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Dáil Debate on Sinn Féin motion to review Ireland's oil and gas contracts - Part 1

Deputy Martin Ferris: I move:


That Dáil Éireann:


conscious of the declaration in the Democratic Programme that ‘the Nation’s sovereignty extends not only to all men and women of the Nation, but to all its material possessions, the Nation’s soil and all its resources, all the wealth and all the wealth-producing processes within the Nation’; and


in view of the vast untapped potential that exists off our shores in oil and gas reserves, estimated by the Department of Communications, Marine and Natural Resources in 2006 to be ten billion barrels oil equivalent, which at current prices amounts to a potential value of around €700 billion;


calls for:


-- a complete review of licensing and revenue terms and the immediate revoking of the consents given to the Corrib consortium and the licence for Lough Allen pending such a review;


-- the establishment of a State oil, gas and mineral exploration company that would hold a 51% majority share in all oil and gas finds and would have its own research facility in order to collect full and up to date information on reserves;


-- the imposition of a 50% tax on oil and gas profits; and


-- a 7.5% royalty;


and that the revenues that would accrue from this would provide towards the resources for long term and sustainable growth in place of the current indenture to the EU and IMF because of the unsustainable bank debt.


May I share time with my colleagues, Deputies Adams, Ó Snodaigh, Ellis and Crowe?


An Leas-Cheann Comhairle: How many minutes will Deputy Ferris take?


Deputy Martin Ferris: Ten.


An Leas-Cheann Comhairle:   Is that agreed? Agreed.


Deputy Martin Ferris:  In reply to a priority question of mine on 5 April, the Minister for Communications, Energy and Natural Resources, Deputy Rabbitte, stated the Irish offshore is relatively unexplored. While it would be true to say it is relatively underdeveloped, it is not quite accurate to use the word “unexplored”, in that we have a fair idea of what lies off our coast. The generally accepted estimate is the one we cite in the motion and that came from the Minister’s own Department of Communications, Marine and Natural Resources, as it was then, in 2006. According to the estimate, there were approximately 10 billion barrels of oil equivalent off our western coast, composed of 6.5 billion barrels of oil and 20 trillion cu. ft. of gas. At current oil prices, this equates to a value of approximately €700 billion.


While it is true that the actual amount of oil and gas brought ashore has been small, those reserves exist. Not only this, but the international companies have been active in acquiring licences for the areas in which the reserves are to be found. While there are undoubted difficulties and high costs involved in bringing the oil and gas on shore, one thing is certain, namely, in a world where finite energy supplies are an ever more central concern, the oil and gas off our shores will become increasingly important and valuable and, therefore, there will be a significant incentive to ensure they are brought on stream.


For this reason, the issues and proposals contained in our motion are important. The Minister may attempt to dismiss in an off handed manner, as he has done recently, the policy of Sinn Féin and others, a policy to which his former party, Sinn Féin The Workers’ Party, was strongly committed, by stating that a 25% or 55% share of nothing is still nothing, but we are not discussing nothing. Indeed, some of that “nothing” from the Corrib field will be brought ashore in the not too distant future. The key issue is how it is utilised to the best benefit of the Irish people.


Nor are the proposals we are making exclusive to the parties of the left. This is what the three parties that defend the current taxation and licensing scheme, one of which claims to be on the left itself for sentimental reasons, would like people to believe. According to a recent article in The Irish Times by Ronan McGreevy, having the quantity of oil and gas that is estimated to lie off our shores is “a bit like a man whose home is about to be repossessed who cannot find his winning lottery ticket down the back of the sofa”. It is there, but how do we cash it in? He was obviously making that comparison with the current situation, whereby the State has committed to a vast and unpayable debt consequent on bailing out the banks and the bondholders and submitting to an IMF-EU drafted austerity programme. This comparison is relevant, given that the Minister and others claim the State could not afford what would be a significant capital investment in oil and gas exploration and, in the next breath, justify the pouring of God only knows how many billions of euro into the black hole of the bank debt.


If the State were to take a more proactive role in oil and gas exploration, we would need to invest money, but it would pay a considerable dividend once the oil and gas came on stream. It is a choice between mortgaging the State for decades on behalf of private unproductive interests and investing in something we know would pay a handsome reward. Having a proper State stake in oil and gas finds and imposing the sort of tax and royalties that we propose would provide us with the same sort of bonanza that has accrued to other states where the state has refused to provide the generous terms which this State does to the multinational companies. Contrary to the myth being spread in the House, states that have imposed such terms are not necessarily radical or even on the left, nor is a proper tax rate a disincentive. If the companies are happy to pay a tax rate of 78% in Norway and an average international rate of 68%, surely they would be happy to pay a tax rate of 50% here and to concede the State share.


Professor Ray Kinsella of the Smurfit Graduate Business School also referred to our natural resources in a piece he wrote for the Irish Examiner on Monday. He made the point that the State is almost completely constrained by the terms of the IMF-EU programme. The Minister himself referred to it as a straitjacket prior to the election when he was obviously preparing the ground for what he knew would be his party’s acceptance of the basic parameters of that deal. It is a straitjacket, but it is one that we are not forced to keep on like the inmates of some institution for the deluded. We can if we wish throw it off and Professor Kinsella proposes we do so.


The real issue facing us is whether we as a people and we as the representatives chosen by the people have the courage and vision to embark on an alternative path to the disastrous one we have set out on as a consequence of bailing out the banks and accepting the dubious favours of the EU and the IMF. According to Professor Kinsella, fundamental to this would be our having a credible set of initiatives to maximise the use of all our natural resources. He was not referring specifically or exclusively to our oil and gas, but they would be a key part.


This is the aim of our motion. In it, we set out the vision that my party and many others have of how our oil and gas resources - it could be expanded to include our fisheries, forestry and wind and wave energy - ought to be used to bring about a revival of enterprise and spirit among our people. This is our alternative to the politics and pessimism of austerity. We included the words of the Democratic Programme, which are actually a quotation from Padraig Pearse, to remind the House of the founding vision of the Republic. It is a vision that we need to bring to the fore again.


I also noted in the Minister’s reply to me two weeks ago that he quoted from a 2007 departmental review conducted by his current Department. This is slightly ironic and even a bit disturbing, as it indicates that, within a short time of taking office, the Minister has shown himself to be willing to adopt the same stance on this matter as his Green Party and Fianna Fáil predecessors. This stance is different from that taken by the late Justin Keating when he was the Labour Party Minister with responsibility for this area in the mid-1970s. It also contrasts with the commitment given in the Labour Party’s election manifesto to extend the current royalty regime to the Corrib consortium as part of a promised review of the terms and conditions governing oil and gas exploration. In his 5 April reply, the Minister stated he would “keep the licensing terms, both fiscal and non-fiscal, under review”, but he did not indicate when the promised review would take place. Basing his reply on the 2007 review and the general tenor of his remarks indicate that no review will take place in the spirit in which the manifesto commitment was intended.


I referred to the resources protection campaign in which the Minister’s former party, Sinn Féin The Workers’ Party, was involved in the 1970s. I did not do so in any attempt to embarrass him, but rather to point out that much of what the party stated regarding mineral, oil and gas resources was spot on. My party and others were making similar statements at the time. Interestingly, a 1975 pamphlet published by the resources protection campaign, which the Minister would know well, referred to the fact that the excuse given for the generous terms afforded to Marathon Oil, for example, was that the incentives would ensure the State would experience an oil and gas boom similar to the one occurring in the North Sea at the time. Almost 40 years later, we are still being told it is necessary to be charitable to indigent companies like Shell. The fact is that, apart from the generous taxation terms and the write-offs provided, the licences allow the companies to sit on their claims for long periods before commencing operations. In conjunction with the fact that we do not even know what the companies have discovered in the process of exploratory drilling, most of the oil and gas off our coast forms part of the companies’ long-term reserves, which they will bring on stream when they believe market conditions are right. While this may be in the best interests of the companies concerned, it is certainly not in the best interests of the State and its citizens. As the Corrib project illustrates, when the gas comes on shore, Bord Gáis, assuming it has not been broken up and sold off by then, will need to buy the gas back at whatever is the market rate.


Deputy Gerry Adams:   This Sunday, Irish people will be remembering with pride and celebrating the 1916 Easter Rising. Beidh comóraidh agus cuimhneacháin ag ár bpáirtí, Sinn Féin, timpeall na hÉireann. Beimid ag ceiliúradh ní hamhaín na fir agus na mná a fuair bás ag an uair stairiúil sin, ach freisin an Phoblacht agus Forógra na Poblachta i 1916.The Proclamation asserts “We declare the right of the people of Ireland to the ownership of Ireland, and to the unfettered control of Irish destinies, to be sovereign and indefeasible.” Several years later, the programme of the First Dáil gave expression to that statement when it declared that the nation’s sovereignty extends not only to all the men and women of the nation but to all its material possessions, the nation’s soil and all its resources.


Is trua nach bhfuil an aidhm seo bainte amach ar mhaithe na ndaoine agus go bhfuil gnóthaí dona déanta ag Rialtais éagsúla ó shin. During the past two decades in particular there have been few more disgraceful examples of the corrupt relationship between business, the golden circle and the political system than the manner in which a small group of politicians have given away our natural resources to multinationals. The €80 billion EU and IMF bailout is dwarfed by the enormous value of this State’s potential oil and gas reserves, as well as base metals and fisheries.


In 2006 the Department of Communications, Energy and Natural Resources estimated that the amount of gas and oil off Ireland’s west coast is the equivalent of a potential 10 billion barrels of oil. This is worth, at today’s price, up to €700 billion. In addition, a failure to invest in developing sustainable energies and forestry and protecting our fishing rights has denied the State valuable sources of employment and much-needed revenue. Decades of mismanagement and dishonest decisions by successive Governments have resulted in a handover of our natural resources to multinational companies with little benefit to the Irish people.


It was a Fianna Fáil Minister, former Deputy Ray Burke, who introduced new licensing terms in 1987 and abolished royalties and State participation in the exploration of our oil and gas reserves. Companies were given 100% tax write-offs for exploration and development costs. Perhaps that is a subject for investigation. This was reinforced five years later when the then Finance Minister, former Deputy Bertie Ahern, reduced corporation tax on oil profits to 25% and new licensing terms which were beneficial to the multinationals.


In addition, the eagerness with which the State has acquiesced to the demands of the oil companies is exemplified in its attitude to the people of Rossport and north Mayo. There have been heavy-handed tactics by the Garda and Shell employees against people protesting in defence of their homes and land. Local people have been arrested and imprisoned, and there is the recent example of two young women arrested, with allegations of improper behaviour by several gardaí. That incident must be thoroughly investigated, as should the policing strategy and tactics being employed by An Garda Síochána. The operation of policing the site has cost the State more than €20 million. Ar lá an toghcháin, shínigh an tAire Fianna Fáil, Pat Carey, an socrú deiridh maidir le líne píopa na Coiribe. Rinne Aire Fine Gael, Phil Hogan, an rud céanna tamall ó shin.


The exploitation of the Corrib gas field also illustrates the failure of Government to have a sensible partnership agreement with the exploration company which looks after the interests of citizens. Corrib will bring little or no benefit either to the local community or to the Irish people. In addition and to add insult to injury, the harvested gas will be sold to Bord Gáis at the market rate; having given it all away and made large profits for the companies, we must buy back the gas at the market rate.


Let nobody seeking to defend the current status quo claim that any change to the existing financial arrangements would scare off the multinationals. There are a number of governments around the world, including Russia and most recently Egypt, which have rewritten agreements with the oil companies to take a greater share of the profits and the multinationals have not walked away. It is not too late to challenge the bad practice and decisions of the past. This Government, on behalf of citizens, should now move to acquire a majority State shareholding in our oil and gas. It should introduce an effective and just taxation and royalty regime which ensures that this State can have the financial resources to get rid of the State debt and regain our economic sovereignty by ending the involvement of the EU, IMF and ECB in our affairs.


Is í an tír seo an t-aon tír ar domhain a d’aimsigh gás as a gcósta is a thug é in aisce. A sensible exploitation strategy would also provide the funding necessary to create jobs and build a first-class public service infrastructure fit for purpose for the 21st century. The Sinn Féin motion recognises this and I appeal to every Deputy in this House to set aside party political allegiances, recognise that the Sinn Féin motion is seeking a better deal for the Irish people and to support it. The Government should move on it. Fine Gael is by its nature a conservative party but Labour, even in a previous manifestation as the Workers’ Party, was right on the issue at that stage. It should not be wrong now.


Deputy Aengus Ó Snodaigh:  The 2011 budget disproportionately targeted families on low incomes and in receipt of social welfare. The previous Government stated in this House to the Irish people that there was no alternative but to introduce the savage cuts and tax measures of that budget. When the current Government came along its mantra was that there was no alternative but to continue with these savage cuts. There is definitely an alternative and it is outlined in our motion.


We have long demanded that Irish Governments use our natural resources for the public good. We made that call in 1919 in the democratic programme of an Chéad Dáil, and we are making that call again today at a time when our nation’s sovereignty is no less in jeopardy. In 1919 the British Crown was trying to wrestle the regained sovereignty from the risen people. In the democratic programme of an Chéad Dáil, Sinn Féin declared, on behalf of the Irish people, that it is our duty to exploit Ireland’s mineral deposits in the interests and for the benefit of the Irish people. The vote on this motion will expose who has remained true to that basic principle, which is the promise to put Ireland’s needs first.


Alongside the Government’s duty to exploit our natural resources for our benefit, the 1919 democratic programme also declared that it was the Government’s first duty to make provision for the physical, mental and spiritual well-being of the children and see that no child should suffer hunger or cold from lack of food, clothing or shelter, with all of these provided with the means and facilities requisite for the proper education and training as citizens of a free and Gaelic Ireland. If the Government fails to harness the wealth of Ireland’s natural resources, it cannot fulfil its first duty to Ireland’s children.


Almost 100,000 children are living in consistent poverty in the State, with the figure growing by almost 30,000 per year. These children are in families living on incomes below the poverty line, leading to experience of material deprivation. That means children are quite often hungry and cold. Ending child poverty will require immediate and long-term investment for family income supports and in quality public services. Indebting ourselves to the EU and IMF means we can wave goodbye to any prospect of spending required to end child poverty in this State. We simply cannot afford to hand over any valuable natural resources or assets along with all the taxes paid by workers to finance multinational corporations, banks, bondholders or the IMF and ECB.


There is an alternative and we cannot afford the mechanism upon which this and the previous Government have embarked in indebting our country. The Government will continue to fail in its duty to provide for the income, housing, health and educational needs of these children if it does not reverse the odious and treacherous deal which will see multinational corporations rob the Irish people of natural resources which are rightly ours.


The deals entered into by previous Governments and endorsed recently by this Government amount to economic treason. That Ireland will have to buy back its own oil and gas at market cost is economic treason. That little or no revenue will accrue from the extraction and sale of Ireland’s gas and oil is economic treason. That the Norwegian people will get more benefit from these natural resources than Ireland will is economic treason. That Ireland, under the current arrangement, will receive just 3.6% of the value of the Corrib field is economic treason. That this Government would forego the billions of euro that could potentially be raised from these resources, and thus let Ireland’s children go poor, is economic treason. I urge the Minister, even at this late stage, to support our motion and withdraw the craven amendment tabled by the Government.


Deputy Jonathan O’Brien:   Apart from the economic issues, which have been dealt with by Deputies Adams and Ferris, the Corrib project has proven to be highly controversial with widespread opposition to the pipeline in Mayo. Apart from safety and the environmental concerns, many of those involved in the protest have based their opposition on the fact that as things stand, the Irish people will gain little from the gas coming onshore. The reaction of the consortium and the State to the campaign also leaves much to be desired. It has been heavy-handed, to say the least. We saw more evidence of this recently, with allegations that certain members of the Garda had joked about rape of two female protesters. In 2005 we had the disgraceful jailing of five men from Rossport after Shell took an injunction preventing them from engaging in legitimate protests at the site of the pipeline as it was then proposed.


Since then, Shell has made some alterations to the route - which it claimed at the time it could not and would not do - but many in the local community remain strongly opposed to the pipeline, for which consent was given on the day of the election by the former Minister for Community, Equality and Gaeltacht Affairs, Deputy Pat Carey. Although both Fine Gael and Labour protested at the manner in which this consent was given, the Government has done little to overturn it. In fact, it has stood by the decision. The lack of action or urgency on behalf of the Government has done nothing to reassure those who, locally and nationally, are still opposed to the project and will continue with their campaign of opposition.


I referred earlier to the policing of the protests in Mayo, which has raised some serious issues. On the State side, we have the example of some members of the Garda acting in a hostile manner towards protesters. This is not to mention the conservative estimate of the cost of all of this policing, which runs to more than €20 million. Protesters have been harassed, followed and searched, and there was the recent allegation to which I referred earlier. This is not the only time such an allegation has surfaced. A local woman has alleged that she was subject to similar abuse on another occasion. According to numerous reports, sexual intimidation is quite common in that area. Apart from the Garda, there are also private security operatives who seem to act with impunity. Shell’s own security company, IRMS, has been involved in a number of incidents, including physical assaults, intimidation and the photographing of children. Its members have also been accused of taking photographs of people through the windows and doors of their own homes.


All of this action is designed to intimidate local residents and protesters. As the recent film “The Pipe” has shown, many local people feel they are in a community living under siege. The calibre of those involved in providing security has also been called into question. One person who worked for the company at Glengad later turned up in Bolivia, where he had dealings with members of a fascist group that was allegedly planning to kill President Morales. There was also the case of the undercover British policeman Mark Kennedy, who spent several days at Rossport in 2006. Kennedy’s task was to infiltrate anti-globalisation and environmental groups but we have yet to receive a report on what exactly he was doing in this country, on whose behalf he was working, and whether the Garda was aware that he was here.


With regard to the wider legal issues connected to Corrib and the oil and gas sector generally, there are grounds for a full investigation of issues including the granting of licenses, the changes to the revenue terms and the transfer of State forestry lands at Bellanaboy to the consortium for the construction of a refinery. As was said at the time of the publication of the Flood tribunal report containing evidence related to Ray Burke which led to his being jailed on corruption charges, the terms of reference of that report should have been extended. Ray Burke was the Minister responsible for giving away the State’s share of oil and gas funds. We know that he met privately with oil company executives against the advice of senior officials in his Department. Given what we also know about his activities with regard to planning, a full investigation should be made into his role in all of this.


In light of all the information we now know, there is a case to be made, as we propose in the motion, for a full review of the granting of all licenses, and consent for Corrib and other projects should be revoked pending the outcome of such a review. This would not be unheard of; the Russian Government did exactly what we are proposing in 2007, when it re-established a majority state holding in several projects, including one involving Shell, because of environmental violations and suspicions about the manner in which licenses were granted and operated. The only review approaching the type we consider is required was one carried out by the Centre for Public Inquiry. The CPI then became the centre of a politically motivated controversy and was forced to cease its operations. Perhaps this was a coincidence but even so, there can be no doubt but that its intention to investigate other murky areas of Irish public life was not welcomed with open arms by members of the political and economic elite.


The report on Corrib makes for interesting reading. Among its key findings, it concluded that the pipeline as proposed carried a high risk of failure and that the quantified risk assessment on the basis of which planning approval was granted was inappropriate to the type of pipeline proposed. The report also outlines the unhealthy and unusual access that company officials had to those in power, and the timeline demonstrates how crucial favourable decisions often followed quickly after meetings with relevant Ministers. This all took place during the era of the Galway tent, and the fact that Enterprise Oil was a regular attendee and facilitator will not, I am sure, be lost on anyone in the House. Kevin Moore of An Bord Pleanála recommended the rejection of the project on environmental and safety grounds. His advice was, of course, ignored. The subsequent decision by An Bord Pleanála followed a meeting between members of the board and leading oil company officials from Shell, Statoil and Marathon. There was coincidence after coincidence.


Kevin Moore also questioned the sale of Bellanaboy Wood for the 400 acre refinery site. He pointed out that the consortium required such a single site under sole ownership and that this just happened to be one owned by the State forestry company, Coillte. Questions remain to be answered about how all of this came about. Legislative steps were then taken to ensure that a private company could build on privately owned land. All of this took place even before the application for planning permission had been submitted. There are many other items of interest in the report and I recommend all Deputies to read it. It also provides a good model for the type of review we propose in our motion.


I referred to President Morales of Bolivia. He nationalised Bolivia’s mineral resources on the basis of a referendum held in 2004 on a proposal to take control over those resources. Perhaps that is something this Government should consider to embody constitutionally what the authors of the Proclamation and the democratic programme of the first Dáil clearly intended, namely, to establish and guarantee the nation’s sovereignty over “all its material possessions, the Nation’s soil and all its resources, all the wealth and all the wealth-producing processes within the Nation”.


That was the vision of the Republic expressed by those we will honour next Sunday. It is a vision which every subsequent Government has failed to live up to but remains worth remembering, particularly at this time when our State’s sovereignty has been further undermined by the conditions attached to the bank bailout and the IMF-EU austerity programme. Such a constitutional change would also ensure that when pressure is applied, as it surely will be, for the sale of State companies, including the 7% of the land under the control of Coillte, we will have built-in protections.


I ask all Deputies to give consideration to this motion and I hope it will get the support of Deputies beyond my party. I ask the Government to withdraw its amendment. My party intends to follow this motion in Leinster House by proposing similar motions at local level at town, city and county councils of this State.


An Leas-Cheann Comhairle: Deputy Ellis has seven minutes.


Deputy Dessie Ellis:  Last February there was an energy action conference on fuel poverty. A speaker from Age Action noted that inability to pay for home heating might contribute to approximately 2,000 winter deaths in the State each year. Older people are more likely to be affected and are generally at higher risk of fuel poverty. Increasing numbers are falling into arrears on their utility bills and hundreds of thousands are entering into payment plans, many of which they still cannot afford. Disconnections are commonplace. Deaths from the cold, while rare, still happen. It is a scandal that a person could be allowed to die from cold in this day and age because he or she cannot afford to heat the home adequately.


The Government is happy to sell our natural offshore resources while it fails to seek revenue to help those in fuel poverty. Although the Commission for Energy Regulation announced that it is to maintain gas prices at current levels for residential and business customers until the end of September it is clear there will be increases after that date. Certain people have tried to justify increases, stating that Irish consumers pay less than the European average for gas. This argument does not stand up. Such people deliberately ignore the fact that we do not have a continental climate and therefore use more fuel. People cannot afford to pay more. People are being let go from work and are waiting months to receive the most minimal kind of redundancy payments. There are pay cuts and cuts in hours of work. There is the universal social charge, a review of which we still await. There is no need for it to be reviewed - it needs to be abolished.


The people cannot take any more. Ordinary working people are hurting because money goes to gas companies. It is a disgrace. Sinn Féin calls for our natural resources to be put in public ownership to realise profits for all the people, as per the democratic programme of an Chéad Dáil. We ask for this to be managed sustainably, in the public interest and for the benefit of future generations. We ask that an all-Ireland infrastructure be developed and the oil and gas sectors be nationalised to maximise non-tax public revenue generating potential.


If it had the political will, the Government could use natural resources to help revive and develop our economy. However, it does not and wishes simply to hand over what is ours to multinational companies. Contrary to popular belief, Ireland is rich in natural resources. Decades of Government mismanagement have resulted in a massive hand-over of resources such as natural gas, minerals and fisheries. In addition, a failure to invest in developing sustainable energies and forestry has denied the State valuable sources of employment and much needed revenue.


On the day he lost his seat and his party lost power the former Minister, Mr. Pat Carey of Fianna Fáil, issued an order for the last section of the Corrib gas pipeline. It was an act of disgraceful political cynicism. He had no political or moral authority to give the go ahead for a pipeline over which many concerns still exist even after changes were made following a ruling by An Bord Pleanála. The underhand manner in which this order was made proves that even in its dying days Fianna Fáil was doing favours for its friends at the Galway Races.


Having allowed this to continue Fine Gael and the Labour Party show themselves to be no different. The Corrib field will bring little or no economic benefit to our people under current revenue terms. We propose that the State take a majority share in all oil and gas reserves and impose proper taxation and royalties. The potential revenue stream from this measure would go a long way to addressing the current economic situation. Even in its dying days, Fianna Fáil was doing favours for speculators and its friends in big business. Questions remain to be asked about the conduct of the whole affair. Before the people of Dublin North West kicked him out of office, the former Minister, Mr. Pat Carey, maintained he had not signed the document on a whim and the entire process had taken eight months. However, the Green Party contradicted this when the former Minister, then Deputy, Eamon Ryan, stated he had not seen sight of the documents before he left office. Deputy Éamon Ó Cuív, who replaced the former Minister, Mr. John Gormley, was adamant the documents had not come to him. Perhaps this will be the subject of a tribunal further down the road. At the time this emerged, the then Labour Deputy, Mr. Michael D. Higgins, condemned the action and called for full transparency in respect of any communication between the Department and interested parties. I hope his party colleagues will heed this call.


Ownership and control of these resources should be returned to the people. Táár dtodhchaí i gceist. Tá meoin na ndaoine i gceist. Táár muintir agus ár dtír ag fulaingt gan ghá leis ar chor ar bith.


Minister for Communications, Energy and Natural Resources (Deputy Pat Rabbitte):  I move amendment No. 2:


To delete all words after Dáil Éireann and substitute the following:


“recognises that the true potential of Ireland’s indigenous petroleum resources can only be established through effective exploration and calls on the Government to continue to take measures to attract an increased share of mobile international exploration investment to Ireland by:


-- maintaining fiscal licensing terms that appropriately reflect the risks and rewards of investing in petroleum exploration in the Irish offshore and onshore, relative to investing in exploration in other competing jurisdictions; and


--offering appropriate licensing opportunities designed to attract new companies to Ireland, supported by an active promotion campaign underpinned by petroleum research projects; and




further recognises that, having regard to the fact that only four commercial discoveries of petroleum have been made in the Irish offshore since the 1970s and to the significant costs involved in exploring for oil and gas in the deep waters of the Irish Atlantic Margin, that the cost of such exploration should be borne at this time by industry and not by the taxpayer.”


With the permission of the House, I wish to share time with Deputy Healy Rae and the Minister of State at the Department of Communications, Energy and Natural Resources, Deputy O’Dowd.


An Leas-Cheann Comhairle:  Agreed.


Deputy Pat Rabbitte:  I welcome the opportunity for the House to hold an informed discussion on the question of the tax terms that apply to petroleum production in Ireland. The Private Members’ motion proposed by Sinn Féin, which is along the same lines of some earlier commentary in the House and in the media, clearly demonstrates the need for a well informed debate on this subject. Too often, public discussion of Ireland’s tax terms relating to the production of oil and gas is informed by a gross misunderstanding or, perhaps, a misrepresentation of the facts. In my contribution, I intend to focus on the facts and the realities. I will convey to the House the rationale underpinning Ireland’s fiscal terms for oil and gas production and I will demonstrate why Ireland’s existing terms are appropriate for now. I will present the facts which demonstrate why, from an exploration perspective, the Irish offshore should be differentiated from the offshore of the UK or Norway. I will address the developing myth that a simple change to Ireland’s tax policy in this area could be a panacea for all the challenges faced by our economy.


I wish to address the last point first. As I stated, there is a developing myth that Ireland has vast discoveries of oil and gas off our shores and that imposing a higher rate of tax on the production of these petroleum resources would eliminate all of our financial worries. Unfortunately, the reality is quite different. There is periodic publicity and not infrequent misrepresentation about a research finding from a study sponsored by my Department which estimated there could be in the order of ten billion barrels of oil equivalent in the Irish offshore. This is an estimate of the yet-to-find potential of the offshore frontier basins west of Ireland and is based on petroleum systems studies. It is an estimate of what might be present based on geological criteria and regional comparisons. Some commentators have chosen to represent this estimate in a manner that would suggest this volume of oil and gas had actually been discovered offshore Ireland. Clearly, this is not the case and it is misleading to suggest otherwise. To do so is to ignore the fact that this is simply an estimate of what may be out there but has yet to be found. It also ignores the fact that it would take hundreds or thousands of exploration wells to discover if the estimate is accurate. Also, it ignores the fact that even with an intensive and expensive exploration effort, the benefits that would accrue to Ireland would only be realised ten, 15, or 30 years from now.


The cost of drilling even 100 exploration wells in the Atlantic could be well in excess of €10 billion. Deputy Ferris argues for a more proactive role by the State but at €80 to €100 million spend per hole drilled I am unsure where the money could be found for that at this time.


Deputy Martin Ferris:  What about the money the Government put into the banks?


Deputy Pat Rabbitte:  Having regard to the high risk of unsuccessful exploration, it is difficult to make the case that the Irish taxpayer should invest billions of euro in an intensive exploration effort at this time. Instead, this should be left to the industry, which can include exploration in the Irish offshore as part of a balanced international exploration portfolio.


The rationale underpinning Ireland’s tax policy approach in the area of oil and gas production is simple. The oil industry is a global industry and Ireland competes not only with other European countries but with other regions of the world to attract exploration investment to Ireland. As a result, Ireland cannot set its tax terms in isolation or we would risk discouraging all potential investment.


Industry decisions on where to invest in exploration are principally driven by two key factors - geology and economics. Where the industry views an area as being highly prospective, it will be prepared to invest in exploration even if the tax terms are relatively tough. Of course, the opposite is also true. While the Irish offshore has recognised petroleum potential, it is rather under-explored when compared with other offshore areas such as Norway or the UK. The high level of successful exploration in the UK and Norwegian offshore areas has resulted in exploration companies being prepared to invest heavily in exploration in those countries, despite the fact that these states’ tax take, as previously stated, is much higher than in Ireland. For example, in excess of 1,200 exploration and appraisal wells have been drilled to date in Norway and in excess of 4,000 in the UK. This compares with a total of 156 in Ireland. When Deputy Adams states that the multinationals have not walked away, he is correct. When the prospects are high, they have not walked away. However, they have long since drastically limited their involvement in our waters, which can be rather turbulent, as no one knows better than Deputy Ferris.


The statistics are more dramatic when it comes to producing fields. The UK has in excess of 300 producing fields and Ireland has only three with a fourth in development. The number of wells drilled or the number of producing fields do not tell the full story since the size of producing fields can vary significantly. For example, the giant Troll field offshore Norway is in the region of 50 times the size of the Corrib gas field. The bottom line is that if Ireland’s petroleum tax terms were fixed at the same level as those of the UK or Norway, then we could expect no exploration investment would locate in Ireland. That would mean no new exploration wells and no new oil or gas discoveries. Those who maintain our tax terms are too low might be satisfied but I remind them that 60% of zero is still zero.


If a reasonable person were looking for countries with which to compare Ireland’s petroleum tax terms, he or she would look to countries such as Portugal, Spain and France with more similar success records to Ireland. Under the 2007 terms, the tax rate in Ireland varies from 25% to 40% depending on the profitability of the oil or gas field. This compares well with a tax rate of 27.5% in Portugal, 30% in Spain and 34.4% in France.


Deputy Ferris reminded me of my ambition for this industry in the 1970s. The Deputy was 30 years behind me then and he is 30 years behind me now. It is true that when Ireland’s first licensing terms were introduced in 1975, they provided for the then prevailing rate of corporation tax, which was 50%, along with royalties. At that time, there was a perception that the Irish offshore would be the next North Sea and the licensing terms were written to reflect this. With only four commercial discoveries of gas since then and no commercial discoveries of oil, it is clear that the optimism of the 1970s was unfounded. The revisions to the licensing terms since 1975 addressed the emerging reality that Ireland was not the new North Sea and that there was a need to take measures to incentivise mobile international exploration investment to choose Ireland over other areas that had been more successful to date.


The abolition of royalties in 1987 was one such measure. Ireland followed the lead of Norway and the UK which had moved from a royalty based regime to a tax based regime. Royalties are a relatively blunt instrument, in that the charge is not related to profit. A tax on profits is a more predictable charge for both industry and Government. I recognise that setting the tax rate for a sector such as the petroleum exploration and production sector is not an exact science. The experience of the past 25 years since royalties were abolished in Ireland and the almost 20 years since a 25% basic tax rate was introduced provides ample evidence that Ireland had not set its terms too low. There was no stampede of exploration investment after a petroleum tax rate of 25% was introduced in 1992, at a time when the general rate of corporation tax was 40%. In the following decade an average of three wells a year were drilled in the Irish offshore. This compares with an average of almost 80 wells a year in Britain in the same period.


In 2007 the tax terms were again reviewed. The review undertaken by independent economic consultants considered the appropriateness of Ireland’s licensing terms in comparison with other European countries with which Ireland competed. It concluded that there might be potential to capture a higher share for the State on more profitable finds but that the potential for this should not be overestimated. Accordingly, it recommended the introduction of a supplementary tax in the case of more profitable fields. The 2007 terms apply to all exploration licences granted since January 2007. Under the 2007 terms, the State’s tax take on very profitable fields will be up to 40%.


I would now like to turn to the matter of the Corrib gas field and the manner in which the State stands to benefit. While construction of the facilities to date has generated significant employment opportunities, the principal financial benefit to the State will be in the form of the 25% tax rate that applies to profits from the field under the 1992 licensing terms. In the normal way, the tax provisions applying are set down in the Finance Acts, not in a contract with the developer. The 2007 tax terms do not apply to the Corrib gas field, as they do not apply to exploration licences granted prior to 2007. To do so would have been to introduce what would, in effect, have been a retrospective form of taxation and such an action would not have been in Ireland’s interest.


The second way in which the Corrib gas field will benefit the people is that it will significantly strengthen Ireland’s security of energy supply. Corrib gas will meet approximately 60% of Ireland’s gas demand in the first four to five years of production. That will represent a significant strengthening of Ireland’s natural gas security of supply as Ireland currently imports approximately 95% of its natural gas needs.


I reject the call made to revoke existing exploration and production consents. Ireland needs more exploration for oil and gas, not less. It needs more discoveries such as the Corrib gas field. While it might suit conspiracy theorists to suggest otherwise, the reality is that the number of commercial discoveries made in the Irish offshore is very low. Exploration levels have also remained stubbornly low, despite a range of initiatives directed at attracting an increased level of investment. This represents a real challenge for Ireland. Without an increase in the level of exploration activity Ireland will not benefit from its indigenous natural resources. It is something of a catch 22; more exploration effort, in particular exploration drilling, is needed if the petroleum potential of the Irish offshore is to be proven, but until more commercial discoveries are made, it will continue to prove difficult to attract a significant level of new exploration investment to Ireland.


In an effort to attract exploration investment to Ireland the Department actively promotes the opportunities for investment in the Irish offshore. It also supports research initiatives directed at developing knowledge of Ireland’s petroleum potential. At the end of next month the 2011 Atlantic margin licensing round will close. This licensing round is structured differently from previous rounds and aimed at stimulating a new momentum in exploration activity. In particular, it has the objective of attracting some new exploration companies to the Irish offshore. I look forward to its conclusion in six weeks time. I am hopeful it will bring a new momentum to the level of exploration activity in the Irish offshore. This, in turn, would increase the chances of much needed new commercial discoveries being made.


I do not have to remind the Deputies in whose names the Private Members’ motion was submitted that the 1919 democratic programme also provided that, “It shall be our duty to promote the development of the Nation’s resources, in the interests and for the benefit of the Irish people”. I trust that I have clarified for the House that the Government does have a clear, sensible and rationale approach in this area of public policy. It is a policy approach with a clear objective of ensuring the people do benefit to the maximum degree possible from our indigenous natural resources. It is a policy approach that recognises also that Ireland needs to attract a significant increase in the level of mobile international exploration investment. It is a policy approach that offers the best chance for the people to benefit from our indigenous oil and gas resources. Ireland’s oil and gas tax regime is fit for purpose. The challenge for Ireland is to encourage a sufficient increase in exploration activity to bring about further commercial petroleum discoveries. It is only by doing this that the people will benefit fully from our indigenous oil and gas resources.


Deputy Michael Healy-Rae:   I thank Sinn Féin for bringing forward the motion and the work it did in preparing for it. I also thank the Minister for his comprehensive response.


The exploitation of the natural resources of the State is a matter that should and must be the subject of a proper debate on how we as a nation should maximise them for the benefit of citizens. I welcome the opportunity that the motion gives to engage in a wider debate on this critical issue. I have reservations about accepting the motion as it stands because it goes too far too quickly. Having listened to the Minister’s comprehensive response, he has added to the debate. That is what the House is about; Members bringing forward and debating an issue.


We must debate this issue in a wider context where all of the natural resources of the State are used for its benefit, not solely for the shareholders of multinational conglomerates. There is no doubt that mistakes were made in the past in licensing the exploration and harvesting of the vast natural resources of the State and that lessons must be learned from them. I knew a great man who always said to me: “The person who never made a mistake never made anything.” As a nation we must be shareholders in exploiting the resources of the State. As Members of the House we are the servants of the people and it is incumbent on us to maximise the value to the State of the harvesting of these resources. In these times of financial hardship for many it is imperative that all streams of available revenue are explored. I, therefore, urge the Government to give a commitment to a total review of the licensing procedures for the exploration and harvesting of the State’s natural resources. If we as Members of the House aspire to having a fair and just society, we must be seen at all times to be working in a way that the multinational conglomerates which received licences to explore and harvest the natural resources of the State are not seen to be exploiting citizens for profit.


I again thank the Minister for his response and Sinn Féin for tabling the motion. This is a good debate to have in the House.


Minister of State at the Department of the Environment, Heritage and Local Government (Deputy Fergus O’Dowd):  Tááthas orm an deis seo a thógáil chun páirt a ghlacadh sa díospóireacht thábhachtach seo. Is ábhar tábhachtach é seo ar fad. Bíonn go leor plé sna meáin chumarsáide faoin ráta cánach a bhaineann leis an earnáil pheitriliam. Is maith an rud é go bhfuil an díospóireacht ar siúl anocht chun an cheist a phlé agus an t-ábhar a shoiléiriú.


Is léir dom go bhfuil ról tábhachtach ann don earnáil pheitriliam chun cuidiú le geilleagar na tíre sna blianta atá romhainn. Más rud é gur féidir linn níos mó a dhéanamh, caithfidh polasaí an Rialtais bheith docht daingean agus a chabhrú go mór leis na comhlachtaí atá sásta airgead a chur isteach sa tír seo chun an earnáil sin a thabhairt isteach.


Mar sin féin, is léir dom go bhfuil tráchtairí ann a thabharfaidh le tuiscint go bhfuil Éire ina suí ar shaibhreas ollmhór agus, mar thoradh, go bhfuil an ráta cánach ró-íseal. Ní aontaím leis an dearcadh sin ar chor ar bith.


  8 o’clock


I welcome the opportunity to contribute to this debate. Too often the debate on Ireland’s tax terms for the production of oil and gas has been characterised by overly simplistic arguments. These arguments frequently have little grounding in fact and pay little attention to reality. On other occasions it is even worse and the debate can be characterised by misinformation and presentation that attempt to tell the Irish public that we are sitting on vast petroleum resources comparable to those being produced in Norway or the United Kingdom. The message being communicated is that all Ireland needs to do is increase the relevant tax rate, introduce royalties on petroleum production and all of our economic concerns will be at an end. If only there were such a simple answer.


While a line of argument such as that to which I refer may suit the objectives of some, it is not only unhelpful but has the potential to be damaging. Research sponsored by my Department has estimated the possible petroleum resource potential of Ireland’s offshore. The purpose of that research was to assist Ireland’s efforts to promote its offshore as a potential location for exploration investment. The research estimated that there could be reserves of up to 10 billion barrels of oil equivalent in the Irish offshore. Let me make it clear: this is an estimate of what might be present and is not based on actual discoveries already made.


There is no valid basis for making the jump from an estimate of what might be present to then treating it as if it were oil and gas that had already been discovered and could be produced. To do so is to totally misunderstand the research conclusions and ignore the significant and expensive exploration work that would be required to establish the veracity of the 10 billion barrel estimate.


As is often the case, the reality is less fantastic and may not suit the agenda of some people or parties. While the Irish offshore has recognised potential as a petroleum-producing area, it is relatively underexplored. It is an area where there has been relatively limited exploration and in which there have been only four commercial discoveries to date. As a result, the petroleum potential of the Irish offshore is largely unproven. This is quite the opposite to the experience in Norway and the UK. In those countries, extensive exploration, carried out over many decades, has clearly proven the existence of significant petroleum reserves.


Regardless of whether we like it, there is a fundamental difference in the position of Ireland and that of countries such as Norway and the UK. We would be better off if the reality was different and if Ireland was in a position similar to those occupied by Norway and the United Kingdom. The truth is that we do not have proven reserves of anything approximating the levels which obtain in Norway or the UK. As a result, Ireland could not impose a tax regime similar to those which hold sway in Norway and the United Kingdom and still hope to attract exploration investment. We have worked hard to build some modest momentum in exploration activity during the past decade. Imposing a tax regime similar to those which obtain in Norway and the UK at this point could be expected to wipe out all interest in exploration in Ireland overnight. It is quite obvious that this would not be in the national interest.


The following factors all contribute to the relatively low level of exploration activity in the Irish offshore - the international industry’s perception of the prospectivity of the Irish offshore relative to that of other areas; the cost of exploring the offshore is high as a result of both its remoteness and deep water depths - in the Atlantic margin, water depths are seven to eight times greater than those in the North Sea; the cost of drilling a single deep-water well in the Atlantic can be in excess of €100 million; and limited availability of infrastructure, such as pipelines, terminals and platforms, increases development costs and impacts negatively on the commerciality of smaller marginal oil and gas discoveries.


Notwithstanding this, Ireland continues to attract new companies and new exploration interest. This is achieved through active promotion of the opportunities offered by exploration in a frontier area such as the Irish Atlantic margin. A key to this is the holding of regular licensing rounds. As the Minister stated, at the end of next month the 2011 Atlantic margin licensing round will close. This is the largest licensing round to date and relates to an area of just over 250,000 sq. km and includes all of Ireland’s major Atlantic basins. The Atlantic margin licensing round is designed to: attract new exploration companies and new exploration investment to Ireland; encourage companies to look at areas of the Irish offshore in respect of which little data currently exists and little is known of their potential prospectivity; and bring a new momentum to the level of exploration activity offshore.


While informed debate is always positive and to be welcomed, overly simplistic contributions are unhelpful at a time such as this. If we are to be more successful in attracting international investment in respect of oil and gas exploration, we will achieve this by advancing our case on the basis of its being supported by science and reason. We can be more successful in this regard if we provide access to quality data and new ground-breaking research, coupled with a tax regime that recognises Ireland’s attractiveness relative to other competing jurisdictions.


An unrealistic debate that is premised on the 1970s analysis of the Irish offshore being the new North Sea is not particularly helpful. Calls for the revocation of licences already granted do not help in building confidence in the stability of Ireland as a place for foreign investment. The message we must communicate is that from an oil and gas exploration perspective, Ireland is very much open for business. We must send a clear message that new exploration companies would be welcome and that there are good opportunities for investment in the Irish offshore. We must also communicate that key aspects of the regulatory regime governing oil and gas exploration and production have been modernised in recent years. We must also advertise the commitment in the programme for Government to further streamline that regulatory framework.


It is 15 years since the last commercial discovery was made in the Irish offshore. That is a negative factor in seeking to attract new companies to Ireland. We must send out a clear message. We require an approach that encourages more rather than less exploration in the offshore; creates certainty and not uncertainty; and ensures that the people of Ireland benefit from its natural resources. This Government is committed to acting in a way that will incentivise exploration for Ireland’s indigenous oil and gas resources. Maintaining a balanced fiscal regime which reflects, in an appropriate manner, Ireland’s relative attractiveness when compared to other countries is central to that objective. The current fiscal terms meet the objective to which I refer.


Deputy Éamon Ó Cuív:   Ba mhaith liom leasú Fhianna Fáil a mholadh: go gcuirfear an cheist seo faoi bhráid choiste na Dála mar ní féidir é seo a phlé in uair go leith. Nuair a tháinig an Dáil seo le chéile, gealladh dúinn ag an Rialtas go mbeadh bealach nua polaitíochta ann, bealach a bheadh oscailte agus a thógfadh isteach Baill an Tí seo chun scrúdú a dhéanamh trí choistí ar mhórfhadhbanna agus ar mhórcheisteanna an lae. Mar sin, iarraim ar Shinn Féin agus ar an Rialtas glacadh leis an mholadh atá déanta ag Fianna Fáil go gcuirfear an rud seo ar fad faoi bhráid coiste le plé go mion le gur féidir linn ní amháin dul ina luí orainn féin ach chomh maith leis sin dul ina luí ar an bpobal i gcoitinne maidir leis na téarmaí atá ar fáil do thoraíocht ola agus gáis ar an gcósta.


I wish to recommend Fianna Fáil’s amendment to the House. Our amendment recognises the fact that the Government will leave the Chamber convinced that it is in the right. I do not believe Sinn Féin has been persuaded by the Government’s position. This entire matter should be referred to the Dáil committee relevant to the Minister’s Department when it is established and should be examined over a fixed period of six months. During that period, the committee should be given the necessary resources to allow it to invite whomever it wishes to come before it. In addition, the Department’s analysis relating to this matter should be made available in order that we might achieve a meeting of minds.


No matter what the Government says or believes - when we were in Government we took a fairly similar line - there is a perception that our national resources have been made available to bidders on very favourable terms. I have heard both sides of the argument. I attended a meeting in Galway last year when we debated this issue at length. If this Dáil is to mean anything, surely this is an ideal subject to put before a committee, bring in all the people who have different views on it, hear them out, let the committee put a report to Government and ask it to act on that report within three months.


I cannot understand what anyone has to lose by agreeing to this. Sinn Féin Deputies, rather than having a day of glory in the House and making fixed speeches, would get an opportunity to test the theories they have put forward and see if they hold water and if we are selling our resources at bargain basement prices. They believe we are. I believe none of us knows until we examine all the various ideas put forward in detail. Only then, when we have informed ourselves, will the House be in a position to decide whether the terms are right.


I was amazed at tonight’s speeches. If Fianna Fáil Deputies had given those speeches at any time in the past ten years, the members of the Government would have lambasted us. They would have said we had sold our birthright. There would have been dark mutterings about certain politicians having given away our national resources.


Deputy Fergus O’Dowd:  Would that be Ray Burke?


Deputy Seán Crowe:  We have not heard tomorrow night’s speeches.


Deputy Éamon Ó Cuív:  It is amazing that, tonight, they trot out the Department’s line. Given my association with the discussion that took place on the Corrib gas field, I am more familiar with it than most. If only to allay public disquiet, whether well-founded or not, what is to be lost by opening all the books? If the Government believes it has a watertight case, historically and in the terms offered for the future, what is to be lost by facilitating a thorough examination of this issue by an Oireachtas committee, seeing if the arguments the Department has traditionally made hold water and acting accordingly? Even if the Government is 100% convinced these are the best terms, we all have much to learn from discussion of these issues. I cannot understand why the Government would not go the extra mile, have this detailed debate and then persuade the public.


Everything that has been said tonight has been said before. I have read all of that documentation. I read the report that was produced before the former Minister for Communications, Energy and Natural Resources, Éamon Ryan, made the changes in the exploration terms. However, the people are not convinced. Therefore, I ask both sides of the House, in the new dispensation that this Dáil promised, to consider, overnight, referring this matter to an Oireachtas committee with clear terms of reference, the resources and powers to carry out the examination and a fixed time limit within which to report. This is what I propose in my amendment. That would have three possible results.


Deputy Pat Rabbitte: What does Deputy Ó Cuív want us to examine?


Deputy Éamon Ó Cuív: We would examine the issue that is before us tonight, such as whether the terms are right.


Deputy Pat Rabbitte: Right.


Deputy Éamon Ó Cuív:  The Minister’s Department will tell him there can be no argument or question about this. However, there are Members and large numbers of people who are not convinced by the Department’s arguments. It is fair to say the Minister was not entirely convinced by those arguments a few years ago but he is suddenly convinced by them after two weeks in the Department.


Deputy Finian McGrath:  He used to want to nationalise the lot.


Deputy Éamon Ó Cuív: If the Department has such good information that it has convinced the Minister so quickly, why can he not go to a committee, go through all of the details he has seen and all the data to which he is now privy and that has convinced him so quickly, and persuade everyone in the country, including Sinn Féin, that what the Government is doing is right?


Deputy Pat Rabbitte:  I think we can agree to that. However, Sinn Féin, who moved the motion, want us to go back to the Ray Burke award. We would have to start from there.


Deputy Éamon Ó Cuív:  I have no difficulty with that. I remember putting a question to one of the Minister’s predecessors, the late Gerry O’Sullivan, when he was Minister of State at the Department of the Marine, because people were telling me that resources were being sold at a very cheap price. I was told the prices were not a ministerial give-away but the right terms. The Department was very defensive of the terms at that time. Fianna Fáil was not in Government at that time and I was a backbencher. I raised the issue because people had come to me to say the terms were far too favourable towards the oil companies. Since that day, this debate has rumbled on, year after year. If only to assuage public opinion, I cannot understand why the Minister could be against a committee inviting people of different views to put their case before the elected representatives of the people. Why could the Department not make its case available to a committee, as it would to a Minister? An Oireachtas committee could then make a report based on its findings and we could try to build consensus on this issue, for the good of the people.


There are very few things in life that could not, with sufficient debate, be improved for the future. For all sorts of legal and constitutional reasons, one cannot undo past terms. That would become clear in an examination. I do not want to express the views I may have formed over years of reading data. That would pre-empt the very thing I want to do, which is to start with a clean sheet and look at the issue. We must check what lessons are to be learned from history. I do not believe one can undo licences that have already been granted. Many of them are running out and no exploration is taking place. We must also see what is to be learned for any future licensing round to ensure that the State gets the best return.


There has been a debate as to whether the State should become an active player, as happened in Norway. I would be interested in hearing what the Norwegians have to say about investment in Ireland, because of the much higher risk factors involved in Irish waters. I would love to know if, given our circumstances, they would have followed the same policy as they followed in Norway, where the rate of success was much greater.


At the beginning of this new Dáil, I ask that we get out of the trenches and see if we can let Dáil committees do what we are always saying they should do, that is, carry out thorough examinations of issues.


Deputy Pat Rabbitte:  If the Deputy thinks it would be helpful, I will agree. I will accept the spirit of his proposition.


Deputy Éamon Ó Cuív:  I welcome that. In all my dealings with the Minister’s Department, and I had many, I found it very defensive. I do not know why it was so defensive. It was very dogmatic about this issue. I would love to be so certain about everything in my life. I would love to be able to say I have something 100% right and that there is no room for debate. That dogmatism has not helped this debate. Therefore, d’iarrfainn ar an Rialtas agus ar Shinn Féin rud fíor-neamhghnách a dhéanamh sa Dáil seo. Is é sin, go mbeadh tionchar ag díospóireacht ar céard a dhéanfaimid agus go mbeadh ciall agus cúis le teacht isteach anseo agus labhairt.


I would hope that overnight, both sides, which have put very trenchant but diametrically opposed cases, would reflect on the Fianna Fáil amendment to the motion. I do not know if one could put an amendment to the Fianna Fáil amendment. I hope they would reflect and agree that the best way to progress this matter is to put it to a committee of the House so that the debate would mean something. The debate should be about putting forward ideas that can change people’s minds, that can convince people. Otherwise, what happens in this House is a total charade. I have noted many times in the past years that Deputies read prepared scripts and no matter how good a case is put from the other side, nobody deflects from what he or she was told to say or what had been prepared. We all read our scripts. I have often said we might as well put them up on the Internet and stay at home.


Deputy Pat Rabbitte:  The Deputy himself was fairly good at that.


Deputy Éamon Ó Cuív: If the Minister checks the record of the House, he will find that every time issues were raised with me I pursued them and I came back. On innumerable occasions in the previous Dáil at Question Time, I offered to debate with the relevant Oireachtas committee issues of major importance to do with the various Departments for which I had responsibility. The Minister’s jibe might be smart - as most of his jibes are - but it is factually incorrect. The record of the House will show that I always wanted detailed debates and any Member who engaged with me in debate in committees found that if I did not have the answer to hand, I would come back. I was always in favour of more debate because I learned a lot from them. I was given a lot of new ideas and I was willing to change my mind.


Deputy Pat Rabbitte:  There is a difference between obfuscation and debate.


Deputy Éamon Ó Cuív:  Ba mhaith liom iarraidh ar na Teachtaí machnamh air seo thar oíche. Tá deis iontach ann toradh a bhaint as an oíche anocht a bheidh chun leasa mhuintir na hÉireann agus a dhéanfaidh cinnte go mbeidh muinín ag muintir na hÉireann ní amháin as an Rialtas ach as an Oireachtas mar áit ar féidir ábhair a scrúdú ann agus ní díreach seasamh suas ar feadh uair go leith ag léamh óráidí réamhréitithe amach. Mar sin, iarraim orthu machnamh agus glacadh leis an leasú atá leagtha síos ag Fianna Fáil.


An Leas-Cheann Comhairle:  On a point of clarification before I call Deputy Finian McGrath, we are debating amendment No. 2 only. Amendment No. 1 cannot be moved until amendment No. 2 has been disposed of. This is just a technical point.


Deputy Finian McGrath:   I thank the Leas-Cheann Comhairle for the opportunity to speak in the debate on this important motion on our natural resources and the urgent need to use them in the interests of the Irish people. I commend the Sinn Féin Deputies for bringing this motion before the House and I urge all Members to vote in support of it. Now is the opportunity for every Member to state where he or she stands on this crucial national issue. Even if there was not an economic crisis, all Deputies should support this motion and all parties should adopt it as a national policy for our oil and gas reserves.


Before dealing with the details of the motion I wish to challenge all the previous Governments on their records as regards our oil and gas reserves. We never got to the bottom of the deals signed with oil and gas companies, particularly during the time of former Minister, Ray Burke. Were back-handers given and did the major parties receive significant donations from these companies? These are legitimate questions which should be answered immediately, and our people deserve the truth. We must get all the facts regarding these big companies. As has been the case in South America, many of them are up to their necks in dealings with right-wing paramilitaries, trying to steal the natural resources from poor people. It is not just in this country that we must be vigilant; we should also be vigilant of their actions in Africa, South America and the Middle East. Greedy oil and gas companies have many questions to answer and their political supporters, both in this country and abroad, must be exposed.


The Sinn Féin motion states:


[I]n view of the vast, untapped potential that exists off our shores in oil and gas reserves, estimated by the Department of Communications, Marine and Natural Resources in 2006 to be ten billion barrels oil equivalent, which at current prices amounts to a potential value of around €700 billion;


I ask the House to reflect on the value as stated by the Department of Communications, Marine and Natural Resources in 2006. I ask Members to imagine what we could do with such an amount of money, for instance, in the health service, in the education sector, in services for people with disabilities and for facilities in St. Vincent’s hospital for those with cystic fibrosis. There has been a big delay and a big row about a project costing €20 million whereas in this motion there is mention of a potential value of €700 billion. I say to the Government to get off the stage, to listen to the facts and to look at the wording of the motion and to come up with new ideas-----


Deputy Pat Rabbitte:  Imagine what we could do if we could find it.


Deputy Finian McGrath:  I agree. We should not simply hand it over, willy-nilly. I support the motion for a complete review of the licensing and revenue terms and the immediate revocation of consents given to the Corrib consortium and the licence for Lough Allen pending such a review. I hope the Minister, Deputy Rabbitte, takes note of this part of the motion. I also support the establishment of a State oil and gas mineral exploration company holding a 51% majority share in oil and gas finds, with its own research facility which would collect full and up to date information. This is a very sensible proposal with regard to job creation in particular.


The motion also proposes the imposition of a 50% tax on oil and gas profits and a 7.5% royalty and that the revenues accruing would provide towards the resources for long term and sustainable growth in place of the current indenture to the EU and IMF because of the unsustainable bank debt. The motion proposes we use the resources for the benefit of the majority of the people of this country. These are sensible proposals and all Members should support them.


I welcome the proposals for a State oil, gas and mineral exploration company as this would provide jobs and have the potential for raising extra taxation without damaging the economy. This and the previous Government have nationalised broken banks but we give away our natural resources that are worth billions of euro. I suggest a 50% tax on all oil and gas profits. I urge the Government and the Minister to consider this motion.


I refer to countries in South America which have used their oil and gas resources in the interests of the people. In recent years, Venezuela has pumped resources into disadvantaged areas and ghettos and delivered medical and educational services. It has used its oil and gas revenues to help the people. We should not be afraid to look at examples of where it works and where countries have used such resources to provide for the people. However, this Government has a closed mind. It has thrown up its hands.


The Minister asks what can be done as we cannot find any oil or gas. There is a surrender mentality at work. We need new ideas. We need to go out and do the business. Nobody has referred in the debate to Rockall off the coast of Ireland. In my own constituency, the late Seán Dublin Bay Loftus campaigned about this matter for 20 years in the Dáil. There is great potential for development. The Minister should be on the international stage fighting on issues such as Rockall at the United Nations and at European Union level.


We need our oil and gas and we need new ideas for economic development. We also need common sense and we need to use the resources for our people. Deputy Ó Cuív made some valid points in his contribution with regard to the public concern that the oil companies have ripped off this country. I suggest this point should be examined by an Oireachtas committee. The Ray Burke question must also be faced up to. The public have concerns and I hear them every day. We talk about Dáil reform. I challenge the Minister to say he is open to the suggestions made by Deputy Ó Cuív. We should have a debate in committee to examine if we have given away our oil and gas reserves. It is time for a change.


Debate adjourned.

Posted Date: 
21 April 2011