Theresa Ahearn
Question:19 Mrs. T. Ahearn asked the Minister for Energy the progress, if any, which has been made in his plans to secure the upgrading of the facilities in Whitegate; and if he will make a statement on the matter.
Questions— Oral Answers (Resumed). - Whitegate Oil Refinery.
Joe Sherlock
Question:59 Mr. Sherlock asked the Minister for Energy the Government's proposals for the future development of the Irish National Petroleum Corporation; if any further progress has been made with regard to finding a possible partner for the development of the Whitegate Refinery and the Whiddy Island storage capacity; and if he will make a statement on the matter.
Peter Barry
Question:68 Mr. Barry asked the Minister for Energy if his Department, or the INPC are in discussions with either individuals or institutions regarding Whitegate Oil Refinery; if so, the stage these discussions are at; and whether the upgrading of the refinery will commence in 1993.
Jim O'Keeffe
Question:99 Mr. J. O'Keeffe asked the Minister for Energy the reason no progress has been made in re-activating the oil terminal on Whiddy Island, County Cork.
I propose to take Questions Nos. 19, 59, 68, and 99 together.
My Department and INPC are continuing to seek a partner for investment in the refinery and Whiddy terminal with the objective of achieving commercial operation.
The discussions with a specific party in relation to Whitegate to which I referred earlier this year, have not produced a satisfactory outcome. As soon as I realised that these talks were not likely to produce agreement, I decided to widen the scope of our search. INPC have, therefore, in conjunction with my Department, employed a leading adviser on merger and acquisitions in the European energy sector and particularly the oil industry to assist in identifying and negotiating with an investor/partner to invest in upgrading Whitegate and achieving commercial operation there.
In relation to the Whiddy terminal, while every effort is being made to attract suitable investment which would enable its full reactivation, no realistic proposal has emerged to date. However, over 200,000 tonnes of crude oil were placed there in late 1990. Furthermore, extensive refurbishment work costing £1.88 million, and for which the EC has agreed to contribute 50 per cent, has been carried out over the past 18 months and is nearing completion. This work will make the facility more attractive for investment.
The Minister's reply is very disappointing. What happened to the finance raised from the sale of Tara Mines two years ago? It was then indicated that this money would be used to upgrade Whitegate. Why has this not been done? Is the money still earmarked for Whitegate? Will the Minister also indicate the cost to the economy as a result of the delay in upgrading Whitegate?
It was estimated by the Fair Trade Commission some years ago that the diseconomy involved amounted to less than 2p per litre in the case of petrol and diesel, about £10 million per annum. A Government decision is still in existence in regard to how the money obtained by the State on the sale of Tara Mines would be utilised. The decision was that the moneys available would go towards the cost of carrying out an upgrading at Whitegate if and when such a decision was made. I have indicated that the intention is to seek a joint investor — or an investor who may be interested in a substantial part of the plant — to contribute to the cost of carrying out this upgrading.
The State's contribution, as determined by the Government decision, will be at least the $25 million which was then determined to be available. However, the ongoing discussions to date have been disappointing because positive proposals have not emerged in the discussions we have had with different interested parties which I felt I could recommend to the Government or to this House. In respect of whatever joint ventures were entered into, the House would expect me to ensure an equal sharing of the risks involved as well as any benefits derived from such an investment. Until such a proposal is negotiated I shall not be in a position to come back to the House on the matter.
Further to the Minister's reply, can he tell me when the new people were appointed to give him advice on this issue and when he expects to receive a report from them? Can he give an assurance that no jobs at the Whitegate enterprise are under threat due to the delay in the upgrading of facilities there?
There is certainly no immediate threat to any jobs in the Whitegate facility. In fact, the purpose of my actions and my intent in this matter is the opposite. I am seeking to ensure the continuation of the Whitegate operation and thereby ensure the security of employment at that facility. The international firm of consultants were appointed some months ago — and I could provide the Deputy with the exact date if that is required — and I expect them to report to me either late in December or early in January.