Dáil Éireann debate -
Wednesday, 21 Feb 1962

Vol. 193 No. 3

Committee on Finance. - Vote 44—Industry and Commerce (Resumed).

Debate resumed on the following motion:

That a supplementary sum not exceeding £170,000 be granted to defray the charge which will come in course of payment during the year ending on the 31st day of March, 1962, for the Salaries and Expenses of the Office of the Minister for Industry and Commerce, including certain Services administered by that Office, and for payment of Sundry Grants-in-Aid.—(Minister for Industry and Commerce.)

Mr. Dillon

When progress was reported on this Supplementary Estimate last week, I was putting it to the Minister that while we were in favour of this further investment of public moneys and prepared to facilitate him in providing the money, I thought it necessary, in this context of appropriating a very substantial sum of public money, to ensure that, in so doing, we had the approval and understanding not only of the members of the House but of the public generally. It was with that purpose in view that the Minister finally decided to leave this matter over until today, so that a fuller statement on the situation might be made than he was in a position to make last Thursday. I suggest to him that when he is dealing with this matter in a comprehensive way, one very important statistic which he should provide to the House is how much Canadian money has been invested in this project and how much Irish money has been invested in it.

My recollection is that a substantial sum of Canadian money was invested in this enterprise. I want to make it clear that our approval of this Supplementary Estimate is based on a careful consideration of all the facts as they are known to us. As I understand this situation, sometime between 1954 and 1957, this whole question of the exploitation of the Avoca copper deposits came to a head and the Government of that time, of which I was a member, fortified themselves with the opinions, if my memory serves me correctly, of two leading firms of mining engineers, one from America and one from Great Britain; that both these firms certified to us that in their considered judgment the ore deposits on which the mine at present exists were substantial but that in fact there was a very much more heavily mineralised area in the other half of the mining property to which the mining company could turn, in the event of the price of copper declining on the world market, and that the existence of this richer ore body provided some guarantee for the continuity of the mining operations even in face of some decline in the then very high world price of copper. Of course the world price of copper has since declined sharply.

On that advice, we consented certainly to the exploitation of this mine. We have got to keep it present in our minds that any mining project, however excellent the preliminary findings may be, has in it inherent risks, and I suppose this project in Avoca is no different from any other in that respect. As I understand the present situation we are in the process now of opening up what we believe to be the richer ore body and the money now required is necessary in order to bring the preliminary work and installation of a conveyor belt system to completion, and that when this work is done, the mining property will have an opportunity of proving out pretty definitely whether in fact under the tests of actual mining operations, it is viable or not.

Everybody, when he hears of a subscription of £250,000 to an enterprise of this kind, is inclined to ask himself: (1) what security have we got for it? ; and (2) where is this going to end? As I understand it, the answer to the first part of this question on this occasion is that we get, or are entitled to get, an equity in the mine equal to the present proposed subscription. The answer to this second question is that this increased capital contribution ought to make it possible for this company to establish, once and for all, whether this enterprise is economically viable on a permanent basis.

Those two questions being answered, if these are the correct answers, that justifies us in making this appropriation of public money in order that we can establish definitely for all time whether this is a mining enterprise which can be successfully carried on in existing world conditions or world conditions that may be reasonably anticipated. We, therefore, are prepared to support this Supplementary Estimate. But I would ask the Minister has he the figures to hand at this moment of the contributions by the Canadian interests and the Irish interests.

Minister for Industry and Commerce (Mr. J. Lynch)

I can tell the Deputy that the respective contributions are £2 million each from Canadian and Irish sources. The figure of £2 million is not quite accurate, but it is as near accurate as makes no difference.

Mr. McGilligan

Is that actual money or a guarantee?

Mr. J. Lynch

It is a guarantee on the part of the Government. It is actual money on the part of the Canadians.

Mr. McGilligan

The Canadians have £2 million and we have guaranteed another £2 million?

Mr. J. Lynch

Yes.

Mr. Dillon

And this Supplementary Estimate will represent an additional £240,000, so that on the completion of this transaction the Canadian interests have subscribed £2 million in cash and the Irish Government have contributed the equivalent of £2¼ million in cash whether by guarantee or by actual cash.

Mr. McGilligan

Is the £240,000 extra to the £2 million guarantee?

Mr. J. Lynch

Yes.

Mr. Dillon

That is a fifty-fifty basis.

Mr. McGilligan

Two and a quarter to two.

Mr. Dillon

I am clear on these facts that it would be wrong to allow the want of a quarter of a million pounds of money to prevent the mine being carried on to the point where we can determine finally the full information as to whether it is a viable enterprise or not. In those circumstances we are prepared to support the Supplementary Estimate, but I would be glad to hear from the Minister the most comprehensive statement of the general history of the transaction he is in a position to provide.

Mr. M.P. Murphy

In asking for this Supplementary Estimate of £170,000 for St. Patrick's Copper Mines the Minister indicated in his opening statement that the purpose is to provide money to assist the mining company over the coming few months when their resources will be unequal to their commitments. This is the third time the Minister has come before the House asking permission to aid St. Patrick's Copper Mines. In the first instance, in February, 1958, we were asked to guarantee £1,300,000 for these mines and that was approved. Subsequently, in December, 1959, we were asked to guarantee £550,000 and that was approved. Now we are asked to approve of £170,000 covering the period until the 1st April next and the Minister proposes to ask us again for a further £70,000 for the year 1962-63. Therefore, in all, the Minister will be asking this House to approve of a Supplementary Estimate of more than £2 million for this company which, it seems, has been insolvent for some time.

However, that is the debit side of the picture. So far as the credit side is concerned, I agree that, as far as we can judge, there is a reasonable likelihood that, when the development stage has expired, dividends will be payable on this money. I appreciate the big employment being given in the area and the general help the expenditure of this money will be not only to the workers but to the business people of the district.

My main reason for intervening is to ensure that the Minister is not devoting all the money at his disposal for mining development to St. Patrick's Mines in Wicklow. We have other copper mines in this country which would need money for capital work just as much as St. Patrick's Mines. I am referring to the mining development in my own constituency of Cork South West where during the past six years a subsidiary of a Canadian firm has expended big sums of money on development work and has given immense employment in that district.

An Leas-Cheann Comhairle

That does not arise on the Supplementary Estimate.

Mr. M.P. Murphy

I know that, Sir. I mention it as incidental to the question we are discussing. I am just asking the Minister is he expending all his money on the development of St. Patrick's Copper Mines. I am making a case that we require money for our development work.

An Leas-Cheann Comhairle

The Deputy cannot make the case relevantly on the Supplementary Estimate.

Mr. M.P. Murphy

If you will bear with me, Sir——

An Leas-Cheann Comhairle

The Deputy will relate his remarks to the Supplementary Estimate, which deals specifically with St. Patrick's Copper Mines. The other questions do not arise.

Mr. M.P. Murphy

Yes. I am assuming that if the House approves of this Estimate, the Minister will deal equitably with similar applications for help and that we are not going to give preferential treatment to St. Patrick's Copper Mines over claims that could compare favourably with their claims. That is the assurance I want from the Minister. I believe we will be looking for similar help ourselves, and the Minister might deal with that.

An Leas-Cheann Comhairle

That would relevantly arise on the main Estimate.

Mr. M.P. Murphy

I am sure the Minister will reply to that simple question on the Supplementary Estimate.

An Leas-Cheann Comhairle

The Minister would be out of order in dealing with other mines in this Supplementary Estimate.

Mr. M.P. Murphy

He does not have to deal with other mines, with respect, Sir. He will have to deal with the principle of whether money passed for mining development by this House is going to be concentrated in County Wicklow or whether it is to become available for other areas with justifiable claims. That is the question I am posing to the Minister. I am sure to reply to it would cause him no embarrassment. I do not want to dwell further on this matter. I am asking the Minister to bear in mind that we will be approaching the Minister for a similar Supplementary Estimate and, if he feels the claim is justified, I hope he will come to this House for a Supplementary Estimate to help in the development of the Allihies mines just as he has come to the House for three Supplementary Estimates to help St. Patrick's Copper Mines.

Mr. McGilligan

The Minister, in his opening words on this Supplementary Estimate, said he wanted the House to be fully informed. He cannot believe that the House is fully informed about this particular concern in view of what he said on February 15th last. He now comes before the House, I suggest, with a ventilated point of view and tells us the company finds itself unable to meet its commitments and that it is faced with shutting down. I do not know where he got that information because the first we heard of it was on the 15th February. He also told the House that the company had given an assurance that every effort would be made to keep the mine in full production but that they fear that for at least a few weeks production would have to be suspended.

That means that sometime earlier than February 15th the Minister got that startling news and there was a grant proposed of £170,000 which we are now discussing. Even with that, and the possibility that if losses continued at the rate they have been going, the mine will have to close down at least temporarily and some hundreds of workers will be put out of work. That is a very serious situation and it is necessary to look a bit at the history of this affair. In a debate that took place on the 8th February, 1956, the present Taoiseach, in the course of a long speech, said that the points made by the Opposition were aimed at justifying the selling of Avoca to the Canadians.

At an earlier period, when there had been in the Estimates a sum of £85,000 for mineral development, which at one time I had decided to defer until I got better information about the matter, we had a lengthy debate on the whole business. The present Tánaiste, Deputy MacEntee, said there were expert reports in the Department of Industry and Commerce which he put himself before the Dáil as having read, and according to the Tánaiste's statement with regard to some of those, a well-known mining engineer had said that the Avoca area promised to be one of the richest mineral areas in Western Europe. That was the area in respect of which we, as a Government, were first of all criticised for not expending £85,000 on exploration.

We did spend it eventually and when the debate of the 8th February, 1956, occurred on a piece of legislation introduced by Deputy Sweetman, then Minister for Finance, giving temporary relief with regard to profits on certain mining enterprises, we were told what the situation was as far as the present Taoiseach was concerned with regard to Avoca. At the time when the £85,000 was deferred, from an expenditure point of view there was very serious consideration given to the whole matter. There had been these allegations made about expert reports which showed the tremendously valuable mineral deposits in this area.

I remember speaking at the close of that debate and pointing out that we found three reports in 1948 when we were in Government. One was from a Swede. I said then, and still say it, that one could not have raised a pound sterling from the community on the strength of that report. The second report was from an Englishman. It was not quite as devastating as the Swede's report but nobody could still go to the public with it as part of a prospectus and expect money by way of investment. The other report, also from an Englishman, was better but nobody would think it was one with which you could go to the community and seek capital investment from the public.

I remember a meeting attended by practically every member of the Government and the whole of the Board of Mianraí Teoranta. There was the able advice of a Professor Jones who was a mining engineer and it was mainly as a result of his recommendation—in which he said that if he had any money to spare he could not see a better way to invest it than in Avoca—that we decided to go ahead with exploration work.

The exploration work went ahead, and in 1956 a lease was signed and arising out of the circumstances of the signing of this lease the legislation I have referred to was introduced. The debate occurred on the 8th February, 1956 and is reported at column 72 of Volume 154 of the Official Report. The present Taoiseach rose to the debate and now I want the House to understand the position then in respect to the mine which, according to the Minister, is now at the end of its resources and was going to shut down were it not for the fact that the Minister had asked us to come to its assistance to the tune of £170,000. The Minister even says that it may still have to close down even with the £170,000.

Mr. J. Lynch

It would be better to deal with this matter without recrimination. I can say a lot, too.

Mr. McGilligan

I want to speak favourably about the mine and what the Taoiseach said.

Mr. J. Lynch

It falls in my lap now whatever was said.

Mr. McGilligan

It is a very valuable thing to fall into your lap. At column 96 of that debate, there was a discussion about the Mogul Mining Corporation and the Taoiseach went on:

Whatever they are investing, they can hope to get with the scale of operations they are planning and the present price of copper not less than £5,000,000 in profits during the four years that they will be operating free of tax.

The whole trouble then was that the Government was selling this very valuable Irish property for practically no consideration to this Canadian company who were here to make vast profits for their parent company. At the foot of column 96 and in column 97 the present Taoiseach continued:

Present indications are that the total supply of mineralised rock at Avoca is about 13,000,000 tons. It is possible, and perhaps even probable, that the rock tonnage is larger than that but the Mogul Mining Corporation are basing their plans on the assumption, according to the statements they published in Canada, that there are 13,000,000 tons of workable rock at Avoca. They, therefore, can hope that by the time they have worked out the whole of the 13,000,000 ton deposit they will have extracted profits from the operation of round about £10,000,000, £12,000,000 or £13,000,000 in the aggregate.

At a later stage, in column 97, the Taoiseach refers to the way in which the mining company could make money out of this valuable concession and to what public money they could raise in Ireland.

The first action taken by the Mogul Mining Corporation, according to a statement published in this newspaper from which I have quoted, the Toronto Globe and Mail, was to issue $3,500,000 in debentures; so hightly are the profit prospects of this Avoca operation assessed in Canada that, according to this newspaper, the issue was— these are the words they used—“oversubscribed almost before the books opened to receive subscriptions.”

That is the picture presented against Deputy Sweetman's efforts in bringing in a Bill to relieve this company from taxes on its profits. As I say, we were told we were selling out to the Canadians and that they would get £5,000,000 profits in four years.

Mr. O'Sullivan

We gave them Dr. Singer instead.

Mr. McGilligan

And eventually they would get £10,000,000, £11,000,000 or £12,000,000 profits out of the company.

Mr. J. Lynch

This is a serious matter. I am not responsible for it.

Mr. McGilligan

Not responsible for this? Why not?

Mr. J. Lynch

Because it was the Deputy's Government made the agreement, and I am trying to save it.

Mr. McGilligan

The agreement was so valuable we were going to get £5,000,000 in four years and as much as £17,000,000 profit when they worked out the contents of this mineralised matter. The present Tánaiste—Deputy MacEntee, at that time—told the House that somebody had advised his Government that this area was likely to prove the richest mineral area in all western Europe; and, at the end of the debate on 8th February, the sneering comment came that all our arguments were to justify the selling of Avoca to the Canadians.

May I take the Minister up on the line of his interruption? Apparently it was a bad lease. Was it? If it was a bad lease, and the company are now in such a condition that they have to look for extra moneys, will the Minister get the lease improved, now that he is putting up an extra £250,000? Or is he just going to hand over the money and hope for the best?

Mr. J. Lynch

It was the Deputy and his Party who passed this. If the Deputy wants it that way, he can have it that way.

Mr. McGilligan

We were not giving any money to the Canadians. We were getting a piece of legislation through for the continuation of certain mining ventures, and that received the acclamation of this House.

Mr. J. Lynch

I shall try not to interrupt the Deputy any more, but the Deputy cannot have it both ways.

Mr. McGilligan

The Minister is having it both ways, and both are bad: he is giving more money to a firm which, on his Party's representations, was going to make a fortune.

Mr. J. Lynch

At the then prevailing price of copper.

Mr. McGilligan

Very good. Now that prices have broken, what changes is the Minister going to make with regard to the lease of the St. Patrick's Mining Company? Are we just handing them over £170,000 this year and £70,000 next year?

Mr. J. Lynch

I am not going to make any changes and, if the Deputy opposes that, he is entitled to do so.

Mr. McGilligan

So the agreement then, which was to give this company so much in the way of profits, is not giving them the profits and we propose to go on coming to their assistance with another £250,000, with no condition imposed on them. Certainly that is a soft operation from their point of view. If they can get us to pay up an extra £250,000 on top of what we have already guaranteed—by the way, when was the guarantee given?

Mr. J. Lynch

There were two guarantees.

Mr. McGilligan

What were the dates? Were they later than 1957?

Mr. J. Lynch

They were.

Mr. McGilligan

They were given by the present Government?

Mr. J. Lynch

Absolutely.

Mr. McGilligan

Both?

Mr. J. Lynch

Both.

Mr. McGilligan

So the present Government guaranteed capital moneys for a concern they thought likely to bring in to the Canadians profits of £5,000,000 in four years.

Mr. J. Lynch

With the full support of Deputy McGilligan and his Party. I said I would not interrupt.

Mr. McGilligan

I shall look back at it. I should like to see what the representation was.

Mr. J. Lynch

I said I shall not interrupt. I shall not be drawn again.

Mr. McGilligan

I am glad to hear the guarantees were given by the Government to which the Minister belongs. This is not a guarantee; this is "go-ahead" money.

Mr. J. Lynch

It is very hard to stomach this. Object to it then, and be done with it.

An Leas-Cheann Comhairle

Deputy McGilligan.

Mr. McGilligan

I was always in favour of mineral development. It was alleged at one time that I was not. I remember in the Budget of 1948 reading out the statement made by Deputy Childers, now Minister for Transport and Power, quoting what the then Taoiseach had said. That was to the effect: "Look; the British geological surveys really gave more accurate information in regard to mineral deposits in Ireland than we had ever accepted. We thought they were wrong. We thought they were politically biassed, but we have now mournfully to confess their reports were more reliable than the optimistic reports we got from our own Geological Survey." The Taoiseach at the time, and his successor, said that if we spent £85,000 on mineral exploration we would then have a picture of whether or not there were any minerals in the country worth developing; and Deputy Childers said his mournful conclusion was that there were not and on the whole, we would probably find there were no minerals worth developing, and the question was put: would it not be a good thing to spend £85,000 to have that issue settled once and for all? We spend the £85,000. The Canadians put up £2,000,000. The present Government guaranteed another £2,000,000 and the present Government are now giving £170,000, with a promise through this House of a further £70,000——

Mr. J. Lynch

By way of investment.

Mr. McGilligan

On what are we basing that, I wonder? Would the Minister look back on his speech with regard to this matter? He said at column 269 of Volume 193 of the Official Report:

It was felt that... the prospects for commercial production would be good enough to enable the Company to obtain money from private sources to finance its continued operation. The Company did, in fact, negotiate in recent months substantial additional private investment but the making of this investment was dependent on the verification by further drilling of the Mianraí Teoranta findings. The Company's preliminary testing failed to substantiate the figures produced by Mianraí Teoranta in certain areas and, accordingly, the offer of private capital was withdrawn.

So, again, there was apparently an effort to be made to get the private investor to put money into this. Mianraí Teoranta had optimistic views. They had apparently made some borings and based some findings on these. But the Company's new testing failed to substantiate the figures produced by Mianraí Teoranta and the offer of private capital was withdrawn. We get then a sudden jump to the conclusion:

The Company found itself unable to meet its commitments and was faced with the alternative of shutting down or securing further Government aid.

The Minister's approach is to ask this House for more money. What optimism can we have with regard to the future of this project? He said:

that ordinary shares in the Company up to the nominal value of the sums advanced will be vested in the Minister for Finance or his nominee should he at any time so demand.

That is this £170,000.

In this way, if this further injection of capital is successful in placing the Company on an economic footing, the State will be able to ensure a due return on its investment.

By getting shares representing £170,000 in a concern that is capitalised apparently to the extent of £4,000,000. The Minister then says he would like the House to be fully informed:

so that Deputies may appreciate the position at Avoca, a position that is quite serious. The money which it is now proposed to make available will enable production to be continued for the time being. If further testing does not produce results nearer to the findings of Mianraí Teoranta, or if copper prices decline, or if the further development work encounters new difficulties, the whole future of the enterprise may be jeopardised.

Again, I say the Minister would not go to the public looking for money if that is the best he could do about this concern. But it gets a little worse:

Every effort will be made to keep the mine in full production as long as practicable but the possibility has to be faced that if losses at the level recently experienced continue during the next few weeks, production may have to be suspended in whole or in part until development work has reached the stage where more economic production is possible.

Would the Minister just give us a few facts? When did he get to know that loss was being incurred weekly? Are these losses very substantial over the weeks? How far are the losses being experienced for some time back likely to be eased by an expenditure of £170,000? Have further borings been taken by the company? Do they substantiate the figures produced by Mianraí Teoranta? In regard to the vague phrase: "If the further development were to encounter new difficulties," what difficulties have been encountered? Are they in regard to employees' skill? Are they in regard to machines or in regard to mineralised areas or to borings. When we are presented, first of all, with a picture of a fine area of rich mineral deposits and a company that is helped to the point that draws from the Taoiseach the remark that we are selling Avoca to Canada and that gets guarantees from the Government as well, surely we are entitled to know the whole history since the last guarantee was given, whether these difficulties are ones that have been met previously or whether they have been surmounted at any time.

There is one last thing. This company is, as far as I can make out, inextricably entwined with the new fertiliser factory to be erected at Arklow. That was to depend upon certain minerals that are supposed to be in Avoca not merely being there but having been extracted for use in the Arklow factory. Does it mean that however lame this particular duck happens to be, we have to keep it going in order to give some background to the very expensive factory that is to be put up in Arklow? Can we separate the two or does the fate of the Arklow factory depend to any degree on what is happening at Avoca?

The Minister should remember that so far as the start of this was concerned, the money for exploration and even the money for exploitation was provided by a Government to which he never belonged. All he is doing now is coming to the rescue of something that at one time he expressed to be a very valuable concern. He comes in now with a miserable statement in regard to the position into which this company has been allowed to get without any notice being given to the House.

Mr. P. Brennan

Having listened to the debate on Thursday last and today, I find it very difficult to understand the Fine Gael attitude on this whole matter. Deputy Cosgrave led off the discussion on behalf of Fine Gael; the Leader of the Opposition, Deputy Sir Anthony Esmonde and Deputy O'Higgins also spoke. With the exception of Deputy McGilligan who has just spoken, they all seem to be wholeheartedly in favour of making this money available for Avoca. Deputy McGilligan, as is typical of him, tried to start a hare. We know the part he has played over the years in regard to Avoca and it is unfortunate that that trend has crept into the debate at all. This is a very serious problem as far as Avoca is concerned, not only for the St. Patrick's Copper Mines people themselves but for the men working in Avoca. I would ask the Minister, although he has already stated that even if given this sum today, the prospects are not that bright for Avoca——

Mr. M.P. Murphy

Surely the Minister would not make that statement —that even if he is given the sum asked for, the prospects are not bright —in asking the House to approve the allocation of this money?

Mr. P. Brennan

I may be wrong, but I think the Minister did indicate in his introductory statement that unless things improved in Avoca within the next two or three weeks, there would be a likelihood of a close down or a laying off of some of the men. I think that was the gist of the Minister's statement. This has caused a certain amount of worry to those of us who know this locality and the people who are employed there and who are aware of the amount of prosperity that has been brought to that part of County Wicklow by the operations at Avoca.

I should like an assurance from the Minister that even if this amount of money being made available now does not solve all the problems, every effort will be made in the future to try to keep Avoca in production. That is very important particularly to the people in the locality. It is also important from the point of view of the proposed new fertiliser industry in Arklow. I understand that industry is to be established in Arklow because the material for the production of the fertiliser is to come from Avoca. If there is a close down in Avoca, it may mean a halt to the Arklow industry. We have enjoyed an era of prosperity in that part of Wicklow. Whether it was a Fianna Fáil or an inter-Party Government who were responsible does not matter. The inter-Party Government initiated the deal with St. Patrick's Copper Mines. I am sure they made every effort to investigate the background of these people and were satisfied it was a reputable firm, capable of running Avoca economically. The fact that this Government have come to the rescue on three occasions to the total tune of £2,000,000 is an indication that the Fianna Fáil Government have a certain amount of confidence in them also.

We are all in this together and I hope this Vote will be given with the goodwill of the House. The Minister has been asked to make certain clarifications and this is very desirable. It is only right that the public should know the exact position in Avoca and I am sure the Minister will give all the information at his disposal to the House and through the House, to the people. If that is done, it might help to clear the air somewhat. I was surprised that there was any need for financial help in Avoca. I understood that things were going full steam ahead down there.

Mr. McGilligan

They did not let you in on it.

Mr. P. Brennan

I must say I did not interfere with them; it was their business. I was sure that Deputy McGilligan was satisfied with the situation in 1956 and 1957 and that successive Ministers were equally satisfied and that there was no reason why I should interfere. The only occasion I got in touch with St. Patrick's Copper Mines was when I was recommending some men for employment. There are 500 or 600 men in very useful employment there. Their pay packets mean a great deal to themselves and their families and the general public. I sincerely hope nothing will happen in the near future and certainly nothing will happen in this House that will bring an end to that. I trust the Minister will have the goodwill not alone of the Government side of the House but of all sides in getting this Vote and that we can look forward to a more prosperous time in Avoca.

Mr. McQuillan

I can sympathise with Deputy Brennan in his anxiety about the employment position in the Avoca area. He is quite right in expressing his anxiety with regard to the future prospects of employment for the workers there but that is a problem which is not confined to Wicklow alone. It is general all over the country but I think we shall have to examine a little further into the whole idea of mining development in Wicklow, apart altogether from the employment aspect.

The Minister's statement here last week was brief and there was a great air of urgency about it. I got the impression that he was most anxious that the House should have been sitting a week or a fortnight earlier so that this Supplementary Estimate might be disposed of. He pointed out the dangerous situation that had arisen with regard to the company's prospects and the danger of a close down. Having said all that and having said that the company found itself unable to meet its commitments and was faced with the alternative of shutting down or of obtaining further State aid, within 20 minutes, he announced that the debate could be adjourned and that the company had got outside accommodation.

Mr. J. Lynch

Was that not fair enough?

Mr. McQuillan

Within 20 minutes of telling us that there was danger of a close down and that there was no capital available from private sources, he was able to tell us the situation had altered. We shall have to know a little more about this before the Minister will get his money on that kind of approach.

Mr. J. Lynch

It is not my money.

Mr. McQuillan

When we see the word "serious" in any Government pronouncement, we can take it that is just what it means. The word "serious" in this statement meant that the situation was one of great seriousness and that the likelihood of the company closing down was very real. Today the Minister panicked and interrupted Deputy McGilligan. I am not taking any sides in this at all.

Mr. J. Lynch

Except against us.

Mr. McQuillan

The Minister said: "This is not my baby. I have nothing to do with it. Why are you blaming me?" That is a deplorable attitude for any Minister to adopt. As he pointed out, he is on a very bad wicket and he wants to save his own bacon. His attitude on this is that he is going to come clear out of it, whatever about the Ministers who went before him. It means that the Minister has his mind made up that this is a bad venture, but, despite that, he is asking the House for £240,000 to add to the £2 million that has gone down the drain already.

Am I right in my interpretation of the Minister's attitude? I am convinced that if there was a likelihood that this further money would help the company over a difficult period, the Minister would not be disclaiming responsibility as he has been. He would be prepared to hold his fire on the basis that the future would be good. I am afraid he has his mind made up that this is a dead duck.

Mr. J. Lynch

That is not true. I was intervening in the context of Deputy McGilligan's remarks.

Mr. McQuillan

The impression he gave is that he should not be blamed for what is happening.

Mr. McGilligan

He said that.

Mr. McQuillan

The two points the Minister made were, first, that there was a danger that the mining venture would close down and, secondly, that there was a conflict between the findings of the company's experts and the findings of Mianraí Teoranta. We got no information from the Minister as to where the conflict lay. He referred briefly to the fact that the Mianraí Teoranta findings were not similar to those of the company. Surely if the Minister is asking the House for a further £240,000, the least he might have done was to develop the point of differences between the findings of both groups. Is it a fact that the findings of Mianraí Teoranta are faulty in the eyes of this Canadian company? If it is so, let the Minister tell us and have it on record.

The Minister said that the company's preliminary testings failed to substantiate the findings produced by Mianraí Teoranta in certain areas. At the end of the debate, before the House adjourned on the last day, the Minister said in reply to Deputy Dillon that that did not mean that the Mianraí Teoranta findings were not correct. I hope he will explain what he means by that.

Deputy Dillon is more expert in mathematics than I am, but he made the extraordinary statement that this was on a fifty-fifty basis, that £2 million were subscribed by this company and £2 million by the Government. Now there is another quarter of a million being made available by the Irish Government in addition to the two millions already invested. Yet Deputy Dillon described that as being on a fifty-fifty basis. Surely it is on the basis of two to two and a quarter? It is not as simple as that. I should like the Minister to let us know what benefits the State has received through this investment of £2,000,000 so far. Were there any returns in the form of profits given back to the Government by this company?

Mr. J. Lynch

It was not an investment; it was a State-guaranteed loan.

Mr. McQuillan

How much money have the Canadian company taken out of this country as a result of their investment? What profits have been made to date on the export of copper from these mines?

Mr. McGilligan

If it is any consolation to the Deputy, the Taoiseach, in that debate in February, said they would get back all their capital in the first four years. I do not know whether they got it or not.

Mr. McQuillan

I am anxious to know what the present position is. A guarantee of £2¼ millions was given to this company. According to the Minister, they put up six million Canadian dollars or £2 million sterling. Have they collected profits on their investment so far? If they have, to what extent and where has that money gone? Were they prepared to plough back any of these profits to help in the difficult position which has now arisen? On behalf of the people I should like that question to be answered.

Further, I should like to know what benefit was conferred on the country by this venture, apart from the immediate employment that was given in the area. To what extent was our mineral wealth increased for processing here in Ireland? How much subsidiary employment was given in Ireland in processing the products of the mines? Would it be correct to say that all that happened was that this Canadian company was allowed to dig up the minerals in Avoca, bring them to Arklow and export them abroad for processing? Is that not what happened? Was there any processing, smelting or other similar operation carried on in this country as a result of the mining activities in Avoca? I do not see what great benefit the mineral wealth is to this country if it is all to be exported without any processing taking place. It is just as bad as exporting cattle on the hoof.

My information is that first-class docking and shipping facilities are being made available and harbours are being improved simply to enable copper and other by-products to be loaded efficiently and economically after being dug out of Irish soil and exported to Canada or elsewhere for processing. What benefit is there to Ireland in that kind of operation?

It may be suggested that 500 men in Wicklow have pay packets but these 500 could be getting good pay packets from forestry or other employment in Ireland. There is as much sense in this type of operation if we allow our mineral resources to be exported as there was in the Famine days in digging holes in the ground and paying men to fill them up.

This position has come about simply because we have no confidence in the ability of our own people to exploit our resources. There is not the slightest doubt in my mind that following the explorations and investigations by Mianraí Teoranta, an Irish company could have been established to deal with development work in Wicklow or elsewhere. The technical advice and assistance of skilled personnel of Irish extraction would be available if they were invited to return from Canada, Australia, England and elsewhere. We had such an inferiority complex, such little regard for our own people, that it was considered that only the Canadians or some other foreign group were fit to develop our resources. To develop them for what? —so that they would be taken out of the country and the only benefit to be derived by this country would be the immediate employment.

Who was taking the risk in doing all this? There were no profits, according to the Minister, as far as the State was concerned but there was nothing to prevent this foreign company from making profits and investing them elsewhere. The cost of speculation was being borne by the Irish people as a result of the backing of the Irish Government. If the thing went wrong, we paid for it. While it was going wrong, profits were being made and the company was able at least to save part of its losses. If things went right——

Mr. J. Lynch

May I help the Deputy? The accounts have been laid on the Table of the House since the operation started and there have been no profits made.

Mr. McQuillan

I doubt very much if the Minister is aware of the fact that for 18 months past quite a number of people in this country have believed otherwise.

Mr. Norton

It is to be hoped that they are not shareholders, then.

Mr. McQuillan

The only thing I can do at this stage with regard to the intervention of this company in Wicklow is to draw a comparison with Katanga. We have Irish soldiers out there on behalf of the United Nations trying to stamp out the activities of the Unione Miniere and prevent them from exploiting. The Central Government in the Congo want to nationalise the mines and to operate them and our troops are in the Congo to help the Central Government.

An Leas-Cheann Comhairle

Surely this does not arise on the debate on this Supplementary Estimate?

Mr. McQuillan

I am making the comparison that at home we are bringing in outsiders to develop and exploit our mines. The situation is fantastic. Deputy Brennan and other Deputies have referred to the fertiliser factory which is about to go up in Wicklow. This is a pet subject of Deputy de Valera. I have heard him on this thing for years. Will it be suggested now that there is no other suitable location in Ireland for such a fertiliser factory?

An Leas-Cheann Comhairle

I am afraid the Deputy is getting away from the Supplementary Estimate.

Mr. McQuillan

I do not intend to develop that matter, Sir. It has been mentioned by a number of other Deputies.

An Leas-Cheann Comhairle

Deputy Brennan alone mentioned it in passing.

Mr. McQuillan

Deputy McGilligan spoke about it.

An Leas-Cheann Comhairle

The Deputy will appreciate that this Supplementary Estimate is confined to St. Patrick's Copper Mines.

Mr. McQuillan

God help St. Patrick. I shall not develop the matter except to ask, will it be suggested that the future of this fertiliser industry hinges on the success or failure of the mining venture in Avoca? That is a very important question. No matter how much we may desire to have a successful fertiliser industry, I do not think we should bolster up the mining industry in Avoca for the purpose of making a success of the fertiliser factory. I do not know now whether there is anything in that suggestion or not but I should like the Minister, if it is within the rules of procedure, to comment on it.

My belief is that the Government have learned a lesson; they have burned their fingers. There is no use in the Minister saying at this stage, "This is not my baby. This was the result of activities of a former Government and I will not be responsible for it." That is a deplorable outlook on the part of a Minister who is asking the House to give £240,000 for what he at the moment, according to himself, thinks will be a failure.

Mr. Donegan

I want to be very brief and to comment on a few aspects of this matter. Our good friend, the Minister, in repartee with Deputy McGilligan, was possibly a little annoyed by the analytical mind that Deputy McGilligan brought to bear on the Minister's speech introducing the Supplementary Estimate. I would not like that the Minister's usual amiability and equanimity should be disturbed. I do not think Deputy McGilligan wanted to do so. What he did want to do, and produced a valuable contribution to the debate in doing, was to analyse and microscopically examine the Minister's speech. He looked at it as a bank director might look at a request for a loan by a company in the commercial way. I felt his contribution was extremely to the point.

If the Minister came here last week to say that this was urgent, that there was a difficulty, that he was extremely perturbed, then it is quite right that, when we vote public money, we should comment upon that situation and analyse it for the public to see just exactly what it means.

Deputy Brennan followed and, naturally, with from 500 to 600 men in his constituency employed in the venture, he would take a different line of thought. That is entirely a local line. It has no relation proper to the lending of this £250,000 as distinct from a guarantee or otherwise. Deputy Dillon, Deputy McGilligan and Deputy Cosgrave pointed out that they think we should do this: as far as this party is concerned, this measure will be voted for by us.

Mr. J. Lynch

I did not gather that from Deputy McGilligan.

Mr. Donegan

The Minister may never have sought a loan for a business enterprise from a bank. If he had, he would recognise in Deputy McGilligan's contribution the proper analytical approach of a bank director. The function of an Opposition is to analyse and look at every line of the Minister's speech and say that it is a calculated risk. That is what he said.

Mr. J. Lynch

And then suggest he might go elsewhere.

Mr. Donegan

I often heard the Taoiseach say in this House: "We are taking a calculated risk." The Opposition is quite prepared to back it but it is no harm to point out that it is a risk. I do not think it is doing any harm to St. Patrick's Copper Mines or to the future of the employment of the people there.

I want to talk about the disposal of products from that mine. I would refer the House to column 260 of the Official Report of Wednesday, 15th November, 1961. The Minister for Industry and Commerce said:

During the course of the second committee's deliberations it became obvious that nitrogenous fertilisers produced from a combination of the gasification of fuel oil and the sulphur content of Avoca pyrites would be a very economic undertaking because the prices would compare very favourably with the low prices of imported nitrogenous fertilisers.

Out of that, we have a Board set up, a loan guarantee for setting up this nitrogenous factory at Arklow. We have to look at the whole position. What does the Minister now feel about that project? The Opposition wish to see this go through but it is our function and job to examine it, word for word, item by item. The Minister must not—and I am sure that when he thinks again about it tonight, perhaps, in a more convivial atmosphere, he will not—take this analytical approach by us as something that should not happen.

Major de Valera

I am sorry Deputy McGilligan should go his usual road of throwing a spanner in the works for the sake of wrecking, no matter what is at stake. I am afraid that is what he has done. I am rather sorry to have to say I am afraid it is all we can expect. I wonder if he does not realise that in our modern context it is not debating points that matter: it is a solving of the problems that matters.

Up to that, the debate had taken a very reasonable line and I should like to get back to it. I am sorry, also, that Deputy McQuillan was, I gather, ruled cut of order because I think the fertiliser factory has a bearing on this question. The problem, as I see it, that has to be faced here is simply this. You have a mine which has been established and accepted. A certain difficulty has arisen because of a difference in the reading of borings, as I understand the story. There has been a question of the reading of two sets of borings. The Mianraí Teoranta results have not been fully substantiated by the company's results and there is need for further exploration. That type of thing is something that happens very, very often in mining projects. As yet, technical developments in exploration have not reached the stage where one can tell the content and extent of all mineral deposit with the certainty that one would like before one is committed to substantial expenditure. In other words, there is always an element of speculation in spending money on mineral development in its early stages—in the stages of finding out exactly what is there to be exploited.

For my part, I sincerely hope that the more optimistic estimates of what ores are available in this mine will be borne out. I hope that the ores are there in the richness and the quantity necessary to make them economic. That brings me to another point which Deputy McQuillan suggested. When you have, say, a deposit of a substance like copper ore you have two problems. First, you have to get it out and, secondly, you have the problem of what to do with it. As yet, it would appear that getting it out and a guarantee for the future of sufficient quantities to make the project viable is to some extent questionable.

Assume, for the moment, that the copper ores are there. What can one do with them? We come up here, all too frequently, unfortunately, but I do not think there is anything any of us can do about it, against the problem that we have limited deposits of, say, some exploitable mineral and there are not sufficient to warrant the development of them completely at home. In other words, they are not sufficient nor would it be economic to develop them—to process them, I think, is the phrase Deputy McQuillan used —at home. That is an unfortunate fact that attends mining not only in this country but sometimes in others.

You have to take into account also the economic environment. As I understand the situation, we can, with development, extract copper ores from these mines which can be profitable in a double sense, that is, in the employment and development provided locally and profitable in the sense that they provide an export. Deputy McQuillan was rather scathing about the exploration of these ores. To some extent, I sympathise with the basic idea that prompted him to make his remarks in that connection but he did not, and should not, forget the value of the local employment involved and he should not forget either that there is some value to the community in the export of that commodity. It is a net export that helps the balance of payments problem that a country like ours has. If it were possible economically to process those ores, to smelt copper and process it and, after that, produce copper goods, I do not think he would have to press me very hard for support.

Mr. Norton

You would need four Avocas to do it successfully.

Major de Valera

Exactly. Not only would you have the problem of the availability and the quantity of the raw materials—the ores—but you would also have the problem of the size of the installations that would be necessary for the processing.

Mr. Norton

It would need £5 million or £6 million.

Major de Valera

Quite. The Deputy is making my point for me. You would need very big plant and you would then have the problem of what to do with the output, granted you had the input. From such little information I have, it seems that the processing of copper, the setting up of smelting plant, providing for production and an economic situation that would maintain the industry, is not a real possibility in the case of Avoca ores, and in the circumstances we are doing well if we are able to win them in the first place and sell them at a profit in the second.

At the risk of being out of order, I really think that it would be a great advantage if Deputies had an opportunity of seeing some of the installations involved in such developments. Any of the modern chemical, mining or industrial installations I have seen abroad have always surprised me by their size and I must confess that I have been somewhat discouraged at the magnitude of the problems we must face here at home. Please do not take me as being defeatist in that but there is a real problem in regard to these mines, giving due credit to anyone who deserves it.

Mr. McQuillan

The Minister does not want it now.

Major de Valera

Will the Deputy resist temptation and not ask me to bracket him with Deputy McGilligan?

Mr. McQuillan

I am merely saying the Minister does not want it.

Major de Valera

I should like to give the Deputy credit for approaching this matter with a sense of its seriousness. He says himself there is a great amount of money involved, apart from anything else. From the point of view of the development of the locality and employment, it is a big thing for the area and the country; as an export, it is important but it seems that it has another importance also. The Arklow factory has been mentioned, something that can be of real importance to us. I do not know how closely the Arklow site for this factory is bound up with the development of the Avoca mines but one part of that factory is independent of the mines. The nitrogen, the ammonium nitrate unit and its plant are quite independent of pyrites from Avoca.

The other part of the fertiliser project, the sulphuric acid plant, is intimately and directly related to pyrites output. It would be a pity if we could not use native pyrites for the production of sulphuric acid needed for the fertiliser industry and had to rely on imports. Without detailed information, I cannot pontificate on the economics of the situation but there is this to be said—if we cannot use native sulphur sources, like Avoca pyrites, then we shall have to import sulphur from outside. Obviously, we would all prefer the native product to support the factory. Is it then a question—I am putting this to the Minister because I cannot answer it—that if it does not prove possible to continue exploitation of the copper ores at Avoca we must also forgo the development of the pyrites associated with the mine? Does the fact that the development of copper ores is in jeopardy also mean that the supply of pyrites to the new fertiliser factory is also in jeopardy? If so, it is a pity but it is a greater reason why an effort should be made as far as possible to save this project and to help at this critical stage in maintaining the development of these mines up to a point where at least we can be more definite.

I think that is the relation of the Avoca project to the Arklow project. If, as I suspect, a failure in respect of copper ores means that the use of pyrites available there will become uneconomic and that we may have to import pyrites or other forms of sulphur it is all the greater reason for giving this Supplementary Estimate. Athough Deputy McGilligan was more concerned with scoring debating points than dealing with the real problem I think everybody else in the House, including even Deputy McQuillan—who had his criticisms —is keen to have this project seen through to a conclusion and, we hope, to a successful one. I think the House is unanimously behind the efforts that are being made to develop these mines.

Mining operations, by their very character in modern circumstances are, up to the stage where development results in a steady, foreseeable output, a speculation. This project was in the nature of a speculation when mooted and when the decision was made by the inter-Party Government to proceed with it. It has been in the nature of a speculation all through its development and the two Governments have been conscious of that. The interplay in the House may only have served to emphasise that. Somebody used the phrase "calculated risk": that is what is involved. It is important that in doing this—and apparently it is being done with unanimity in the House—we realise clearly what we are doing, and that what we do, we do deliberately.

Mr. Corish

I do not think it necessary to emphasise how concerned all of us are at the prospect of so many men being rendered unemployed by reason of a stoppage of the development of the Avoca copper mines. We are also concerned, as Deputy de Valera said, about the decrease there may be in our exports, if these mines are closed down. I do not want to repeat or emphasise what has been said by other Deputies, but I want to express what to me is a matter of grave concern.

I am informed that up to date the State, through various sources, is guarantor for something like £2 million to the Avoca copper mines. It must be agreed that that is a very substantial figure, an enormous figure. I should like to know from the Minister if we have any sort of contact with those who are responsible for spending that money. Are we to be confronted in another 12 months' time with a demand or a request from the directors of the Avoca copper mines for £100,000, £½ million? I know that such a request or demand cannot easily be resisted by the Government, or by the Minister for Industry and Commerce if he has regard to the employment content and to the export figures, but I think it would be reasonable for the Irish people to expect from a Government, irrespective of what Minister and what Government were in office, that they would have some control in the spending of that money. That should apply not only to the Avoca copper mines but to all concerns in respect of which the Government guarantee a substantial amount of money.

I wonder is it the situation that it is only when a concern, a factory or an industry "goes bust", or ceases its operations, that the Government know about it? I do not say that has happened in any widespread fashion, but there are a few concerns which announced blindly, and without any prior notice, that they were folding up. I wonder, therefore, what has happened or will happen in respect of the guarantee the Government have given for, in some cases, tens of thousands or hundreds of thousands of pounds.

From the Labour benches, we have advocated, from time to time, that where an industry gets substantial financial assistance, the Government should at least, in the name of the Irish people, have the right to appoint a director. I do not know the actual process by which that could be done, but I do know of at least one example where the Industrial Credit Corporation advanced money by way of loan to a certain concern and had the right, took the right, or was given the right by the directors of the Company, to appoint a director themselves.

I put this to the Minister and to the Government: would it be unreasonable for the Irish people, or for Dáil Éireann, to expect in respect of a concern to which £2 million is being applied that we should have a director appointed by the Government or some other agency of the State. That is my concern in all of this. No one wants to see the Avoca copper mines close down. I never thought that we would arrive at the situation so quickly in which certain Deputies started to blame one another for the Avoca copper mines. The practice in recent years has been an effort to claim credit for them by different Deputies on both sides of the House. The Minister is concerned about employment; Deputy Brennan is concerned about employment; I am concerned about employment; Deputy Norton is concerned about employment; and so is everyone in the House.

Mr. J. Lynch

Except Deputy McGilligan perhaps.

Mr. Corish

I do not want to interpret or misinterpret Deputy McGilligan's speech, but I assume he is as concerned about employment as anyone else.

Mr. J. Lynch

The Deputy should consult Deputy Norton. He has an apt phrase to describe Deputy McGilligan's concern. The Deputy remembers the steam-rolling reference?

Mr. Corish

My only object in standing up is to get, if we can, some observations from the Minister as to whether or not he thinks it desirable— we certainly do—that there should be some Government or State representative in a concern into which has been pumped, or will be pumped, the sum of £2 million.

Mr. Blowick

In case any other Deputy has not requested him to do so, I should like to ask the Minister to give us some details as to why this apparent failure of the St. Patrick's Copper Mines has taken place. My reason for asking is that I remember during one period of the inter-Party Government this venture appeared to be about to collapse. As a result, the inter-Party Government made an attempt to decide once and for all whether or not there was anything worthwhile in the place. The report we got from experts was that apparently deeper than the workings that had taken place up to then there was a very valuable deposit of copper, zinc if I remember correctly, and quantities of silver and gold. Quite candidly, I did not follow the fortunes of that mine since that time because I took it for granted that things were going very well. It came rather as a surprise to me when the Minister came here asking for money, indicating that the venture had not turned out the success we all hoped it would be. I should like the Minister to give us a detailed account of it.

Deputy McQuillan asked why we are exporting the raw material instead of processing it here. If the Minister has an explanation perhaps he would give it and I, for one, would like to know it. It seems strange. Unless the position is that we have not the experts or the cost of processing would be immense or something like that, I cannot see the commonsense of mining out our minerals and giving the raw materials over to some other place to be processed. Perhaps there is a perfectly sound and valid answer to that question and I am anxious to hear it.

Mr. J. Lynch

When I introduced the Supplementary Estimate last week, I told the House there was a certain urgency about it. In the course of the debate, some Deputies asked a number of questions, the answers to which I had available to me at the time. There were some details of the questions I might not have been able to elaborate on but, nevertheless, having regard to the fact that the time at my disposal under the Orders of the House was so short, I agreed to the suggestion made by Deputy Dillon that the debate might be held over until today.

I gave as a reason for the urgency in bringing the Estimate before the House the fact that certain difficulties with regard to the continuation of operations at Avoca had arisen. Deputy McQuillan sought to cast doubts on the bona fides of what I said during the debate the last day. The fact is, during the course of the debate, I had it established that the company had got certain bank accommodation on the basis of the introduction of the Supplementary Estimate and, therefore, when I negotiated the introduction of the Supplementary Estimate last week, I was under the impression that it was urgent to that extent, but by reason of the accommodation given to that company the immediate urgency had passed. Nevertheless, there is some urgency still because the accommodation is of limited duration. I hope that disposes of Deputy McQuillan's point.

I said in my introductory statement that I would be anxious to give Deputies the fullest possible information and I still stick to that undertaking. I have tried to get as much information as possible in the interim in order to fill in any gaps that were in my knowledge of the history of the operation and the present financial position of the mine. The debate was conducted in a constructive manner and it was my intention to approach it in that way. In fact, on more than two previous occasions I handled business in connection with this venture in this House and on these occasions the contributions from both sides were very constructive. Unfortunately, Deputy McGilligan came in to-day and poured invective on what I said and made insinuations which I found very hard to listen to. Unfortunately, I lost my patience but I think I am entitled to flashes of temper on occasions when Deputy McGilligan puts me in the position he did to-day. I do not know what Deputy McGilligan's attitude is. Deputy Donegan interprets it as being in favour of the continuance of this mine and I suppose I shall have to accept that interpretation because I expect that he knows Deputy McGilligan better than I do. Certainly, from what he said, he seemed to be prepared to go into the division lobby and vote against the granting of this money.

Mr. Donegan

Not at all.

Mr. J. Lynch

It is not out of character. I referred, when Deputy Corish was speaking, to a description Deputy Norton gave one time of Deputy McGilligan, but since Deputy McGilligan did pore back over previous volumes, I remember him being on record as stating that he, as a member of the Government, was not responsible for the employment of people in this State. There are 500 people employed at this mine and I feel responsible, as Minister for Industry and Commerce, for their employment. It is for that reason, as well as ensuring the viability of this mine, that I have come before the House on a number of occasions and sought further assistance for the St. Patrick's Copper Mines from the House, which has been readily forthcoming.

I am sorry that Deputy McGilligan tried to suggest that something had happened as a result, perhaps, of the advent to office of this Government that made this undertaking less viable than it was when he, as legal adviser to the inter-Party Government of 1954-57, negotiated the agreement with St. Patrick's Copper Mines and when he, as a voting member of the Dáil supporting that Government, supported the legislation that was necessary to execute that agreement. I take it that Deputy McGilligan and his associates at that time were quite satisfied with the bona fides, with the technical ability and with the financial set-up of the company with which he made that agreement at the time.

Certainly, as far as I know, there was nothing that that Government did then in relation to this agreement with that company which was in any way unjustifiable. Certain criticisms were made subsequently by the Taoiseach when he was in Opposition that at the then prevailing prices of copper it appeared that St. Patrick's Copper Mines were getting a very good bargain, and that was true. The price of copper at that time was £430 a ton.

Mr. Norton

For how long?

Mr. J. Lynch

For a very short period. It fell disastrously in the succeeding years to as low as £170 a ton.

Mr. Norton

For how long?

Mr. J. Lynch

Again for a short period but it recovered.

Mr. Norton

It was well within what they promised to do.

Mr. J. Lynch

I shall give the details later on. It recovered to the present price of, roughly, £230, more or less, but it was not only the price of copper but the ore content of the deposits that were being extracted from St. Patrick's mines that caused the difficulties that have now arisen as well as other unforseeable incidents and accidents. I shall refer to these later.

To go back on the history of the mine which I have been requested to give, in the '40's there was a report by a leading British consulting engineer on the mineral deposits in Avoca. Following that report Mianraí Teoranta in 1947 commenced the exploration of the deposits in that area. That exploration continued until 1955 and it cost Mianraí Teoranta, as supplied by the Government, £540,000. It was carried out with the aid of these State funds by Mianraí own personnel and in 1954 a report was prepared, even before the exploration was completed, by Mianraí's own engineer and confirmed by a firm of consultants. That report showed that there were 12 million tons of ore in West Avoca. That quantity was in different places. The main quantities, the major deposits, were in an area known as the South Lode and that was at a level of 1,670 feet below ground. In that lode were some 9 million tons of ore which was assayed as grading one per cent. copper ore. There was a small deposit of 2,700,000 tons of ore in another lode called the Pond Lode, at a slightly lower level in a different area, that is at 1,300 feet. That ore was assayed as grading 1.35 per cent. copper.

After that report and in February, 1955, when the exploration operation was nearing completion, Mianraí advertised the mines as having reserves of some 13½ million tons of ore with its copper content at over one per cent. As a result of that advertisement there were a number of approaches from major companies who were interested in the project and they sent their engineers at different times to examine that report on the deposits at Avoca. During all these examinations and reports there is no evidence available that any doubts were cast on Mianraí's estimates. In 1955 they commenced negotiations with the company mentioned here, Consolidated Mogul Mines of Toronto.

Mr. Norton

Would the Minister confirm at this point that, when the mines were advertised, there were, in fact, no takers?

Mr. J. Lynch

Not for a period.

Mr. Norton

But nobody signed a deal?

Mr. J. Lynch

No. I grant that Deputy Norton, when Minister for Industry and Commerce, perhaps had to seek out a company prepared to undertake the mining lease.

Mr. Norton

I think the Canadians should not be denied some credit for what they have done.

Mr. J. Lynch

I certainly do not intend to deny it to them.

Mr. Norton

Nobody else should do it. Six million Canadian dollars down in the ground at Avoca.

Mr. J. Lynch

It is a great pity Deputy McGilligan did not approach it in that spirit here to-day. A mining lease was granted to St. Patrick's Copper Mines, a subsidiary of Consolidated Mogul, in January, 1956. During the following two years St. Patrick's Copper Mines were actively engaged in the development of the deposits and in the construction of what is described for me as "flotation plant," the object being to commence commercial production. They spent somewhere in the region of £2 million of their own money in that operation.

At that stage, there were certain credit restrictions in Canada, and certainly as far as the flotation of companies or the attraction of investment in any form of undertaking in Canada were concerned, many companies ran into difficulty. So did Consolidated Mogul and so did St. Patrick's Copper Mines. They found they were unable to attract further moneys beyond this £2 million they had already spent and they asked the Government in March, 1958, for certain assistance as a result of which the Oireachtas approved a Supplementary Estimate which provided for the guaranteeing of a £1,368,000 loan to be advanced by an independent Irish source. That was necessary then to enable the development work commenced to be completed so that the mine could be brought into full production.

Before this State-guaranteed loan was given the Government sought and was given a report on the Avoca mine, which was prepared by a well-known investment trust which already had substantial mining interests, including an interest in copper deposits, in various parts of the world. The experts employed by the trust formed a distinctly favourable impression of what was going on at the mine, and so reported to the Government. It was stated that the development work and the construction work at the mine were proceeding in a very workmanlike fashion, and these experts reported in particular that the work at the time was "imaginative, yet sound". As well as that, they confirmed that the estimates of mining and milling costs made by Consolidated Mogul before they entered into the agreement of 1956 were conservative. Therefore, the Government felt justified at the time in coming before the House for approval, and the House approved of the guarantee of this £1,368,000 loan.

In October, 1958, the commercial production was commenced. I might say that initially the commercial production was confined to areas in which Mianraí Teo. had not done any boring. There were areas which were near the surface on which old workings had been carried out. St. Patrick's had, perhaps, their own borings done in that area, but when they started working them they found, first, that the copper content of the ore was not as high as they themselves thought; and, secondly, as a result of these old workings there were a series of cavings-in, and that restricted considerably the output from that area. I am sorry. The cavings-in did not occur then, but lower grade copper than they anticipated was found at that stage. By reason of that, they found that their resources were not sufficient to carry on and they sought assistance again by way of a State-guaranteed loan of £550,000, which was duly approved by the Oireachtas in December, 1959.

At that time, they decided to carry out mining on a more selective basis, particularly in East Avoca, by opening up an area known as Tigroney, where higher grade ore deposits were expected. It was expected at the time that this proposal would lead to the production of higher grade ore which, at the price then ruling of £232 per ton, would enable the company in due time to discharge its liabilities in respect of the two State-guaranteed loans.

During the past two years since the loan of £550,000 was made available to the company, again their prospects as to the grade of copper were not fulfilled. It was in the past nine or ten months that the cavings-in in the old workings, to which I have already referred, began to take place. This, of course, resulted in a considerable reduction in their through-put of ore and reduced the amount of ore extracted per month to 50,000 or 60,000 tons as against the target of 80,000 tons, while operating cost remained at a high level. These two combinations of the lower grade ore and the cavings-in incurred for the company heavy operating losses which ultimately drained away all the company's financial resources.

Before I leave that aspect of it, I should mention that about 90 per cent. of the ores so far extracted in Avoca by St. Patrick's are in areas in which there was no exploration work done by Mianraí Teoranta. The company are only now approaching the area in which Mianraí had proved the existence of major deposits.

Mr. Norton

Before the Minister leaves that point could he tell us how much of this ore was exported, what was its value, whether it was exported as ores or as concentrates? If the Minister has not the information now, it will be all right later.

Mr. J. Lynch

I shall be coming to it later. Deputy Norton did ask other questions, which I think I will deal with as I have noted them. In association with other Deputies, he asked questions about the accuracy of the Mianraí borings.

First of all, I want to say that even though some of the test borings carried out by St. Patrick's in connection with the development work have not corresponded with the borings done by Mianraí Teoranta, that does not prove that Mianraí borings were inaccurate. Mianraí's borings were made here and there, as they are in any mineral exploration work, at intervals over the whole deposits. The cores they extracted were assayed by their own experts and test-assayed in London by a very reputable firm of London assayists. The results were only an indication of what there was in the area, but two boreholes side by side may produce different results. I am told the ore in Avoca is like currants in a cake—a cake well endowed with currants—and that it is quite possible one borehole might miss a currant and that another might strike one.

That is the reason why it is expected some of St. Patrick's borings did not correspond with those of Mianraí Teoranta. The borings Mianraí extracted were in the form of cylinders, which they cut in halves. They sent one half to London for examination by assayists there and they retained the other half so that their extracts were available for testing as being authentic and in no way misleading. St. Patrick's have not yet produced ore from the area in which Mianraí found the larger deposits but at the present time they are carrying out development work by way of tunnelling and by way of the installation of a conveyor belt and a crusher.

Mr. Norton

Is this tunnelling under the river?

Mr. J. Lynch

I am not certain about that, but some of it may be. No; the tunnelling is at present on the far side of the river. The tunnelling is intended ultimately to reach the South Lode and the installation of the crusher and the conveyor belt is expected to be completed by the end of April. It was in connection with that development work that they carried out the preliminary check drilling which proved disappointing. I understand, however, that St. Patrick's check drilling is far from completed and that there is no definite assertion as yet that the final results will not substantiate the Mianraí findings. I should say in this respect that check borings made recently by St. Patrick's at the 1,300-foot level, where there are admittedly smaller deposits than where they are now boring, have confirmed Mianraí estimates of tonnage and ore content.

Mr. Norton

What is the mineral content of the South Lode? Was it not supposed that there would be 9,000,000 tons of mineralised ore there?

Mr. J. Lynch

With the content slightly exceeding one per cent. I am told that after extraction and dilution it would be reduced to 0.9 something per cent.

Mr. Norton

I suppose that is lead as well as zinc?

Mr. J. Lynch

Yes. That question was asked. Deputy Cosgrave asked what minerals other than copper are found. There is of course the by-product of the copper mining, pyrites, but zinc and lead also occur but not in sufficient quantities to make their economic working possible at present prices. I should like to mention now the nitrogenous fertiliser factory. A number of Deputies referred to it. The availability of pyrites is not essential to the success of the nitrogenous fertiliser project. The nitrogenous fertiliser factory committee, which recommended the use of pyrites from Avoca for the manufacture of certain nitrogenous fertilisers, reported that, given a continuity of copper mining in Avoca, the supplies and quality of the Avoca pyrites, as part of their mining operation, would give supplies and quality of pyrites adequate for the sulphur requirements of the proposed factory.

I mention sulphur requirements because the sulphur extract from pyrites would be used only for the production of sulphate of ammonia. It would not be necessary to use sulphur for the production of ammonium nitrate or other forms of ammonia products. In any event, the position is that the nitrogenous company—Nitrogen Éireann Teoranta, was set up to secure a binding tender for the erection of the factory and they are taking steps to ensure that the plant, tenders in connection with which they are seeking, can be converted if necessary, to the use of elemental sulphur for the production of sulphate of ammonia. It was the proposition to base the fertiliser factory on Avoca pyrites because pyrites had a special economic attraction since it was being won with the copper ore from Avoca, but the position is that sulphur may be used instead. The important thing to remember is that, whichever is used, the committee established to examine the setting up of the factory reported that, whether it is sulphur extract from Avoca pyrites or converted sulphur rock, this factory can produce nitrogenous fertiliser economically for the farmer, without subsidy or protection, at prices which compare favourably with current import prices.

Mr. Norton

Does the Minister say that they do not contemplate processing pyrites for the home or export market?

Mr. J. Lynch

As far as I know they do not. They were in consultation with Nitrogen Éireann Teoranta and expect to sell to them quantities of pyrites which they would process, the cinder of which would be extracted and sent to St. Patrick's for disposal by St. Patrick's otherwise.

Mr. Norton

I think it is a change from the earlier plan.

Mr. J. Lynch

I do not think it is a change.

Mr. Norton

They discussed with me the possibility of finding markets in Europe for the sulphur and felt that relatively small quantities would be used here.

Mr. J. Lynch

I am not familiar with the terms of these discussions. The first I heard about the processing of pyrites was in connection with the nitrogenous fertiliser plant. I am now reminded that they do export pyrites, but not processed pyrites.

Mr. Norton

In what quantity, so far, and what is its value?

Mr. J. Lynch

I shall come to that again. In summing up this aspect of my reply, I should say that a substantial part of the production envisaged at the nitrogenous fertiliser factory at Arklow will not be affected in any way by the possible failure of production of pyrites at Avoca. I mentioned already, I think, that sulphur comes from pyrites and is used only for the purpose of manufacturing sulphate of ammonia and not for the manufacture of ammonium nitrate, or other forms of ammonia, used for fertiliser purposes.

While Deputy Dillon was speaking, I mentioned what the expenditure was, on one side and the other, on the copper mines to date. The figures to date are £1,368,000, plus £550,000, making something short of £2,000,000; and the expenditure from moneys invested by Canadian sources is of a similar amount, almost exactly £2,000,000.

Mr. Norton

Was there any repayment in that sum out of the £1.3 millions they got in 1958?

Mr. J. Lynch

There was repayment of interest but not of capital. In the context of the financial assistance given, I forgot to mention that in October 1947 there was a trade loan of £350,000 and in January, 1959 there was another trade loan of £100,000. Each of these was consolidated in the subsequent State guaranteed loans and, therefore, these are not additional and were, in fact, repaid out of the guaranteed loans subsequently given.

Mr. Donegan

The nett figure is £2,000,000 guaranteed, plus this £240,000.

Mr. J. Lynch

Yes. Someone asked about the technical ability of the operators. From the reports I have received, I am satisfied that the best technical skills available are being used. I take it that the Government in 1956 satisfied themselves as to the technical capacity at that time. Monthly reports are submitted to me, together with reports by the Director of the Geological Survey, so that month by month we have a report of the output, of activities generally, and of income by way of sales of copper ore and pyrites. These reports are offically commented upon and the Minister is thereby kept fully in the picture.

As far as the appointment of the director is concerned, under the conditions of the trade loans and of the subsequent State guaranteed loans the Minister has power to appoint a director. So far, we have not exercised that power.

Coming to prices—these were raised, in particular, by Deputy Norton the last day—the price quoted on the London Metal Exchange stood at over £250 a ton during the first half of 1960. I am referring now to copper prices. The price dropped to between £220 and £230 in the latter part of 1960. During 1961 prices generally were in the region of £220 to £230 per ton. There has been a slight increase recently. The last quotation I have is the price on the 16th instant—£234 per ton.

Mr. Norton

They are not uneconomic prices.

Mr. J. Lynch

No. At the ore content envisaged and proved by Mianraí Teoranta it is not an uneconomic price.

Mr. Norton

There is the basic problem of getting the copper out of the ore.

Mr. J. Lynch

As far as the value of production is concerned I have some figures that may help Deputy Norton. The financial accounts of the company are, of course, published and laid on the Table of the House. We have reports for the years ended 31st December, 1958, 1959 and 1960. The production of copper concentrates in the two months of production ending in 1958 was £103,194 and £10,500 for pyrites. In 1959 the figure for copper was £841,731; copper concentrates £950,196.

Mr. Donegan

That is gross. Are there any expenses in those figures?

Mr. J. Lynch

The expenses are contained in the published accounts.

Mr. Norton

They are quite nice exports, if they could get a good copper.

Mr. J. Lynch

The exports for the three years of both copper ore and concentrates are as follows: in 1959 the value was £836,659; in 1960, £1,103,200; in 1961, £809,991. I have not got the figures for pyrites. They are not published. The export of pyrites is rather intermittent. It is difficult to get markets abroad. At the moment there are 11,000 tons in stock.

On the general question of the future of the mine, I am, as I said, satisfied that the best technical skills are being used to make this mine economic. The present difficulty arose largely because of the low ore content in the workings near the surface that Mianraí Teoranta had not surveyed and the cavings-in which occurred in the early months of 1961. As soon as the new development work gets to the wider deposit in the South Lode, where 9,000,000 tons of ore have been proved exceeding 1 per cent. in ore content, there is a good chance that production of copper of an economic ore content will increase. The company are doing everything possible to achieve this development and get at this lode as quickly as possible.

Originally, when they sought State assistance, the suggestion was made that they could carry on with production. Because of the low ore content and the limited amounts of ore, they were able to extract, they found they were losing some $50,000 to $60,000 a month. To continue on that basis would be very uneconomic and they later suggested they should concentrate all their efforts, with the aid of this £240,000, on development alone. That would mean the laying-off of some couple of hundred men—electricians, mechanics, and so on.

I asked the company to continue with production and not to decide to lay off men, unless that was absolutely necessary. They decided to do that and it is on that basis I am coming before the House. It may not be possible for them to go ahead with development work and to continue making losses on the basis of full production, but if they decided to lay off men again, I have asked the company to make the lay-off as limited as possible and for as short a duration as possible.

Mr. Norton

On the question of capacity to produce, is it not true that the flotation plant they have there is about the best in Western Europe?

Mr. J. Lynch

I am afraid I cannot give any information on that.

Mr. Norton

They have certainly done their best to process the copper they can get. I have never seen a flotation plant like it.

Mr. J. Lynch

The suggestion was made there might be more money coming from the parent company, by way of investment from Canada. The Government have interests in this mine to the extent of £2,000,000 in State guarantees. Were it not for that interest, the company would, if guided purely by commercial principles, concentrate on development work only which would necessitate this lay-off. It was in deference to the Government's wishes that they did not propose to proceed with that, unless it was absolutely necessary and they could not find more equity, more investment capital from Canada or from some other source in the meantime. I think the operations there, having regard to the findings of Minaraí Teoranta, having regard to the investment already made in it, are worth pursuing and I believe in the end will prove economic, viable and worthwhile.

Vote put and agreed to.