Government seeking to strike balance between attracting investment and maximising returns from natural resources to the State.
The Minister for Communications, Energy and Natural Resources Pat Rabbitte T.D., today announced that his Department has, following a public procurement process, selected international oil and gas experts Wood Mackenzie to advise on the “fitness-for-purpose” of Ireland’s current oil and gas fiscal terms.
Minister Rabbitte stated “Ireland’s offshore whilst holding great promise is relatively underexplored with only four commercial gas finds and no commercial oil finds to date. The last commercial discovery was almost two decades ago with the discovery of the Corrib Field.
“2012 saw one well drilled and three fields producing 0.4 billion cubic metres of gas and no oil in the Irish Offshore. By comparison in the Norwegian Offshore 172 wells were drilled, and seventy seven fields produced 114.8 billion cubic metres of gas and 694 million barrels of oil."
“In setting our fiscal terms we need to strike the necessary balance between attracting the high-risk exploration investment needed to prove that promise whilst maximising the return to the State and its citizens from our natural resources."
“Wood Mackenzie will bring its highly respected fiscal consulting experience to bear on this issue. They have been asked to focus their advice on what level of fiscal gain is achievable for the State and its citizens and the best way to achieve such gain”.
Minister of State at the Department of Communications, Energy and Natural Resources Fergus O’Dowd T.D said that the Government needed to be competitive on the open market to attract investment in exploration.
“The Government’s strategy for the exploitation of the State’s natural oil and gas resources aims to maximise the level of exploration activity and increase the level of production activity, while ensuring a fair return to the people” said Minister O’Dowd.
“Given increasing international interest in the Irish offshore it is timely that the ‘fitness-for-purpose’ of the existing fiscal terms be reviewed. This will ensure regulatory certainty in advance of the launch of the next oil and gas exploration licensing round expected in June this year.”
Published: 5th March 2014