Vol. 467 No. 7
6 Ms Keogh asked the Minister for Transport, Energy and Communications the current position regarding the removal of the mandatory off-take at Whitegate Oil Refinery, County Cork; and if he will make a statement on the matter. [14161/96]
The mandatory off-take of petroleum products from the Whitegate Refinery will end with effect from 1 January 1997. Until then, importers of gasoline, gasoil, propane and butane will continue to have a statutory obligation to purchase up to 35 per cent of their requirements from the refinery.
In order to enable the refinery to trade on a fully competitive basis, the Irish National Petroleum Corporation Limited is implementing a three-year programme of investment which is due for completion in December 1996. The results of this programme, allied to a number of marketing initiatives, are expected by the INPC to enable the refinery to operate on a commercial basis when the mandatory regime ends.
I am grateful the Minister has confirmed to the House that the mandatory regime will end on 31 December this year. Perhaps the Minister could give the Department's estimate of the prospects for INPC from 1 January when there will no longer be an obligation on oil companies to buy one third of their product from the Cork refinery. Will it affect supply and employment and will it be able to compete?
There are currently 155 people employed in the refinery. I am satisfied that with the investment programme undertaken by the company, with my approval and the approval of the Government, the refinery will be viable from 1 January next year. I do not foresee any other situation developing. The company has developed new products and new markets as well as investing in more efficient systems in the refinery, including a new combined heat and power unit which it has installed.
I wish it success.
The Minister will agree that Whitegate is a small refinery by international standards. However, the performance of management and staff at all levels in the company is outstanding in the semi-State sector. Perhaps the Minister could tell the House what proposals his Department and the Government have to expand the role of Whitegate when the mandatory regime ends.
There are no specific proposals to expand the refinery at present.
What about the role of the refinery?
The role of the refinery is to refine oil products into various other products.
And to sell them.
It is most important to sell them. The company has developed its markets in preparation for the nonmandatory regime and I am satisfied it will succeed. If there is a need for a larger refining capacity in the future, a number of possibilities must be considered, including a joint venture with the private sector, direct investment by the State or a combination of both. However, the main reason we need to retain the refinery is for security of supply. We could import oil and oil products as cheaply as they can be produced here, but we need a refinery. That has been the consistent position of the Government and it was also the position of the two Opposition spokespersons when they were Ministers in the Department. From a security of supply point of view, it is necessary to have a refinery in Ireland. We are confident it will be commercial from 1 January 1996.
Is the Minister telling the House that the Whitegate Refinery will be left to the vagaries of the market after the mandatory regime ends and that there are no plans for ensuring it will be sustained and expanded in the future?
I am not saying that. The refinery has prepared itself to take on the market and to survive in it. I am confident it will do so.
