Mr. John Moloney:

I will make a start on them. I thank Senator Mooney for his comments. I hope I can live up to them. The percentage of land in Ireland that has been afforested has improved. It is greater than 7%. The figure of 7% relates solely to the Coillte estate. There has been a significant expansion in private afforestation over the last 20 years. I cannot give the Senator a precise figure.

On an issue linked to the question asked by Deputy Ferris, Coillte operates approximately 700 partnerships with farmers in the context of assisting them develop their holdings for forestry and to work with them in maximising their value over time. The development of the private forestry sector has been positive. However, it has not grown at the rate or extent it could or should have grown. There are a variety of reasons for this. For example, farmers want to expand their land for farming, however poor the land is and the impact of various grant aid schemes on land availability and the need for acreage. There are also historical reasons, such as we have not had a forestry culture. We had in the past, but not in recent years, although the position has improved steadily. Coillte has not expanded to the same rate in the private sector forestry arena because it was largely driven by grant aid and under state aid rules, Coillte was prohibited from participating. There is nothing wrong with this, once the private sector and farmers are encouraged to see forestry as a viable alternative land use.

In regard to tourism, we have tried to get over the hiding our light under a bushel attitude. Quite a successful event was held in a well known hostelry across the road from here and public representatives were invited to a presentation on public goods. This presentation gave a good perspective on what is done to support the generation of public goods that enables tourism. Coillte manages 2,000 km of marked trails, 150 open sites and 11 forest parks. There is a net cost to the organisation of doing this, of approximately €4 million a year, but this is part of the dividend that flows back from the business. The marketing of Coillte is linked to specific regional projects and this probably gives them the best advantage. Something for Coillte to consider down the road is where there could be a broader open forest marketing designation. The dumping of waste in forests is not good, but I will leave it to my colleagues to comment on that. It is difficult to control access over 445,000 ha.

In regard to the question put by Deputy Ferris on the number of people employed, we have 900 people employed, but I cannot say whether that number will be maintained. The organisation must continue to try to be as efficient as possible. We maintain a significant asset base and must balance the number employed with an asset base which generates relatively low returns, as is the nature of forestry, over a long period. The real return from forestry net of inflation is somewhere between 4% and 5%. Therefore, we need to be very careful regarding the costs involved in managing such a business. Second, inevitably forestry and forest output is linked to the construction industry cycle. The business must be managed very prudently to remain efficient. Therefore, as technology moves on, it is difficult to give commitments.

In terms of indirect activities, it makes sense for Coillte to contract many indirect activities to the private sector, because this activity is dispersed around the country and is linked to harvesting. As the harvesting of saw log increases over time, there is potential for this activity to grow. Technology has moved on. Some 40 years ago or so, harvesting a hectare of forestry would have meant tough, hard, physical labour, but the development of harvesting machines has changed this radically over the past 25 years. As forest estates mature, there is potential in this area.

In regard to a mineral survey, to the best of my knowledge the answer is we have not carried out such a survey. As far as I am aware, the mineral rights to land, apart from sand and gravel, are held by the State. Coillte has looked occasionally at the potential for sand and gravel extraction on the land base, because we maintain a road network of 9,500 km. Therefore, if we can source some of our own material to support this at first cost, this is a cheaper alternative where we have that land. The only area that would have been looked at in the past was the location of sand and gravel, particularly with a view to maintaining our road network, which is extensive. This network is expensive to maintain and is coming under more pressure as we extract heavier loads of timber from it.

On the issue of our relationship with farmers, we have 700 farm partnerships. I believe there is scope for Coillte to deliver advice to farmers, in partnership with Teagasc and the Forest Service as farmers experience with forestry grows, particularly as they come into the challenging phases of harvesting the first thinnings, maximising the value of the crop. A good example of this would be the partnership work done in recent weeks between Coillte, Teagasc, the IFA and the Forest Service on managing the effects of the storms of recent months - advising on how farmers can deal with storm damage, clearfelling and how to maximise the value of this. For many with no experience, the storm damage seems a catastrophe, but Coillte staff have been through this many times and know what to do. Sharing this advice with farmers has been a good initiative for the organisation.

Deputy Pringle asked about biomass. To some degree, Coillte has output and thinnings that could go to biomass. Currently, this material goes to the panel mills. A study completed a number of years ago indicated that putting first thinnings into the panel mills was a better economic proposition than burning it. That is not to be disparaging about biomass. Looking at the situation in Europe, the issue in regard to biomass is that combined heat and power plants using biomass have been driven by grant aid. Support for that has emerged in the UK in the past number of years and in Austria, in particular, approximately 15% of the thinnings of timber output goes into combined heat and power plants. This market is driven by grant aid and needs this aid because of the high capital cost of combined heat and power plants to support that kind of raw material and plant set up costs.

Perhaps a programme like the REFIT scheme that applies in the area of wind or renewable heat incentives in Ireland could have a game-changing effect on this market. Coillte has significant experience on both sides of this. At the Medite combined heat and power plant in Clonmel, we generate over 40 MW of heat equivalent. This is probably the biggest plant of its type in the country. It burns a significant amount of forest waste, sawmill residue and brash, which is the residue after clearfell. I should point out that brash can be expensive to assemble and bring together in sufficient volume and in a format that can be shredded for use. However, if we had a network for that, the transport costs could be reduced which means there may be some opportunities for this in the future. Coillte remains a big buyer of wood chip from sawmills for the panel plants and provides an outlet for that.

I do not believe there is any conflict in regard to Smurfit Kappa, because what we are dealing with there is what is known as product for craft liner from virgin forest. There is no such paper mill in Ireland. The nearest one is in France.