"From a strategic planning perspective, this is the wrong site; from the perspective of Government policy which seeks to foster balanced regional development, this is the wrong site; from the perspective of minimising environmental impact, this is the wrong site; and consequently, from the perspective of sustainable development, this is the wrong site"
THE Irish arm of Canadian resources firm Vermilion Energy, which is a shareholder in the Corrib gas project, recorded a €10.5m loss last year. That compared with a €27.1m profit a year earlier.
The large disparity between the two figures -- revealed in the firm's latest filed accounts -- is due to the reversal in 2010 of a previously recorded €38.7m impairment, which inflated its profits that year. Without it, it had posted an €11.6m loss.
Vermilion owns 18.5pc of the controversial Corrib project after it agreed to pay up to $235m (€191m) to Marathon for the stake. The price included $100m to cover working capital and debt and a contingent payment of $135m which is due to be handed over at the end of this year.
Vermilion has non-operator status within the project, which is being operated by Shell. It won't begin seeing any significant revenue until the Corrib gas field comes on stream.
The accounts state that Vermilion expects gas to finally flow from Corrib by late 2014. That reflects statements made last month by Energy Minister Pat Rabbitte. With work having started last year on the construction of a 5km tunnel, he said gas couldn't "reasonably be expected" before 2014. Vermilion said at the end of last year it undertook an impairment review of its investment in Corrib but decided no write-down was necessary.
It said the fair-value estimate of its investment was based on using a discounted value rate of 8.6pc, and total proved and probable reserves of 22.5 million barrels of oil equivalent net to Vermilion.
Earlier this month, the Canadian parent reported a second quarter profit of C$37.8m (€31m).
- John Mulligan