Vol. 526 No. 5
12 Mr. Callely asked the Minister for the Marine and Natural Resources the current outlook and results of recent explorations for national resources in offshore activities; and if he will make a statement on the matter. [26441/00]
14 Dr. Upton asked the Minister for the Marine and Natural Resources the latest information available to his Department on the likely extent of test drilling for oil and gas in 2001; and if he will make a statement on the matter. [26922/00]
I propose to take Questions Nos. 12 and 14 together.
As I mentioned in my reply of 17 October to similar questions raised in the House, there are developments in relation to two hydrocarbon discoveries in our offshore, the Corrib gas field and the Helvick oilfield. Enterprise Energy Ireland Limited, EEIL, completed a fourth appraisal well in the Corrib gas field in September. The company and its partners are assessing the results from this well in conjunction with the data from previous appraisal wells with a view to determining the extent and characteristics of the reservoir.
EEIL is of the view that the Corrib field might have in place recoverable reserves of more than 1 trillion cubic feet of gas. This compares to over 1.5 trillion cubic feet of gas produced to date from the Kinsale and Ballycotton gas fields. It is too early at this stage, however, to give a precise figure for the size of the gas accumulation and the licensees will not be in a position to do so until they have fully evaluated the discovery. I expect EEIL and its partners to be in a position to decide on the commerciality of the Corrib field in the very near future.
Offshore petroleum exploration activity continues with 21 exploration licences in place covering 106 blocks or part blocks. In addition, there are eight offshore licensing options and two leases in place. Applications for two further licensing options and two lease undertakings are under consideration in my Department.
As regards the likely extent of test drilling in 2001, I expect to see a substantial increase in offshore drilling activity. While no firm proposals have as yet been received in my Department, it is anticipated that up to five exploration wells, one appraisal well and two development wells will be drilled next year. Well commitments beyond 2001, however, only amount to between three and six for the entire Irish offshore and it is probable that many of the frontier exploration licences issued in the last two to three rounds will be relinquished next year.
With this in mind I have commenced an initiative aimed at conserving areas of the Irish offshore, that is, closing them off from development, and gauging interest on the part of the industry in making well commitments in certain other limited areas. To that end, I am commencing a consultation process involving companies active here in order to gauge their views on whether well commitments might be forthcoming in the event that a limited number of new licences might be offered. In the light of this process and having regard to other issues, I will early next year consider asking the Government to decide on a limited number of possible further licences.
I thank the Minister for his very detailed response. When is he likely to receive information on the commercial value of the Corrib field? Are we talking about the first quarter of 2001?
It is not a question of commercial value; the companies involved must first decide on the commerciality of the field, whether they should proceed with a proposed investment of £500 million over the next two years with a view to bringing gas ashore by January 2003. We await this decision, which I understand is to be made shortly by the companies involved.
I assume the Minister is relatively sure that the announcement will be made. Everyone genuinely believes that a huge volume of gas will be brought ashore. All the plans being spoken about will come to naught if the owners decide that, commercially, it is not worth their while bringing it ashore. I assume, therefore, that they know at this stage that the commercial aspect is positive and that we are talking only about procedural matters.
While I cannot speak for the companies involved, a decision to spend £500 million is a little more than a procedural matter. While all the indications are positive, the boards of the companies involved have to make a final decision. I cannot anticipate that other than to hope it will be the correct one.
I believe it is more than hope.
Is the Minister satisfied that his Department is getting all the information that he requires? Will he comment on the possibility that the starting up programme for some projects is being deliberately delayed for commercial purposes?
I can state categorically that my Department is in receipt of accurate information from Enterprise Energy Ireland and is receiving the same information on the drilling results as that being received by its board in London. I take this opportunity to refute suggestions made by a small number of ill-informed individuals. There is no question but that the State is fully aware of what is happening and the expertise in the Department is fully au fait with everything that is happening on the drilling rig.
In regard to the necessary investment that will be required should it prove worthy and financially viable to invest, will the Minister indicate the level of Government support and the return it would receive for whatever support it may consider?
To what support is the Deputy referring?
The Minister mentioned investment of £500 million. Is there Government funding under the national plan or otherwise that can be allocated to assist people to invest whatever they might require from their company point of view? What return will the Government receive from its investment, be it infrastructural, directly or indirectly, or whatever?
No financial support from the Government is being given towards the investment made by Enterprise Energy Ireland. It is making the full investment in terms of bringing the gas ashore, terminals and so on that are required. Investment by the State involves the gas pipeline from Pollathomas in Mayo to Craughwell in Galway. That is being invested in by the State and part of that investment is being taken up by Enterprise Energy Ireland.
