Dáil Éireann Debate, Tuesday - 6 May 2014
283. Deputy Bernard J. Durkan asked the Minister for Communications, Energy and Natural Resources the extent to which he remains satisfied regarding the adequacy of the relevant legislation in respect of oil, gas and other mineral exploration to give an adequate return to the Exchequer while, at the same time, creating sufficient incentive for exploration to continue; and if he will make a statement on the matter. [20363/14]
View answerThe report published by the former Joint Oireachtas Committee on Communications, Natural Resources and Agriculture in May 2012 contained a number of recommendations in respect of the fiscal and regulatory framework applying to oil and gas exploration in Ireland. In subsequent Dáil debates I stated my intention to seek further independent expert advice on the “fitness-for-purpose” of Ireland’s fiscal terms, such expert advice to focus on what level of fiscal gain is achievable for the State and its citizens and, equally important, on the mechanisms best suited to produce such a gain.
In March of this year my Department appointed Wood MacKenzie to provide expert advice on the fitness for purpose of Ireland's fiscal terms for oil and gas exploration, development and production. It is expected that Wood MacKenzie will shortly complete their assignment and their report will help inform future decisions.
Minerals exploration is regulated through a system of prospecting licences and exploration data is made available free of charge to incentivise exploration activity. The evidence presented by the number of active mineral prospecting licences indicates that the minerals development legislation is adequate in regard to the incentivisation of interest in minerals exploration activity. In the event of a commercially viable discovery being brought into production, companies are entitled to have the allowable exploration expenditure set-off against their tax liability. It has also been possible to agree a satisfactory return to the exchequer from on-going mining activities within the existing statutory framework. I do propose, however, to publish a new minerals development bill this year that will consolidate, modernise and further streamline the exploration and mining regulatory process.
