Dáil Éireann debate -
Wednesday, 20 May 1970

Vol. 246 No. 11

Adjournment Debate. - Whiddy Island Oil Terminal.

Mr. Donegan

I am raising this question on the Adjournment having asked several questions in relation to whether a port authority should have been established at Whiddy Island and port and tonnage dues levied on ships coming there with their cargoes of crude oil.

I asked a question on the 8th April, 1970, which was answered by the present Minister for Industry and Commerce, Deputy Lalor, for the Minister for Transport and Power. At column 976, Volume 245, of the Official Report he replied:

Under international usage no payment may be exacted from shipping for the use of territorial waters and anchoring therein except in consideration of special services rendered.

This right does not apply to internal waters which include bays and natural inlets of the sea such as Bantry Bay. Under the Maritime Jurisdiction Act, 1959, however, the right of innocent passage for foreign ships in those areas of our inland waters which had previously been considered part of the territorial seas or of the high seas is preserved.

I want to say, first of all, that there is no question of the Maritime Jurisdiction Act, 1959, raising any question at all of anchoring or the discharge of goods. As far as I can see, section 5 of that Act refers merely to the free passage of innocent ships, ships that are carrying normal merchandise or passengers which were entitled to pass through these waters before regulations were prescribed or a base line defined under this particular Act. It has nothing whatever to do with the docking of a ship, the unloading of a ship, the transfer of goods on to Irish soil or the transfer of goods from Irish soil, or passengers, in any one way. That disposes of the reference to the Maritime Jurisdiction Act.

I would also refer the House to replies given to me on February 26th, 1970. I want to stay completely in order and, therefore, I am reverting to the fact that in the reply to the question of April 8th I was told that no port dues could be levied. The Minister for Transport and Power on February 26th answered his own questions, and made it quite clear that any natural advantages held in a harbour or outside a harbour by a State, and by this State in particular, could not be a reason why port or tonnage dues could be levied. I quote from column 1809 of Volume 244, of the Official Report:

Mr. B. Lenihan: That is in respect of the lease of the foreshore to the company concerned. Dues are collected by harbour authorities in respect of installations, which they have provided. The installations, in this case, at a cost of £10 million have been provided by the company themselves.

At column 1810 Deputy Lenihan says:

At the risk of repeating myself, may I say that harbour dues in every country in the world, including Ireland, are in respect of facilities and installations provided by a harbour authority for the benefit of firms using that particular harbour area and dues are collected in respect of such usage. In this case, all the harbour facilities were provided by the company concerned at a cost of £10 million. What we are talking about, in terms of a rent, is rent in respect of virgin land under the Foreshore Act which was made available to this company.

That refers to the nominal rent of £7,000 a year for the foreshore at Whiddy Island.

I want to take as my main point the fact that harbour dues are charged in this country on the anchoring of ships and the discharge of goods where nothing is provided but natural facilities. I want to quote from the publication laying down tonnage rates and goods rates levied by the Dublin Port and Docks Board in respect of vessels and goods in the harbours of Dublin. Skerries, and Balbriggan, dated 1st October, 1958, which I understand is still in use except for changes in the actual rate in pence or shillings for the tonnage rate on the goods or the tonnage rate on the ship. The special rate which refers to the anchoring of a large vessel not alongside and where no dredging was ever done—because no dredging could be done in an area which on the chart gives a depth of as much as 50 or 60 fathoms or 300 feet—is at Part III—Exceptional Tonnage Rates—C.:

Any vessel which for the purpose of landing and/or embarking passengers and their personal luggage and/or mails only enters within the limits of the Port of Dublin but does not enter the River Liffey or make use of the quays or wharfs of the port and

(a) does not load or discharge cargo (other than motor cars which are accompanied by their owners as passengers)... ... ¼d per ton.

That is on the tonnage rate of the vessel, not on the goods because there are literally no goods, less than 10 tons and

(b) loads or discharges cargo not exceeding 10 tons inwards and/or 10 tons outwards (in addition to such motor cars as aforesaid) ?d. per ton.

This is in respect of where less than 10 tons is unloaded. Where large quantities of goods were unloaded, in this case from within the Port of Dublin, at a place where nothing but natural facilities were provided, as far as I can see from this booklet, if the full tonnage rate on the goods was not charged, a reduced charge would be made. I would say the charge would be reduced because of the fact that people would have to use lighter or smaller ships to transfer the goods to a position along the quays.

At Cork, where the Queen Elizabeth and various other huge passenger ships call but obviously do not enter the Port of Cork but anchor instead outside Cork, there is also a special tonnage rate. Of course, at that point, where those large vessels put down their hooks the position is that there never was dredging because one cannot dredge a depth of 50 or 60 fathoms any more than one can dredge a depth of 26 fathoms on the installation at Whiddy Island. I understand that at Cork, in the case, say, of the Queen Elizabeth calling and 20 or 30 passengers getting off and their luggage, a nominal amount of three-farthings per ton on the tonnage of the ship is charged. One might think that is a small amount but a net tonnage charge of three-farthings on the Universe Ireland would cost precisely £400.

I now move to the position in relation to the Cork County Manager and what he feels should happen in relation to Whiddy Island. I would refer first of all to the fact that the Cork County Manager is the manager of, I think, the largest county in Ireland—certainly one of the most important.

Dr. O'Donovan

One-eighth of Ireland, William O'Brien said.

Mr. B. Lenihan

The Deputy has very good historical memory.

Mr. Donegan

The Minister does not want to listen to me for the next 13 minutes.

Mr. B. Lenihan

Not at all; we love the Deputy. He obviously loves himself.

Mr. Donegan

It is one of the most important county managerships there is and he was the youngest county manager ever appointed and is regarded as a man of the highest integrity and of great ability. I should like to quote from the Irish Independent of March 16th, 1970, page 5:

The Cork County Manager, Mr. Michael Conlon, wants the Department of Transport and Power to establish a harbour authority for Bantry Bay and to develop the pier, which he described as "dangerous".

A spokesman for Gulf Oil, which employs 100 local men at the oil terminal, said the company was willing to pay harbour dues if a harbour authority was established——

That is a very salient paragraph.

——Mr. Conlon wants an authority so that anti-pollution measures can be taken in the bay. He says: "I believe that we should have some physical means of stopping and controlling oil pollution. Milford Haven has two or three tugs on constant stand-by to deal with pollution on the spot. Taking measures after pollution has occurred is not much good.

The County Council's jurisdiction should be extended in Bantry Bay. This would mean payment of harbour dues, but Gulf Oil would, as users of the Bay, have large representation on the harbour authority and so would be protected from any excessive charges.

More would be involved than money. The existing facilities at Bantry pier are completely inadequate and, to my mind, dangerous. I feel a considerable capital sum should be spent on Bantry pier by the Government, and that the Cork ratepayers should not have to shoulder the cost."

The point I want to make is that he says that an authority should be created and that port and tonnage dues should be levied.

Now I want to deal with the position of port dues. As far back as Christmas, 1968, I addressed a question to Deputy Erskine Childers who was then Minister for Transport and Power. He felt he should not answer and then replied to me by letter, being one of our more courteous Ministers:

10 Nollaig, 1968.

Dear Deputy Donegan,

You recently addressed a Dáil question to me about the gross registered tonnage of the Universe Ireland, which was ruled out of order by the Ceann Comhairle on the grounds that the subject matter of the question did not fall within my responsibilities. In the light of your interest in the matter I have, however, had enquiries made of the shipowners, who have advised me that the figure is 149,608 tons, according to the certificate of tonnage issued in the vessel's country of registry, Liberia. I am also informed that the net registered tonnage of the Universe Ireland is 128,257 tons.

If the facility in respect of ten tons and a few passengers in Cork were afforded to this company in respect of the boat itself, the position would be that the net registered tonnage, that is, the space in which goods can be carried, making allowance for engine room and the rest of it, in the prescribed formula would cost, at three-farthings a ton £400 per trip. I understand that there are six vessels, 312,000 tons of oil being carried in each vessel. I would refer the House to the question I put to the Minister for Transport and Power on 21st November, 1968, in reference to the port and tonnage dues in the various ports for crude oil, heavy fuel oil, petroleum oil and so forth. I do not want to weary the House by quoting. I have not the time anyway.

Mr. B. Lenihan

The Deputy can weary away.

Mr. Donegan

I am not in the least personal about this. I pointed out that the Minister and the Government are throwing away £1 million a year and I intend to prove it. The range of goods rate per ton in Cork is from 4s 1d to 6s 6d for fuel oil other than paraffin and petroleum, 6s 6d in the case of crude oil, and light and medium fuel oil, 3s 3d. If Gulf Oil have spent £10 million they should get a very good reduction and I propose that a minimal figure of 1s per ton should be levied. This would cost £15,000 per ship or £96,000 per round trip of the fleet of six ships. I do not know how many trips in the year they would do. I have studied some of the magazines in this regard—Petroleum Times is one —and I just do not know the length of time it takes to travel the 11,000 miles from Kuwait to Bantry, but I would think, taking into account a period of, say, two months in dock for repairs and maintenance in each year, and something more than ten trips of the fleet, my figure of £1,000,000 lost per year is not too far wide of the mark. I do not think I have been extravagant in suggesting a figure of 1s per ton. In the Petroleum Times of November, 1968, which was the issue that dealt with the advent of Bantry they say at page 1715 that they would have no objection to paying port and tonnage dues if an authority was set up at Bantry Bay.

I do not know what covert arrangement or what discussions took place between Government Ministers and Gulf Oil. I do know that in Milfordhaven they are spending £12 million in order to accommodate ships with a two-thirds draught and half of this £12 million is being subscribed by three oil companies, BP, Esso Petroleum and Texaco, and the information I have is that it is proposed to charge full port and tonnage dues.

I am not suggesting that full port and tonnage dues should be charged at Bantry, but there is no reason why, as I suggest, the Government should lose £1 million a year in this way. There are only two places in the world where these ships can load and unload their full cargoes. Having unloaded, if they want one-third off their tonnage, they can load at Rotherdam and, when Milfordhaven is completed, they can go there. Those are all the places to which they can go in Europe. In Kuwait in order to load the oil they had to create an island ten miles out at sea and to run a 48-inch pipeline under water for ten miles. Having done that they were able at an enormous expense to get this vast quantity of oil into this huge channel and transmit it to the only natural place where it could be off-loaded, first of all by tankers, on Irish soil at a minimal figure of £7,000 a year and then pumped out into small tankers and despatched to the various places all over Europe.

At Scotsman's Bay—in case anybody does not know where it is, it is outside Dalkey Island, where the Coronia and other large vessels have come in—tonnage and port dues are charged even though such vessels would merely call to disembark tourists or allow them three days in Ireland and go away again. When the Queen Elizabeth or other such ships called at Cork port dues were levied on the registered tonnage of the vessel. Therefore the Minister's statement that no charge should be made because it was only man-made facilities that guaranteed the right to make a charge has been negatived by the fact that at Cork and Dublin where there are no man-made facilities provided port and tonnage dues are charged. There is a preferential rate but the point is that a rate is charged. Gulf Oil are prepared to pay and I have suggested a minimal figure which could not affect their operations one way or the other, and this figure adds up to £1 million per year.

Minister for Transport and Power (Mr. B. Lenihan)

I should like, first of all, to get this matter into a context of reality. Deputy Donegan has embarked on a euphoric investigation in this regard, but there is no comparison whatever between the situation arising in a completely virgin harbour area such as Bantry Bay, where nobody wants to go and where nobody ever had any plans to go, apart from the particular project that went there by reason of Government encouragement—there is no comparison between that sort of situation and the sort of situation that is involved in established ports like Cork, Dublin, Liverpool, Antwerp— call it what you like.

Deputy Donegan is putting things in an entirely wrong context in seeking to get a comparison between ports such as the established ones I have mentioned and the Bantry Bay situation. The Bantry Bay situation was roughly this—and let us face up to it—that you had a completely naked foreshore, no installations, no harbour authority, an open area——

Mr. Donegan

Twenty six fathoms.

Mr. B. Lenihan

——nobody inquiring apart from these people. In the interests of Ireland and that particular area of Cork the Government decided to allow this investment of £10 million, which took place, with the substantial employment that took place in the course of construction of this terminal and the 147 people who were permanently employed there and the £7,000 income derived from the Foreshore Act by way of rent from this operation. It is as simple as that and if you did not have them there you would have nobody there.

So that all the paraphernalia of verbiage we have had from Deputy Donegan disappears when one considers this naked fact and the sooner people in this country come down from a state of euphoria and to a state of reality the better. If Gulf Oil did not establish their terminal there, nobody else was likely to do it. Indeed, we have a very parallel example of this type of euphoria at the moment in regard to the Shannon Estuary itself. We have very successfully developed the Shannon Free Airport area because of the wisdom in establishing the airport at Shannon which has given rise to the need for the development of industries associated with air freight. But despite the fact that the Shannon Estuary is equally with Bantry Bay an excellent estuary in the simple sense of being geologically and geographically an excellent estuary, it has not attracted any industry at all, despite many endeavours by many operators and many entrepreneurs over many years and with a guarantee of any Government assistance that would be available provided the projects stood up. Similarly in regard to Bantry, bringing the thing into perspective, Bantry Bay would be Bantry Bay with nothing were it not for the fact that this particular oil company thought that this was in their interests. Mark you, we did a very good deal to get them there, to put the investment in, to establish the employment—it is not extraordinary employment—to establish permanent employment apart from the investment they made in it initially in the construction and the further ancillary investments in regard to amenities in and around Bantry. One cannot go into details but they are doing it.

What I understand is that if we do not encourage people to do this sort of thing we can throw our hat at all investment in this country. The very same sort of argument may be used against establishing an ore smelter here, or to establishing any type of industrial development here. In fact the very argument used by Deputy Donegan—I want to strip it of the verbiage and the small town lawyer detailed sort of argument and get down to fundamentals——

Mr. Donegan

I am no lawyer. The Minister is a lawyer.

Mr. B. Lenihan

I refer to cheap lawyer stuff. If the Deputy were a lawyer he would not make that sort of argument. Stripped of all its nonsense, fundamentally, it comes down to the sort of argument that went on back in the 1930s, 1940s and 1950s against any progressive development here. The very same argument was used in this House by a leader of the Fine Gael Party— not the leader at the time but a former leader of Fine Gael, who was not then a leader—in regard to the whole Shannon Airport Development.

Mr. Donegan

Get back to Whiddy Island.

Mr. B. Lenihan

I do not want to go into the old argument about what Deputy Dillon said. We will leave it at that. Whiddy Island, I may say, is in the very same context. If Deputies are honest with themselves, they will see it. Here is a situation where there is not a developed port at all; there is a completely open area of seaway that is available to a particular developer who is willing to give practical investment in terms of £10 million, who is willing to stay there in the form of investing further sums in Bantry and the area round it and is giving permanent employment to a certain number of people, and further employment in regard to its construction, and with whom at the present point of time—and this shows the destructive aspect of Deputy Donegan's approach—I am negotiating and my colleague, the Minister for Industry and Commerce, is negotiating for further industrial development of a substantial kind in this country. If you are going to have this sort of negative destructive approach then we will get nowhere.

All I am saying is that we have done fairly well in this particular operation. We are going to do better—not just in Bantry itself but elsewhere—and if we adopt a constructive, progressive, optimistic approach towards investment on the part of people like Gulf Oil and other people of that kind this country will develop as it has developed due to our operations since 1957. It has developed a good name in regard to industrial investment, a good name as a country of economic development. As long as we continue that constructive approach we will make progress. Many Deputies, some of them deceased, of the Fine Gael Party and one deceased of the Labour Party—Deputy Norton—I am referring particularly to Deputy Sweetman of the Fine Gael Party, with whom I had, not in the capacity of Minister for Transport and Power, but as a Deputy and a Senator, very constructive discussions on how this development should take place—if they were here on these benches at the moment they would subscribe totally to the point of view I am adumbrating.

Mr. Donegan

The Minister is safe —God rest them, they are dead—but it is a poor argument.

Mr. B. Lenihan

Deputy Donegan knows that one thing those highly progressive people, both in the Labour Party and the Fine Gael Party, who helped Seán Lemass and helped Fianna Fáil by pursuing the same policies while they were there in positions where these policies could be continued—one thing they always emphasised was that nothing should be done by this country in any way to denigrate, to take from, any form of external investment that could come in here and could place its confidence in the future of this country by investing in it and I would charge Deputy Donegan with doing a very destructive act in this particular case. I am not going to go into the details of argument in regard to particular ports——

Mr. Donegan

The Minister cannot.

Mr. B. Lenihan

I can answer him very quickly—because in regard to developed ports such as Cork and Dublin that he quoted this has obtained but I certainly do not see the relevance of his particular argument in regard to areas of this country, be they Bantry Bay or any other bay in Ireland. I do not see the relevance of his point in regard to these areas that we want to develop from the ground up. The argument is totally irrelevant. It does not arise at all because here we are developing areas that were never developed and certainly while I would welcome the participation of the Cork County Council—and I might say the County Manager, Michael Conlon, is a very good friend of mine; I went to school with him and we exchange all confidences— this is one matter on which we have a gentleman's agreement to disagree.

Dr. O'Donovan

Is there no truth in the story that a Minister of this country in a fit of euphoria after dinner gave a promise to the Mellons of Pittsburgh, these shrewd people of north of Ireland extraction, that he would give them this concession in Bantry?

Mr. B. Lenihan

No truth whatever. The first I heard of it.

Dr. O'Donovan

I have no connection with business and I heard it.

Mr. B. Lenihan

Probably some germination of the Deputy's imagination.

Dr. O'Donovan

Not at all. The Mellons of Pittsburgh——

An Ceann Comhairle

The Minister has two minutes.

Mr. B. Lenihan

In this House Fianna Fáil have met this sort of attack over the years. You either have development or you do not have development. If you do not have development you leave Bantry Bay as it is and every bay around Ireland as it is. You have no development in Tynagh, no development in Shannon, you have no development anywhere in Ireland. You just forget about it and say "no" to anybody who comes in because you do not like the colour of their eyes.

I say that we must go out and make arrangements, make agreements, encourage people in and recognise that Bantry Bay is not Antwerp, is not Rotterdam, and we must be very realistic and recognise that Bantry Bay was a completely naked waterway until we got this development into it and there is absolutely no comparison and no use in trying to equate a harbour authority for Bantry Bay with a harbour authority——

Dr. O'Donovan

Gulf Oil equal Mellon; Mellon equal Gulf Oil— equation.

Mr. B. Lenihan

Before I was interrupted I wanted to assure the House of one matter; I would be delighted if I saw the slightest reason in the world for it but at the moment I do not see any reason for it and it would be a superfluous imposition of administration to set up a harbour authority. If I saw the slightest reason for it in the way of another interest coming into Bantry Bay—and I would welcome another interest and every effort that we are now putting into it through all the agencies available to the State is being put into seeking to encourage some other interest into the Bantry Bay area—and if we could get them into it then we would have a harbour authority in the form sought by the Cork County Council but at the moment the only people who have sought to be there are Gulf Oil Company, Ltd.

Mr. Donegan

And made a bargain —less than £1 million a year.

Mr. B. Lenihan

The fact is that right around Ireland we have admirable esturial areas, admirable harbour space available but, unless we get these specific projects up, we can do nothing about them and there is no point in talking hot air or trying to compare Bantry Bay or any other estuary in Ireland with other areas throughout the world. We have to live within our means and get what we can and make the best deal that we can make within the context of what is good for us and good for the people with whom we make reasonable agreements from a business point of view. That is practical business and that is the only way to operate in this type of situation.

The Dáil adjourned at 11 p.m. until 10.30 a.m. on Thursday, 21st May, 1970.