Dáil Éireann Debate, Thursday - 19 July 2012
459 Deputy Bernard J. Durkan asked the Minister for Communications, Energy and Natural Resources if he is satisfied that supply from the Corrib gas field will become available on time to assist with economic recovery; and if he will make a statement on the matter. [36875/12]
View answerIreland's fiscal terms are tax based and the return to the State is linked directly to the profitability of an individual oil or gas field. Profits from petroleum production arising from exploration licences granted prior to 2007 are taxed at a rate of 25%. The direct financial return to the State from the Corrib gas field will be through the 25% tax on profits. The level of profits from the Corrib gas field will depend on a combination of factors including, the volume of recoverable gas, the cost of developing and operating the infrastructure, the price of gas over the life of the field, together with the timing and profile of production.
Completion of the Corrib gas field development works by the developer is the principal factor that will determine the date for first gas. Pending such completion, it is not possible to state a date for when gas from the Corrib gas field will become available. It is estimated that construction of the onshore section of the pipeline, including the construction of a 5km tunnel, which began last year, will take in the region of three years. First gas cannot therefore reasonably be anticipated before 2014.
The Corrib gas field will also strengthen Ireland's security of energy supply and at peak production will provide approximately 60% of Ireland's annual gas needs. The Deputy might also like to note that during its development phase the Corrib Project has contributed significantly to creating employment in the Erris region.
