Vol. 388 No. 8
asked the Minister for Energy the various proposals he has received from oil producing countries regarding the future use of the Whiddy oil storage facility and the Whitegate Oil Refinery, County Cork; and if he will make a statement on the matter.
11.
asked the Minister for Energy if, in view of the recent decision by a number of oil companies to halt importation of petrol and the continuing vulnerability of this country to such decision, the Government intend to take any decision to modernise existing refining capacity at Whitegate, County Cork and to construct additional modern refining capacity; and if he will make a statement on the matter.
40.
asked the Minister for Energy the number of proposals which have been received by his Department for the future use of Whiddy and Whitegate Oil Refineries, County Cork; and whether he has appointed any term for the purpose of assessing these submissions.
158.
asked the Minister for Energy the present position regarding the proposed take-over of the Whitegate Oil Refinery and the Whiddy Island Oil Storage Depot, County Cork.
I propose to take Questions Nos. 9, 11, 40 and 158 together.
The Deputies will be aware from my announcement yesterday of the priority the Government attach to the rapid development and upgrading of the Whitegate refinery. The decision to allocate significant funds helps greatly in my efforts to ensure that our national oil facilities of Whitegate and Whiddy are put to the best possible use. While my Department have had discussions with a number of possible interested partners in the development of the oil market here, none of the proposals is sufficiently developed at this stage to enable me to come to a final decision. I am establishing a special task force to examine a full range of technical and financial options for the refinery as a matter of urgency.
In relation to the proposals which the Minister has already received, will he indicated to the House when he might be able to make a decision on them? Do any of the proposals contain a proposal for distribution of petrol as distinct from securing supplies? In relation to the Minister's announcement yesterday about the £26 million which will be made available for expenditure on Whitegate, will he tell the House exactly what that expenditure will relate to, given, as I understand it, that if you upgrade the Whitegate facility and put in a cracker the cost involved will be in the region of £60 million to £100 million? I am curious as to what £26 million can do given that the overall cost of upgrading Whitegate in a meaningful way would be substantially more.
In answer to the Deputy's first question, I expect to be able to make a decision later this year. The developments to which I referred yesterday make it essential that I mix all the ingredients so that we have a comprehensive package which we can develop for the future. In relation to the question concerning distribution, one of the proposals includes that element but, obviously, it will be subject to many considerations before a final decision is taken. I do not know why the Deputy is disappointed that I have secured Government approval for the expenditure of £25 million on the upgrading of the refinery, and to say it is not sufficient is not perhaps the way to approach it. In the negotiations which I will be conducting and arising from the task force which I will establish later this week, we must decide the type of facility we will develop in Whitegate. We also have to decide the type of technology and the cracking to which the Deputy referred but, basically, we must ensure that we develop the highest added value produce possible. It may well be that, in the course of my deliberations, I will have a joint venture or other partnership in trying to arrive at the final solution. The fact that I now have resources available to me strengthen immeasurably my negotiating hand in that context.
I do not know why the Minister assumes I am disappointed that moneys might be expended——
I thought the Deputy was saying that the money was no use.
No. I am saying that if you build a house you must complete it before it is any use. If the Minister has only £26 million to spend on a facility that requires upgrading to the extent of £100 million I am just wondering how much good that small amount will do. Will the Minister confirm — he has half answered this — that the probability is that he will more than likely be entering into some kind of joint venture with an oil producing country to provide the balance of the funds to upgrade the facility to the required standard?
That is certainly one clear option and there may well be a situation where we would avail ourselves of EC resources as well because that would comply with the criteria for Structural Funds. However, my thinking at present is that we would negotiate with a partner, an oil producing country, for a consideration which would enable us to develop the refinery to the maximum possible extent, consistent with modern demands, environmental and otherwise, and at the same time have a much better degree of security of supply tagged to it.
I am now calling Deputy De Rossa who has a question tabled on the subject.
Will the Minister outline the groups of countries who have made proposals to him regarding Whitegate?I understand that there are two, Nigeria and Ecuador? Are there others? Will he give the House an assurance that whatever arrangement is reached will ensure that Whitegate is retained in Irish hands and that we will not find ourselves in a situation where we have no control over refining capacity? Will the Minister also indicate whether it is intended to increase our capacity to refine our needs in view of the threats made in recent weeks by the multinational oil companies to literally strangle the Irish economy?
I can stand beside anyone in this House in my efforts to ensure that we continue to have control in the development in Whitegate. My announcement yesterday travelled a long distance on that road in preparing for the future. I am sorry to disappoint the Deputy in relation to the countries and the names of some of the consortia involved as there are more than the countries to which he referred but I am not at liberty to tell the House how many or their nature.
Will the Minister respond to my question whether he intends to ensure an increased refining capacity? We are only in a position to refine 50 per cent of our needs at present.
The reason for the increased investment at Whitegate, commensurate with security of supply, is for us to be in a position to supply a much greater part of the Irish market — all of it, if possible — and perhaps even for us to consider exports. There would be no logic whatsoever in confining development at Whitegate to a consideration close to the mandatory offtake. What I would like to see happen is for the mandatory offtake to become meaningless and for us to have a competitive refinery competing with the best elsewhere in Europe.
Would the Minister give us some idea of what the terms of reference will be for the task force he is appointing? Could he also indicate if a public debate will be held on the report of the task force? The House would obviously want to be able to assess the net outcome of this major investment at Whitegate in a calm manner rather than by way of interplay across the Floor of the House during Parliamentary Questions.
The Deputy must trust me in these matters. He would like to have every say in what I do but there are times when he is not available to me and when I just have to make decisions.
Is the Minister objecting to democracy?
I would like this public debate — if it is going to take place — to take place very quickly so that we can get this operation going. Rather than talking about it, we need to address the problems at Whitegate and put in place a facility as quickly as possible which would give us the kind of independence in relation to oil supplies which all of us in this House, in particular the Government, would want to ensure at this time.
The Minister forgot to outline what the terms of reference of the task force will be and whether their report will be made available for public scrutiny.
The decision to set up a task force was only announced yesterday, as the Deputy is aware, and the terms of reference have yet to be set. Basically, they will be in three parts. The first part will relate to the kind of facility and technology to be put in place along with the economics of the project. The second part will relate to security of supply and the third will relate to competition in the market arising from the first two developments.
Will the Minister publish the report?
Perhaps a final question from Deputy De Rossa.
The Minister mentioned that he was negotiating with a number of interested parties so far as Whitegate and, presumably, Whiddy are concerned. Would he undertake to bring whatever proposals he has in relation to this matter before this House for approval in view of the national interest involved?
My enemies are growing by the minute. It would be impossible for me to negotiate on that basis. I would like to be as fair, open and helpful as I possibly can in this House. I understand that the democratic system places certain requirements on all of us here but to be frank it would be impossible to concentrate on securing a major international arrangement of the kind we have in mind while at the same time having to publicly disclose our hand prior to putting such an arrangement into effect. To do so, when a number of considerations have to be taken into account would be whether the Deputy accepts it or not, to undermine the commercial basis of what we want to achieve.
What would happen if we were to negotiate with Colonel Gadaffi?
Question No. 10.
A Cheann Comhairle——
I gave the Deputy quite some latitude.
I agree and it was appreciated but would the Minister not accept that what we are talking about here are the Whitegate refinery and Whiddy storage facilities which are public assets?
The Deputy must be brief.
We are talking here about the supply of the Irish market and breaking the stranglehold of the multinational companies on our oil market. This House has an obvious interest in the decision the Minister and the Government may make on this matter.
The Deputy has made his point. He is not asking questions but rather engaging in speech making and argument.
We are entitled, in the interests of the people, to have a say on the outcome of the negotiations.
Question No. 10, please.
The House has a very specific interest in these matters. I am merely telling the Deputy that I would find that obligation, in the context of commercial negotiations, impossible to fulfil.
