Dáil debates

Tuesday, 29 November 2011

2:00 pm

Photo of Pat RabbittePat Rabbitte (Minister, Department of Communications, Energy and Natural Resources; Dublin South West, Labour)

Since 2002, the regulation of the gas market has been the responsibility of the Commission for Energy Regulation, which is statutorily independent in the performance of its functions. I have no direct statutory function for liquefied natural gas projects, including specific projects like the Shannon LNG project.

I understand that Shannon LNG – a wholly owned subsidiary of the US firm Hess LNG – received full planning permission in 2008 for its proposed merchant development of a liquefied natural gas re-gasification facility near Ballylongford in County Kerry. As a commercial project, the investment decision is a matter wholly for Shannon LNG.

The LNG facility would provide additional security of supply to Ireland as it would bring diversity to Ireland's supply sources and would bring direct connectivity for the first time to the global LNG market. The prospect of such a facility is therefore a potentially positive step for the island of Ireland. Therefore, I strongly welcome the proposal by Shannon LNG to construct an LNG terminal.

I am aware that Shannon LNG, among others in the gas industry, currently has an interest in the outcome of a deliberative process being undertaken by the CER on the regulatory treatment of the gas interconnectors with Great Britain. There has been regular engagement between the CER and Shannon LNG about this matter. I have also met with promoters of the project.

This issue, currently under consideration, is an extremely complex regulatory question, not least given the implications for gas and electricity business and domestic consumers. The regulator's ongoing deliberative process in this regard is at a very advanced stage, with a decision expected to be made in the next two months. The regulator's own process has been delayed, ironically, by the formal complaint made by Shannon LNG to the EU Commission, alleging that the options being considered in the regulator's consultation amount to unlawful State aid.

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