Vol. 500 No. 3
1 Mr. Finucane asked the Minister for the Marine and Natural Resources the results of discussions between his Department, the Irish Offshore Operators Association and SIPTU regarding the employment of Irish rig workers for seasonal work on oil rigs and also the servicing of the rigs from Irish ports; and if he will make a statement on the outcome of these discussions. [3738/99]
Arising from discussions I had with the Irish Offshore Operators Association and SIPTU, I arranged that my Department set up and facilitate discussions between representatives of the Irish Offshore Operators Association, the Irish Congress of Trade Unions, Enterprise Ireland and the Irish Offshore Suppliers Association on the utilisation of Irish resources and services in the offshore petroleum industry. These discussions are ongoing. I am anxious that Irish involvement be increased and sustained over the longer term.
As I previously stated in the House, there are no powers available to require undertakings in regard to jobs or the provision of services by the oil companies involved in offshore exploration activities. The imposition of such conditions on licence holders is precluded under EU regulations. Responsibility as regards employment of workers, the provision of services and related issues are strictly matters for the exploration companies and their contractors.
With regard to the selection and use of Irish ports, these are also matters for the companies concerned. My Department's sole responsibility in that regard is to ensure that the port meets the necessary criteria, particularly in respect of the required emergency response standards. Enterprise Ireland, under the aegis of the Department of Enterprise, Trade and Employment, has responsibility for ensuring maximum input of Irish industry in offshore exploration operations. In that context, Enterprise Ireland liaises with port authorities regarding the development of local servicing for the oil and gas industry in order to maximise successful bidding.
I reiterate that it is Government policy to ensure that the economy benefits to the maximum extent possible from offshore exploration activities within the constraints of EU legislation. I have continually impressed on the Irish Offshore Operators Association and the individual operators that Irish workers and suppliers of goods and services must be given opportunities to participate in such activities and I will continue to do so.
In a reply on 4 November last the Minister indicated that he had written to SIPTU and the Irish Offshore Operators Association encouraging them to employ Irish workers. While I accept that his role is restricted, will the Minister indicate if he received a response to his letter from those two organisations?
To my knowledge they responded only to the extent that they participated in the arrangements for discussions which I requested. Those discussions are ongoing. This is a difficult situation and the best approach to take is to bring together the various interested parties, including SIPTU, the Irish Congress of Trade Unions and the Irish Offshore Operators Association, to develop a formula that will be more satisfactory than previously.
Will the Minister communicate with the petroleum affairs division in his Department? It is my understanding that Enterprise Oil will be drilling again this year and will require a service base location. The Minister will be aware that this was lost last year. A separate contract will be granted in respect of catering which will offer employment for 20 people. I understand that it would not be difficult to win that contract and retain some of the employment on offer in this country. Additional discussions on a discreet basis might elicit a favourable response.
The purpose of the meetings is to ensure that all of the sectors concerned will be included and any possible impediments will be removed. For example, there have been suggestions that the people involved might not be up to date on safety procedures and refresher courses can be provided to remedy that. I am sympathetic to the Deputy's views on this area and I want to see action taken because what happened last year was unfortunate.
We expect and hope to see further exploration this year with an additional two wells being drilled to delineate the field. The well drilled last year appears to have been successful and the indications are good. However, further exploration is required. We hope this will happen in the current year which would mean that a great deal of additional employment would be on offer in the area. I accept the Deputy's points and I will monitor the situation closely.
2 Mr. Bell asked the Minister for the Marine and Natural Resources the number of licences issued to companies for offshore drilling for oil and gas; the names, locations and registered offices; the number engaged in drilling; if he has received up to date reports from each company; the companies which have indicated to him that they have located gas or oil finds; the quantities in this regard; and if he will make a statement on the matter. [1465/99]
There are 25 petroleum exploration licences in place. In addition, two applications for licences under the frontier licensing round in the South Porcupine Basin, which closed last December, are being assessed and I expect to make a decision on these in the coming weeks.
Information regarding the various authorisations issued, together with the names and addresses of the companies involved in petroleum exploration in the Irish offshore, is contained in a report prepared by my Department every three months or so. A copy of the latest report is being furnished to the Deputy. I should add that the names of companies exploring for petroleum are a matter of public record. I report the position by way of a half yearly report in respect of each six month period ending 30 June or 31 December, in accordance with the Petroleum and Other Minerals Development Act, 1960. These reports are laid before each House of the Oireachtas and copies are kept in the Oireachtas Library. The most recent report available covers the period 1 July 1998 to 31 December 1998.
There is no company engaged in drilling for hydrocarbons in our continental shelf at present. However, there were important developments last year in relation to two hydrocarbon accumu lations in our offshore, the Corrib gas accumulation and the Helvick oil field. Three other earlier discoveries of some significance were the Connemara oil field, the Seven Heads oil and gas accumulation and the south-west lobe of the Kinsale Head gas field.
In the case of the Corrib, located off the Mayo coast, in 1998 Enterprise Oil and its partners, Saga Petroleum and Statoil Exploration (Ireland) Limited, drilled and tested an appraisal well, flaring gas on a test at a stabilised rate of 63 million cubic feet of gas per day. It is not possible to give precise figures for the size of the gas accumulation at this stage; this will only be possible when the accumulation has been fully evaluated. The evaluation process will involve further appraisal work being carried out over the next two to three years and is expected to include the drilling of additional appraisal wells.
In May last year a ten year petroleum lease was granted to Providence Resources plc, over the Helvic oil field off the Waterford coast. Published figures indicate that it contains an estimated seven million barrels of recoverable oil together with associated gas. Under the terms of the petroleum lease, the company is required to submit a detailed plan of development for the field for my approval by 1 May 2000.
The Connemara oil field, with an estimated 200 million barrels of oil in-place, was appraised in 1997 by Statoil but the results were such that the company concluded that it could not declare the field commercial. The Seven Heads oil and gas accumulation, estimated to have at least 50 million barrels of oil and 100 billion cubic feet of gas in-place, was offered to the industry last year under a lease undertaking round but no applications were received by my Department.
The south-west lobe of the Kinsale Head gas field, estimated to contain some 50 billion cubic feet of gas in-place, is not being drained by the existing production facilities. Marathon, the operator, is currently considering the possibility of a programme of development to bring this into production.
The Government is committed to continuing to promote and encourage, to the fullest extent, hydrocarbon exploration in Irish waters in order to enhance the prospects of further commercial discoveries.
I thank the Minister for his detailed reply. Is it conditional on the issuing of licences that the companies are obliged to supply him with regular reports on their activities? Is he satisfied they provide all the information required by the licence? Is he confident that any of the finds are likely to develop and become commercially active?
There are regular reports and people are designated to be on the rigs – they can be vessels or rigs – while work is ongoing. My officials, geologists and others involved are confident they have the necessary information. They are experts in the field and have been involved for a long time. They would, therefore, be good operators. I am anxious to ensure I have the best possible knowledge of what is happening.
With regard to the most recent finds, the Helvick oil field involving Providence Resources plc is, unfortunately, a relatively small find. It is commercial, but it will not have a huge impact. We await further developments there.
A major find last year was the gas well off the coast of County Mayo. There is much confidence about its future. The flow rate of 63 cubic metres of gas on what is termed a 2 inch choke – if the choke was bigger the flow rate would be higher – indicates a high pressure rate. At the time, the flow rate was recorded as the sixth best for either the North Sea or here in terms of an individual well. However, it is located well out in the Atlantic Ocean, it is expensive to reach and a field would be required. The question then arises as to what will happen next. The two other wells would delineate the field and show if the estimates of the rest of the gas in the area, which have been derived from geological studies and soundings, are realised. I am hopeful the results will be positive, but until results from these two wells are established it will not be possible to be clear about the situation.
It is important that these wells are drilled. That the plans are being proceeded with in the current climate is important because investment in this drilling area has been virtually eliminated in view of the very low price of oil. It is a bad period to be engaging in such activities, but it should not last indefinitely. If the field produces the expected results it will be the biggest find here since the Kinsale gas find.
