I did not happen to be in the House last night, but I heard that Deputy McGilligan, in order to try to prove that Fianna Fáil had been lax in the investigation of mineral deposits in this country, quoted a statement I made in 1948, quoted that statement in part only and without giving the complete context. Apparently he quite deliberately wanted to give the impression to the House that the former Taoiseach, Deputy de Valera, had in some way given up hope that there were mineral deposits to be exploited. That was very typical of Deputy McGilligan. He enjoys misquoting people; he enjoys quoting extracts from debates in order to prove a point.
Now, although it is of no very great importance to this debate, I think I should explain that in 1948, there was a discussion on the reduction of the grant for the exploration of the Avoca deposits. At some stage prior to that debate, the Government had been criticised because certain explorations of minerals had failed. One of the explorations that had proved there was no point in any further commercial exploitation was that undertaken in connection with Arigna iron ore. There was a time when a number of people here, including mineralogists, making their own private inquiries, were under the impression that it was possible that the British geological survey deliberately understated the position for quasi-political or purely political reasons.
It was discovered by the Fianna Fáil Government that, in fact, the geological surveys were on the whole reasonably accurate and at one time the former Taoiseach mentioned these surveys in the course of debates; we were being criticised because we had failed to exploit some of the ores in relation to which explorations had been conducted and results proved negative. One good example was the cost of the iron ore in Arigna where the percentage of iron was found to be insufficient for exploitation; the amount elsewhere in the world was sufficient in quantity and the price sufficiently low to prohibit our going ahead with that project.
In that debate, having referred to the statement by the former Taoiseach, I went on to say at column 2037 of Volume 110:—
"At the same time, I am well aware that a number of new processes in regard to mineralogical development have taken place since the war. There are new and simplified processes of extracting minerals by means of electricity and centrifugal separation, and so on. Before we take an extremely pessimistic view, that, although we have practically every mineral in this country in small lots in the soil, we must abandon all major mineralogical development, we should make at least one final examination using the new processes evolved during the war for extracting metal from low-grade ores."
That statement makes it perfectly clear that I, speaking as a member of this Party, advocated our going straight ahead and conducting as many examinations as seemed desirable because of the new processes and also because, since the war, the price of many metals had increased as a result of technological development, the production of high-grade ores and, in the case of copper, as a result of the enormous use of copper for electronic purposes. Deputy McGilligan can have his little point if he wants it, but it will not get him very far; he fails to quote the remainder of the speech and gives a false idea to the House as to what our views were in regard to mineralogical development.
In relation to the Bill we are now discussing, I recognise that it would be difficult for any Government to make the necessary decisions about Irish participation in this new venture, the nature of the company or the nature of the lease of any company undertaking the extraction of copper, or the nature of the lease with the Government of the day. Copper mining is, in spite of the high price of copper, still a very speculative project. I believe that only one out of every 100 ventures goes beyond the prospector stage and only one out of ten mines, after production starts, continues profitably for a number of years, indicating that, although the price of copper is high, copper mining is a very speculative business.
In contrast to that, as the Minister knows, the price of copper, nickel, lead and zinc has been constantly rising and the development of electronic equipment and atomic energy have stimulated the demand for these metals all over the world. I understand that the ore at Avoca is 1.2 per cent. and the American Government has spent several billion dollars subsidising private copper mines for the sake of providing a sufficient stockpile of copper for armament purposes, where the percentage is only .9. Here there is a narrow margin between what is regarded as highly profitable copper mining and mining that requires subsidies. I understand that when the percentage rises from 1.5 to 2 per cent., there is little doubt that it becomes a highly profitable venture and, in the case of the proposition now before us, the profitability of extraction depends on whether the company engaged in the work assumes they must base their estimate on the price of copper for the past three or four years, namely, some 33 to 35 cents per lb., or whether they can gamble on the price of copper remaining at its present very high level of anything from 45 to 48 cents per lb. There, again, I think it is extremely difficult for the layman to judge what should be the attitude of the House in discussing the terms of the lease. As the Minister probably knows, aluminium is not as good a conductor as copper, but it definitely enters into the picture when copper rises above a certain price. As I understand also, aluminium production in the world has not reached its zenith. In spite of the opening of an enormous plant in Canada, there is still a colossal demand for aluminium metal, even though the ore itself is one of the commonest in the world, unlike copper.
Again, the probability of the Avoca mines, considering these two price limits, the present price of 46 cents and the average price during the last three years, depends upon a number of factors which it is very difficult to prejudge in this House. It depends on the extent of stockpiling by Governments for certain purposes; it depends also on how much continued labour unrest exists in various mining centres in the world, the unrest having actually affected the price of copper in recent months. It depends also on what other sources of copper are likely to be discovered in various parts of the world and to be exploited. I understand, for example, that there are enormous deposits of copper of a fairly high grade in South America, but the difficulty there is an almost complete absence of transport. If the transport bottleneck could be overcome, there would be a large source of production available there, and I believe there are similar bottlenecks elsewhere of labour, capital, and so on, the elimination of which could bring a very considerable increase in copper production and changes in the price.
Over and above that, of course, there is the question of the actual copper market itself and of the price determination by copper interests. As the Minister probably knows, copper at the moment is sold in the world market on two different bases. One group of companies have a certain principle in regard to fixing the price and another group have a different principle, and there has been considerable argument in the mining journals in regard to the establishment of these two principles. That again must affect to some degree the question of the lease and the position here.
Deputy Lemass suggested various alternative methods by which the Irish capital market could have a part in this venture. He made it clear himself that it would be very difficult to determine exactly what should be done about it. For my own part, speaking personally, I feel, having made a very amateur study of this question, and naturally it must be amateur, that on the whole a professional mining company is the one we need and that to have a group of people, without not only professional mining knowledge but intimate contacts with the copper market all over the world, might be very risky. The fact that, in the world of copper mining, there are copper mining interests who are interlinked as between Africa, Canada and the South American Continent is a very important point in the whole of the discussion on this question.
We must take into consideration not only their international contacts but their technical knowledge, and also the ability of the professional mining company to take tremendous decisions in the direction of capital expenditure planned over a period of one or two years, decisions which will frequently frighten the minds of those who are engaged in an ordinary company who might employ a consulting engineer for this purpose and attune their minds to the copper world. They might find it very difficult to do so because of the necessity of taking advance decisions and engaging in long-term financial commitments.
Having said all that, I would like to repeat what has been suggested and to ask the Minister whether there could not have been some participation between the Canadian interests and Irish interests, if only on a financial basis? The Minister may have a very reasonable reply to make, but it is surely reasonable on our part to ask this. We would like to enter into the world mining interests and to get the flavour of the mining world. There is a number of alternative ways by which, even though this Canadian company were to be the principal partner in the venture, some definite Irish interests could also participate. It might have been possible for some of the share capital to have been made available on the Dublin Exchange in sterling at the time when the prospectus was issued. It might have been possible for an Irish holding company to have formed a holding company with some financial link with the Canadian company for the purpose of holding some of the shares and having an interest in the venture, or even for the purpose of having some part in the sale of the ore when the ore was extracted. It might have been possible to have a joint company consisting of Irish directors and Canadian directors in which the Canadian section of the company would have some very definite powers in regard to the expenditure of money.
I understand that one of the difficulties in any joint company of this kind is that no professional Canadian mining engineer with long experience of success at this business will act without very great delegation of powers being given to him. In most of these mining ventures, the principal engineer is given an enormous delegation of authority, is allowed to go ahead with his plans and commit his company to very large expenditure without interference, and most of this kind of men will not act, unless they are given that authority. Nevertheless, within the ambit of the various suggestions I have made, I should like to ask the Minister if it would not have been possible to have some sort of Irish participation, so that we could have appointed a certain number of persons with executive ability who would acquire a knowledge of mining which might be very useful to us in the future?
May I also ask the Minister whether any plans have been made in regard to the other ores in Avoca? Will he tell us whether there is any plan for the disposal of barytes or if there is any other Irish company which would take part of the barytes which would be extracted at the same time as the copper? I would further like to ask the Minister whether anything can be done with the iron which will become available at the same time?
Then, we have the question of the further process of smelting the copper. Is it not only reasonable for us to ask whether the Minister is aware of the arrangements that could be made in the future to smelt the copper ore? Would it be possible to have a smelting plant here and would he state whether the lease applies to smelting or whether it is confined purely to extraction, and whether possibly there might be a second company formed in which there would be an Irish group associated or an all-Irish company for smelting ore, or whether we are committed in advance to export the ore before smelting?
Smelting would give further employment, involving technical processes which would be of great value to this country. It would bring us in more foreign exchange because the material would be sold at a point where it would receive further processing. I think it is important for us to know how far the Minister is committed in regard to smelting and what may happen in regard to that matter in the future.
So far as the Bill itself is concerned and the facilities it gives to the mining company, I would like to suggest to the Minister that a great deal of the taxation in relation to industrial development needs revision. It is rather a pity in a way to see this Bill, which is obviously meant to apply to a very narrow field of activity, when what is needed very badly is a complete revision of taxation to encourage capital development and, in particular, to encourage export development. In the face of our present balance of payments and with due regard to whatever regulations may exist in regard to the liberalisation of trade under O.E.E.C., it surely is necessary for us to reconsider the taxation as applied to future export industries, industries that will export materials other than ores, if we are to expand our national effort and to overcome this problem of the balance of payments.
Many representations have been made to the Minister by the industrial interests in this country in regard to depreciation allowances and in regard to taxation reductions when new companies are going into business. A committee was established to report on this matter, but we have had no report from that committee. It was initiated by this side of the House before we left office and there was a demand that there should be a speedy report from that committee. There should still be a speedy report from the committee and still speedier action by the Minister for Finance. Something very bold and emphatic must be done if we are to establish national exports. Countries such as Germany and other countries in Europe have all sorts of methods by which exports can be established.
Well worth while schemes can be considered and although ultimately the O.E.E.C. agreement to which we subscribe prohibits exports fostered by tax concessions, a great deal can be done in the initial phases. The cost of exploring markets and of ascertaining designs required for the foreign market, even the travelling expenses and the advertising campaign necessary in the initial stages, can be very expensive and some method should be designed to give relief from these expenses. I am sure the Minister can get a wealth of information on these matters.
There are many other forms of potential production in which the initial costs are great and where the risks, even before such an industry gets into production, are very extensive. There are the risks of changes in currency values and the prices of competitive products which may have to be met at any time, even just after the venture is in operation.
I hope that the fact that this Bill has emerged in its present limited form does not mean that the Minister is unaware of these difficulties and that he will reconsider this matter and realise that the principle may have to be extended over a very wide field, if we are to give more employment in this country and build up our national resources.