Vol. 405 No. 8
2 Mr. Pattison asked the Minister for Energy if he will make a statement in relation to the farm-out agreement in respect of Block 49-9 in the Helvick Sea; if he will give an assurance that any further development of this find will require his agreement; and if he will outline the current terms which would apply to commercial exploitation and development of this find.
Atlantic Resources are the current holders of Exclusive Licence No. 2-81 which covers Blocks 49/9 and 49/10.
The company announced on 21 February 1991 that it had reached agreement with an Australian-Dutch consortium on the terms under which the consortium would participate in the licence. That farm-out agreement, as required by our licensing terms, has been submitted to me for my consent to the proposed change in licence interests. The agreement envisages the carrying out of an early assessment of the feasibility of a commercial development scheme which would involve oil production from Block 49/9. Once the results of this assessment are to hand it will be for the companies involved to make their own judgments and to decide whether to take the process further. In so far as the farm-out agreement entered into by Atlantic and its partners is a step along a road which could result in Irish oil being brought ashore for the first time in commercial quantities I regard it as a welcome development.
If it is eventually proposed to produce oil from Block 49/9, then the 1975 terms, as amended, most notably in 1987, will apply. Those involved will need to apply for a petroleum lease when a commercial discovery of petroleum has been established. Within 30 days of the application for a lease, the initial plans for the development of the discovery must be submitted to me for approval under section 21 of the terms. I can therefore assure the Deputy that my approval will be required at each critical point leading to any oil production.
Could the Minister state at this stage if he is disposed to giving approval in this case and on these terms?
I have only just received the application and it will receive due consideration in my Department. I will make my decision in time but it would not be appropriate for me to give any indication yet as to what that decision might be.
In considering his decision, will the Minister be endeavouring to try to get the best possible deal as far as the country is concerned and as far as the future of our oil reserves are concerned?
There is no doubt that Ireland is offering very favourable terms to encourage exploration and production where finds have been made. The terms under which any successful oil company produces oil are laid down in the 1987 terms, which I mentioned in my reply. That is well known and understood in the trade.
