Petroleum and Gas Exploration

Questions (98, 112)

John Halligan

Question:

98. Deputy John Halligan asked the Minister for Communications, Energy and Natural Resources in view of the recent oil/gas find in Ballyroe, County Kerry and the possible find off the coast of Northern Ireland and the evidence this provides that significant gas and oil deposits exist in Irish waters, if he is considering changes in the licensing and tax regime surrounding gas and oil exploration; and if he will make a statement on the matter. [9989/13]

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Richard Boyd Barrett

Question:

112. Deputy Richard Boyd Barrett asked the Minister for Communications, Energy and Natural Resources in view of the recent oil/gas find in Ballyroe, County Kerry and the possible find off the coast of Northern Ireland and the evidence this provides that significant gas and oil deposits exist in Irish waters, if he is considering changes in the licensing and tax regime surrounding gas and oil exploration; and if he will make a statement on the matter. [9988/13]

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Written answers (Question to Communications)

I propose to take Questions Nos. 98 and 112 together.

I assume the Deputies are referring to the Barryroe oil discovery off the coast of Cork and to recent media reports relating to the potential of the Rathlin Basin offshore Northern Ireland.

The results from the appraisal well drilled last year on the Barryroe discovery were encouraging and are the first significant flows of oil on test offshore Ireland in thirteen years. However, more work, including additional appraisal drilling, will be necessary to determine if the discovery, which was originally made by Esso in 1973, can be declared commercial and progress to a petroleum production project.

In relation to recent media reports on the potential of the Rathlin Basin, I understand that these reports relate to an initial resource assessment of a prospect that has yet to be drilled. As this area is outside the jurisdiction of this State I have no function in the matter.

While there has been a modest but welcome upturn in the level of interest in exploration off our coast in recent years, the reality is that the only commercial discoveries of hydrocarbons made in the Irish offshore to date are the three producing gas fields in the Kinsale area, along with the Corrib gas field, which was discovered in 1996. There have been no commercial discoveries of oil.

Despite the low level of commercial discoveries to date, working petroleum systems are known to exist in many of Ireland’s offshore basins, as demonstrated by a number of non-commercial discoveries as well as other oil and gas indicators such as hydrocarbon shows in wells. Nevertheless, the oil and gas potential of the Irish offshore is largely unproven and is likely to remain so until there is a significant and sustained increase in the number of exploration wells being drilled from the current levels of 1 to 2 wells per year.

To this end my Department encourages exploration investment through an active and targeted promotion campaign, regular licensing rounds and by supporting petroleum research projects that deepen knowledge of the petroleum potential of the Irish offshore. Maintaining an appropriate fiscal regime is also critical to attracting this much needed exploration investment to Ireland.

Ireland’s tax terms for oil and gas production are deliberately aimed at attracting new investment and are set at a level comparable to countries such as France, Portugal and Spain, who, like Ireland, have limited petroleum production and with whom we compete for exploration investment.

The Deputies will be aware that I welcomed the publication by the former Joint Committee on Communications, Natural Resources and Agriculture of its report on Offshore Oil and Gas Exploration. The report will contribute to the debate on how best to maximise the benefits to Ireland from the exploration and production of our indigenous oil and gas resources. I have already had the opportunity to discuss the report in the Seanad and I look forward to discussing the report in the Dáil in the not too distant future,

Energy Prices

Questions (99)

Bernard Durkan

Question:

99. Deputy Bernard J. Durkan asked the Minister for Communications, Energy and Natural Resources the extent to which he and his Department directly or in conjunction with the Regulator have endeavoured to ascertain the extent to which petrol and diesel prices at filling stations accurately reflect oil prices on the world markets throughout each of the past six years to date; if he will set out the prices charged per barrel throughout the period in question; the prices charged at filling stations in the same period; and if he will make a statement on the matter. [9955/13]

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Written answers (Question to Communications)

Neither I nor the Commission for Energy Regulation has a statutory function in the regulation of petrol and diesel prices.

The Irish oil industry is fully privatised, liberalised and deregulated and there is free entry to the market. There is no price control and it is Government policy to encourage price competition and consumer choice.

The upward trend in petrol and diesel prices arises primarily from increases in international commodity prices over which Ireland has no control. For example, the benchmark spot price of a barrel of Brent Crude Oil has risen from an average of US$58 in February 2007 to an average of US$117 in February 2013. This has inevitably resulted in an increase in retail petrol and diesel prices.

Previous surveys have shown that prices charged by Irish retailers for oil products relate to the refinery price rather than to the price of crude oil. Prices at the pump reflect volatile market prices, transportation costs, trends in euro/dollar exchange rates and other operating costs, together with the impact of taxation on oil products.

The EU Market Observatory publishes an Oil Bulletin with current and historical oil product prices for all EU countries. As of February 11th 2013, the price of petrol in Ireland was marginally below the EU average; while the price of diesel was 4.8% higher than the EU average.

If duties and taxes are stripped out then the price of petrol in Ireland was 98.5% of the EU average; and the price of diesel was less than 1% higher than the EU average.

Against the background of high world oil prices my focus is on measures that will increase the penetration of renewable energy resources in the area of transport.

The Biofuel Obligation Scheme incentivises and enables the sustainable growth of an Irish biofuels market. The Scheme currently requires that the amount of biofuel brought to the market is not less than 6.38% of petroleum road transport fuels. In 2011 some 145 million litres of biofuel were brought to the Irish market.

The development of electric vehicles offers potential for Ireland to use cheaper grid sourced electricity, an increasing amount of which is sourced from renewable resources.

These opportunities will progressively reduce our dependence on imported fossil fuels for transport, while supporting energy competitiveness and security.

Television Licence Fee Collection

Questions (100, 105)

Michael Moynihan

Question:

100. Deputy Michael Moynihan asked the Minister for Communications, Energy and Natural Resources when he intends to replace the television licence with a broadcasting charge; and if he will make a statement on the matter. [10085/13]

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Brian Stanley

Question:

105. Deputy Brian Stanley asked the Minister for Communications, Energy and Natural Resources his plans to introduce a new charge to replace the current television licence; and if he will make a statement on the matter. [9973/13]

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Written answers (Question to Communications)

I propose to take Questions Nos. 100 and 105 together.

The Programme for Government commits to examining the role and collection of the TV licence fee in light of existing and projected convergence of technologies and to transforming the TV licence into a household based Public Broadcasting Charge to be applied to all eligible households and applicable businesses, regardless of the device used to access content or services.

In line with this commitment, my Department is involved in the ongoing analysis and policy development work that is necessary in advance of the implementation of any changes that may be required.

The replacement of the existing funding system based on the collection of television licence fees with one based on the imposition of device-independent charge on eligible households and businesses is a complex process and the logistics involved require thorough attention. Issues such as identifying the most appropriate collection method, exemptions and enforcement mechanics require detailed consideration and all have a bearing on the timeframe for implementation.

As I have previously indicated to the House, my Department is currently carrying out a Value for Money Policy Review conducted by an independently chaired group on the proposed policy. I expect to receive a copy of the group’s recommendations and report for my consideration by the end of March.

It should be noted that although subject to a degree of evasion, the existing TV licence fee system has provided a stable funding base for our public service broadcasters. The rationale for providing State funding for public service broadcasting is to provide an independent and reliable income flow that allows these corporations to attain their public service objects while ensuring they can maintain editorial independence. This is especially important in the context of news and current affairs.

The overall aim of Public Service Broadcasting is to provide services and content which cater for all interests in society, while ensuring that the varied elements of Irish culture and its intrinsic values are protected.

Through the statutory obligations placed on the Public Service Broadcasters and the criteria set for the funding of content through the Sound & Vision Scheme, which is funded from licence fee revenue, the production of quality indigenous programming and the production of minority interest programming is strongly promoted via the current funding regime.

Whatever the system of funding, the rationale for providing funding will continue to apply and any changes that may be implemented must continue to provide a secure funding base for public service broadcasting and content.

It is also important that any changes to the system of funding should take account of the reality of new mechanisms to access such content and services and the pervasiveness of such content in today’s society.

Publicly-funded public service broadcasting and content are now available to everyone on an ever-increasing range of platforms and devices and, in fact, access is not dependent on the ownership of a device. In short, everyone benefits from the availability of these services, regardless of how content is accessed or relayed to the public, and, therefore, it is my view that the cost should be borne by society as a whole. This underlines the rationale for a household based broadcasting charge. I will advance proposals in this regard after receipt of the Value for Money Report, which I referred to earlier.

Post Office Network

Questions (101)

Mick Wallace

Question:

101. Deputy Mick Wallace asked the Minister for Communications, Energy and Natural Resources his views on the need to maintain a strong rural post office network; and if he will make a statement on the matter. [9986/13]

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Written answers (Question to Communications)

As the Deputy will appreciate An Post is a Commercial State body with its own Board and Management. Therefore operational matters are a matter for the Board and management of An Post. These are areas in which I have no statutory function.

As shareholder, however, I do have a strong concern in relation to the ongoing commercial position of the Company and I regularly liaise with the Company in this regard.

It is my strong objective that An Post remains a strong and viable State company, providing high quality services on a nationwide basis through a network of economically viable post offices. I know that this objective is shared on all sides of the House. I must, however, stress that the Company must be in a sustainable and viable financial position to ensure this. I would also remind Deputies that An Post is a Commercial State Company and their strategy and decision-making must be formulated in this context.

I firmly believe An Post has many strengths. It is a trusted brand and it also has the largest retail presence in the country. I have impressed on the Company the need to further exploit its unique position in this regard and have been supportive of its attempts to diversify its income streams and to win a wider range of commercial contracts offering higher margins.

I welcome the progress An Post has made towards diversification including the announcement that following the decision of AIB to close a number of branches, an extended range of AIB services is available through Post Offices in the locality of the closures. This is beneficial not only to An Post as a commercial body but also to the local communities.

I, and my Department, will maintain ongoing contact with the Board and Management of the Company to work with them on our shared objectives in light of the challenging environment which they face.

Broadband Services Speeds

Question No. 103 answered with Question No. 95.

Questions (102)

Pearse Doherty

Question:

102. Deputy Pearse Doherty asked the Minister for Communications, Energy and Natural Resources if he has identified any legislation needed for the rollout of high speed broadband; and if he will make a statement on the matter. [9972/13]

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Written answers (Question to Communications)

The Government’s National Broadband Plan aims to radically change the broadband landscape in Ireland by ensuring that high speed services of at least 30Mbps are available to all of our citizens and businesses, well in advance of the EU’s target date of 2020, and that significantly higher speeds are available to as many homes and businesses as possible.

Specifically, it commits to:

- 70Mbps to 100Mbps available from the commercial market operators to more than half of the population by 2015,

- At least 40Mbps, and in many cases faster speeds, to at least a further 20% and potentially as much as 35% of the population, and

- A minimum of 30Mbps for every remaining home and business in the country.

During the preparation of Ireland’s National Broadband Plan, the commercial market operators indicated that they expect to provide 70Mbps to 100Mbps services to 50% of the population by 2015. The commercial sector is already committed to approximately €1bn investment, which will deliver broadband speeds of 30Mbps to 150Mbps per second to homes and businesses.

For example:

- Eircom is currently investing up to €500m in a phased deployment of fibre to the cabinet infrastructure, which is planned to make high-speed broadband available to 1.2m premises. The network has already reached more than 200,000 premises and is expected to be launched in 2013.

- UPC is investing €500m in its cable and fibre network, which is delivering speeds of up to 150Mbps. UPC aims to have this service available to 700,000 homes by 2015.

- Mobile telecommunications operators will be rolling out advanced mobile broadband products in 2013, following the recent multi-band spectrum auction. Arising from the huge increase in the use of smart phones and tablet devices, advanced mobile broadband is of increasing significance. It is expected that fibre connections will be required to service many of the base stations that transmit mobile signals.

A key element of the Plan is the Government’s commitment to investing in areas where high speed services are not commercially viable and will not be provided by the market.

The Plan also sets out a wide range of actions aimed at supporting and accelerating commercial sector investment in next generation broadband. It includes measures aimed at stimulating increased rates of digital adoption among citizens and businesses, the removal of barriers to make the various planning and consent approval systems more efficient and cost effective, a review of spectrum policy and legislation, as well as the potential contribution that State entities can make in infrastructure deployment.

A High Level Group has been established to oversee implementation of the Plan. Any legislative requirements that emerge as part of the implementation of the Plan, including the specific commitment to revise and update the spectrum legislation in the 1926 Wireless Telegraphy Act, will be progressed accordingly.

Earlier this month, my Department launched a tender for experts to assist in the design, planning and procurement of the State-led investment. Intensive technical, financial and legal preparations including stakeholder engagement will be ongoing throughout 2013 with a view to the launch of a procurement process in 2014.

The combination of these actions are designed to ensure the Government commitment that all parts of Ireland will have at least 30Mbps connectivity.

Question No. 103 answered with Question No. 95.