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Dáil Éireann díospóireacht -
Tuesday, 4 Jul 1972

Vol. 262 No. 4

Ceisteanna—Questions. Oral Answers. - Bantry Harbour Authority.

12.

asked the Minister for Transport and Power if his Department has received a further request from Cork County Council regarding a harbour authority for Bantry Bay; and if he intends to take any action in the matter.

There has been no change in circumstances which would warrant the establishment of a harbour authority at Bantry Bay. A very full and comprehensive explanation why a harbour authority should not be set up was conveyed to the county council in a letter from my Department dated 2nd April, 1969. For the information of Deputies, I propose to circulate a copy of that letter with the Official Report.

Following is the letter:

2 Aibreán, 1969.

A Chara,

1. I am directed by the Minister for Transport and Power to refer to your letter of the 13th March, 1969, conveying the resolution of your Council that this Department's letter of the 18th October, 1968, on the subject of the establishment of a Harbour Authority for Bantry Bay be referred back for further consideration and enclosing an extract from the minutes of the quarterly meeting of the Council held on the 17th February, 1969.

2. I should refer in the first instance to the statement in the minutes attributed to the County Manager in regard to applications made by the Council at various dates before the emergence of the Gulf Oil project to have a Harbour Authority at Bantry. These applications were related to the Council's repudiation on legal advice of responsibility for dredging the approaches to Bantry Pier. The Council applied for a grant to meet the cost of necessary dredging and subsequently to have Bantry established as a scheduled harbour. The application for a grant was refused because, inter alia, it was normal maintenance expenditure which should be met from revenue and it was suggested that, though the Council could not be required to carry out the dredging, they were not precluded from doing so. In fact, the Council subsequently met the expense of dredging the approaches to the Pier. The Council were also informed that the establishment of a scheduled Harbour in relation to Bantry Pier would be contrary to the intentions of the Harbours Acts and that the existing and potential trade of the Pier would not provide sufficient revenue for a scheduled Harbour Authority to discharge its statutory obligations. The correspondence with the Council on these matters prior to the emergence of the Gulf Oil project related solely to Bantry Pier and its approaches and there was no question of establishing a Harbour Authority for the Bay or of the development of the Bay as such.

3. Since the Gulf Oil project at Bantry Bay was first announced, there has been criticism by the Council and others of the absence of a Harbour Authority to control the Bay. It has been argued that there was need for such an Authority to prevent oil pollution, to ensure safety of navigation and to develop the potential of the Bay for other projects requiring the availability of sheltered deep water. The main criticism, however, has been that the absence of such an authority means a substantial loss of revenue to the country by way of harbour dues from Gulf Oil.

4. When Gulf Oil first approached the Department of Transport and Power and the Industrial Development Authority in January, 1966, they had been engaged in surveying a number of possible sites in this country and outside it for their proposed bulk transhipment terminal. Subject to further examination of the physical and economic aspects of the proposal and the requirements of Irish law and regulations, they had narrowed their choice on Bantry Bay. They made official contacts at that stage in order to explore the possibility of obtaining grants and to ascertain the legal and other requirements with which they would have to comply. Because of the nature of the project, including the small permanent employment involved, and the likelihood that the availability of a grant would not be a determining factor in the Company's decision, it made clear at once that no grants would be available but that a commercial rent would be chargeable in respect of any State foreshore required for the terminal. On the other hand, it was considered that the siting of the terminal at Bantry Bay would be a worthwhile development in that area, provided satisfactory arrangements could be secured for safety of navigation, prevention of oil pollution and preservation of amenities. Moreover, apart from the permanent employment given, there would be considerable temporary employment afforded by the construction of the terminal and the regular calls of tankers should be of significant value to Bantry and the surrounding area. It was also a consideration that the existence of the terminal would incidentally provide within our territory very substantial additional oil storage capacity and a large stock of crude oil. There was finally the possibility that the location of the terminal at Bantry might encourage further industrial development in the area. It was decided, therefore, to encourage the Company to locate their terminal at Bantry Bay subject to the necessary safeguards being agreed.

5. The Company were, therefore, given all necessary information as to the requirements they would have to meet under the Planning Acts, the Oil Pollution Acts, the Petroleum Acts and other relevant legislation. It was made clear to them in particular that arrangements for preservation of amenities and prevention of oil pollution would have to be made to the satisfaction of the Minister for Transport and Power.

6. The necessity for a Harbour Authority received very careful expert examination in the Department and the conclusion was reached that the satisfactory operation of the terminal at Whiddy Island did not require the intervention of a Harbour Authority. Pilotage was unnecessary and enforcement of other requirements relating to safety, prevention of oil pollution etc. could be effectively secured by the Department of Transport and Power, the Commissioners of Irish Lights and the Local Authorities. The attitude of Gulf Oil was that while they had no objection in principle to the establishment of a Harbour Authority and to the payment of dues in respect of the services rendered by such a body, the whole project was only marginally economic and there could be no question of substantial payments being made over and above what would be justified to defray the cost of the necessary facilities and services which they would expect a Harbour Authority to provide. The Company were informed that the terminal and adjacent waters would not fall within the jurisdiction of any existing harbour authority and that, therefore, no dues would fall to be paid. On the other hand, the Minister for Transport and Power reserved the right to set up a Harbour Authority at a later stage if that proved to be necessary or desirable. In these circumstances, Gulf Oil would be expected to provide at their own expense the facilities and services which they would normally expect to obtain from a Harbour Authority in return for dues. It is necessary to remember that this attitude was taken before Gulf Oil made their final choice of Bantry Bay and was, therefore, one of the factors influencing that decision. It would not now be in accordance with the understanding on which the project was located at Bantry Bay to set up a Harbour Authority unless there was a real need for it.

7. Apart from the willingness and otherwise of Gulf Oil to pay harbour dues there could be no question under existing harbour legislation of extracting substantial profit revenue from the Company through the medium of a statutory Harbour Board. Under the Harbours Acts, Harbour Authorities are public nonprofit making bodies whose revenues must be devoted to the purposes of their harbours and whose scales of charges must be approved by the Minister for Transport and Power. Comparisons have been made with the dues charged at Milford Haven in Wales. There has been considerable development at Milford Haven where there is a large number of users. The funds are devoted to the purposes of the harbour including the dredging of deep water for the larger vessels now coming into use. There is no diversion of funds to national or local revenue. Dues are applied for the present and future benefit of the users. Gulf Oil have provided their own private harbour at their sole expense. They are paying a substantial rent in respect of the State foreshore they occupy and pay substantial rates to the local authority. There are no grounds for the charging of dues to them in respect of services which they provide for themselves and are not required by other users. If a harbour authority is set up at a later stage the approved scale of charges will have to take account of the expenditure already incurred by Gulf Oil in the provision of harbour facilities.

8. As regards further development of the potential at Bantry Bay it is necessary to examine what this potential may, in fact, be and what measures, if any, are likely to attract additional users to the Bay. A number of exaggerated claims have been made largely because Bantry Bay is erroneously compared as regards its natural features with developed ports elsewhere. The incidence of deep water and shelter is not unique to Bantry Bay either in Ireland or elsewhere in Europe. The Bay was only one of a number of possible locations examined by Gulf Oil and the Company's second choice would not have been in Ireland. The siting of Harbours has never been determined principally by natural features but by the needs of the traffics they serve. Where commercial needs require it, deep water harbours have been provided in the most unpromising situations. Rotterdam, the greatest port in Europe, has few natural advantages but sits astride one of the world's great trade routes. Many existing British and European Harbours have announced development schemes to enable them to accept vessels of up to 250,000 tons dead weight and upwards and plans have been mooted for the provision of terminals to deal with vessels up to 500,000 tons at undeveloped sites in the Clyde and at Foulness at the mouth of the Thames. Plans to meet the requirements of the largest ore containers now in use or on order have been undertaken or announced by the principal European ports.

9. In the particular case of Gulf Oil, the adoption of the bulk transhipment principle and the selection of the site at Bantry Bay was largely determined by the particular pattern of their refineries and markets in Europe. The Company have a number of relatively small refineries with limited markets, for which deliveries from the largest tankers, even if the necessary depth were available, would not be economic or convenient. They adopted this system of transhipment in order to maintain their competitiveness with companies who were planning to deliver direct to refineries with vessels of 200,000 tons dead weight and upwards. The system of bulk transhipment has no universal validity and none of the other oil companies have given any indications of adopting it. Most of them have committed themselves to large fleets of 200,000/250,000 ton tankers for direct shipment to refineries. Neither is there any indication that a bulk transhipment system may be adopted in connection with the supply of ore or other bulk cargo to Europe.

10. It will be seen, therefore, that the prospects of further development at Bantry Bay based on its natural advantages are, in the light of present knowledge, very limited and certainly not of a kind which would warrant substantial speculative investment. On the other hand, in these days of rapid technological change, the possibility of further desirable development in the Bay cannot be ruled out and the Government is anxious to encourage development of the right kind there. If any projected development requires the establishment of a Harbour Authority the necessary steps can be taken without delay. It cannot be assumed, however, that such further development can be secured without Government grant or assistance as in the case of Gulf Oil and it will most certainly not be secured by transparent attempts to extract profit revenue from Gulf Oil under the guise of harbour dues.

11. The possibility of damage arising from oil pollution at Bantry Bay was one of the principal factors which were carefully examined before the project was approved. This matter was the subject of a Press Release issued by the Department of Transport and Power on the 28th October, 1968, which dealt comprehensively with the problem and with the steps taken to obviate the danger. Briefly, the main danger of oil pollution to our coasts arises from the possibility of an oil spillage at sea even at a considerable distance from our coast and not at the installations in our own ports over which we can exercise effective control. Nevertheless, despite the stringent precautions agreed with Gulf Oil, a relatively small but alarming spillage of oil occurred at the terminal on December, 25th and 26th, 1968. This spillage was fully investigated by the Department of Transport and Power and it was found to have been due mainly to the fact that, owing to delays in the completion of the terminal, all the agreed safety precautions were not in effective operation. The Company was prosecuted by the Department and was fined £250. It emerged during the hearing that the Company had incurred some £30,000 expenditure in making good the damage and paying compensation. This experience should have a very salutary effect.

12. To sum up, the position is that there is no technical need for the services of a harbour authority at Bantry Bay at present, nor is the possibility of further development there in any way inhibited by the absence of such an authority. If any change in circumstances indicates the need for a harbour authority the necessary steps to establish such an authority can be put quickly in hands. In the meantime, proposals to hold Gulf Oil up to ransom for dues in respect of which no necessary or commensurate services are provided are well calculated to discourage possible future users.

Mise, le meas,

(Sd.) D. Ó Ríordáin.

Secretary,

Cork County Council,

County Hall.

Cork.

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