy sector depends on imports of oil and natural gas from other countries around the world, these strategic commodities are also produced domestically, albeit on a small scale. However, domestic production can cover only a fraction of domestic demand, at most a few percentage points.

Czech natural gas production has been relatively stable over the past decade, while oil production has faced a declining trend. Any change is also hampered by the decline in prices of these commodities on global markets. Almost all production currently takes place in South Moravia, with a small share also in northern Moravia.

History of production in the Czech Republic

The origins of oil production and natural gas production in what are now the Czech and Slovak Republics date back more than 100 years. Jan Medlen proved to be a pioneer in the “production” and use of natural gas when, while digging a drainage ditch on his land in Gbely, now located on the Slovak side of the state border, he accidentally came across a natural gas deposit.

He piped the gas into his home, where he used it mainly for heating. The gas supply system was relatively primitive, which led to its accumulation and a subsequent explosion in 1913 that even came to the attention of the Austro-Hungarian authorities.

1914 – the birth of the Czech oil industry

The first exploratory wells were subsequently drilled and, in addition to natural gas, oil was surprisingly discovered as well. Production from the deposit began in 1914, which can therefore be considered the start of the oil industry in the country. Although production from this deposit would be insignificant by today’s standards, at the time it accounted for up to half of all production in Austria-Hungary.

The first commercial deposit in what is now the Czech Republic was discovered in 1919. The first exploratory well, more than 200 metres deep, was drilled in the area of the drained Nesyt pond, and production continued in this area until the 1960s.

Initially, only oil from shallower depths was produced and processed into kerosene oils.

The situation in the second half of the 20th century

During the Second World War, the Czech deposits of the time were of strategic importance to Nazi Germany. At the time, Deutsche Erdöl A. G., Germany’s most significant oil production company, operated more than 1,200 wells in the Hodonín area. Czechoslovak refineries even attracted the attention of Allied forces, particularly their bombers.

After the war, all existing wells and refineries were merged in 1946 under Czechoslovak Oil Works, headquartered in Hodonín. The company’s importance is also reflected in its size: in 1948, it employed as many as 1,858 people. At the beginning of 1969, with the establishment of the Czechoslovak Federation, the company was split into the separate Moravian Oil Mines and Slovak Oil Mines.

The revolution also brought an increase in oil production

Before the revolution, annual domestic oil production stood at around 50 thousand tonnes. It began to rise in 1991, with annual production reaching 64 thousand tonnes; production then grew steadily in the following years, peaking at 310 thousand tonnes in 2003.

Current oil production situation in the Czech Republic

Several dozen oil and natural gas deposits are registered in the Czech Republic, most of them concentrated in the Vienna Basin. The following map provides an overview of registered and already depleted deposits.

The number of producing oil deposits has remained more or less constant in recent years, but production itself has been gradually declining. In 2013, after 10 years, it even fell by half. Compared with global production, domestic output is negligible (just three thousandths of a percent).

The most important companies currently engaged in oil production in the Czech Republic are Hodonín-based MND a. s. (formerly Moravské naftové doly), the LAMA ENERGY GROUP and Ostrava-based UNIGEO a. s.

The following table also shows global oil production according to WBD (World Mining Data from the Austrian Federal Ministry of Science) and BP (the oil company formerly known as British Petroleum).

Oil imports to the Czech Republic

The Czech Republic depends on oil imports from other countries around the world. Domestic production in 2014 slightly exceeded two percent of total imports. Russia is the Czech Republic’s most significant oil supplier, accounting for roughly two-thirds of imported oil.

Current natural gas production situation in the Czech Republic

As with oil, most deposits are located in South Moravia; however, natural gas is also found in the Upper Silesian Basin in the form of sorbed deposits in coal seams.

The number of producing deposits fell slightly between 2009 and 2013, but production itself saw no significant change in volume and stood at around 200 million m³ per year. As with oil, domestic production does not even reach one percent of global output.

The companies engaged in natural gas production in the Czech Republic are the same as those producing oil. They also include Green Gas DPB, a. s., which produces mine gas from closed mines in the Ostrava-Karviná region and purchases surplus gas from mining companies operating in mines that remain active.

The following table also shows global natural gas production according to WBD (World Mining Data from the Austrian Federal Ministry of Science), BP (the oil company formerly known as British Petroleum) and the IEA (International Energy Agency).

Natural gas imports to the Czech Republic

Almost all of the Czech Republic’s natural gas needs must be met through imports. Domestic production accounts for only one to two percent of imported volumes. The following table shows that in 2012 and 2013, almost all imported gas came from the Russian Federation. In 2014, natural gas imports from Norway rose significantly.

As a result of the 2021-2023 energy crisis, which saw an extreme increase in natural gas prices on European exchanges and, closely following that, higher prices for end consumers, natural gas imports from the Russian Federation came to a virtual halt. Imports from the Russian Federation were primarily replaced by imports of liquefied gas from the United States and Qatar.