Noel Dempsey (Meath, Fianna Fail)

There seems to be some confusion about what is involved when an operator obtains a frontier licence. It is impossible for an oil company to hold a licence without undertaking any exploration. The licences are premised on the completion of an ongoing work programme, which must be agreed by my Department in advance. The Department monitors the progress of the licences and insists on regular reporting.

Exploration licences are not issued without work programmes. In most cases, the programmes include an obligation to drill an exploration well. Under the current licensing terms for offshore oil and gas exploration and development devised in 1992, it is impossible for a company to hold on to an exploration licence for its full term without drilling at least one well. In the case of frontier exploration licences under the 1992 terms, the drilling of two wells would be required to enable the licences to last full term. All but five of the 26 frontier licences granted between 1994 and 1999 have been relinquished. Why would the oil companies surrender these licences if they had no requirements to undertake exploration work?

Deputies also came up with the bright idea of forcing companies to use certain Irish ports. As these Deputies should be aware, the government of any EU member state may not demand the use of certain ports by petroleum companies or anyone else. I do not know how the Deputies came up with this idea. EU Directive 94/22/EC of 30 May 1994 addresses anti-competitive measures by national governments in the prospecting, exploration and production of hydrocarbons. It is simply not an option for the State to demand that companies operating in Irish waters base in one port or the other. For reasons of practicality, a number of Irish ports have been used in recent years by exploration companies and this is likely to continue. For example, Killybegs has been a major beneficiary, as have Cork and Foynes. Cork harbour has been used to service the Kinsale gas field since the field began construction.

I would like to address some of the nonsense being propagated about the public consultation process for the next allocation of licences. It is alleged and repeated in this motion that we did not meet our obligations under the strategic environmental assessment directive, but that is plainly untrue.

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