My Department maintains contact on an ongoing basis with the Department of Economic Development in Northern Ireland in relation to matters of mutual interest. As energy markets are opened to competition in accordance with the European Union single market programme it is inevitable that there will be an increasing integration and interdependence between the energy markets north and south.
It was for this reason that the Department of Economic Development in Belfast was invited, in an observer capacity, to participate in the study carried out by my Department and Bord Gáis Eireann in relation to the infrastructure options to meet future gas demand until 2025. This "Gas 2025" study considered a number of gas supply options and concluded that the optimal solution on cost and other grounds for the future incremental supply of the northern and southern markets with gas from or through the UK would be to replicate the existing Moffat-Loughshinny pipeline without incorporating a North-South link.
An economic analysis subsequently commissioned by my Department of the various Gas 2025 options also had regard to the changing circumstances since the Gas 2025 study was launched, in particular developments in relation to the Corrib field and a proposal for a Belfast/Dublin gas pipeline. This analysis confirmed the findings of the Gas 2025 study but concluded that a commitment should not be made to future infrastructure pending further clarification of the potential of the Corrib discovery. Supply constraint considerations will require that key decisions be taken next year. The report of the economic analysis and other relevant material is on my Department's website.
The potential impact of Corrib is dependent, in the first instance, on the actual size of the discovery and, in the second, on a decision by the owners on the means by which the field will be developed commercially. This will require clarity in relation to the possible landing points and pipeline routing options. It is premature to say whether a north-south link might be an economic prospect as a part of any new pipeline configuration required to exploit the discovery.
It is my understanding that a third appraisal well will be drilled in the Corrib field early next year before a decision will be taken on the commercial development of the field. In circumstances where this decision has not yet been taken, I have to look upon suggestions that the field could meet up to 50 per cent of the total demand for gas until well into the next century as an exciting prospect but unduly speculative as a basis for a formal bilateral initiative of the kind envisaged by the Deputy.
My Department and the Department of Economic Development in Northern Ireland will continue to maintain close contact in this matter. I am open to meeting my Northern Ireland counterpart, as necessary, in this matter.