Fergus O'Dowd (Louth, Fine Gael) | Oireachtas source

Standard Exploration Licence 2/11, which was issued last year, is held by a consortium comprising Providence Resources Plc and PSE Seven Heads Ltd. over an area of approximately 380 square kilometres in the Kish Bank Basin off the Dublin-Wicklow coast.

The licence is for a six-year period with an obligation to drill an exploration well by August 2014. The licensees have not as yet submitted detailed proposals for drilling to my Department for approval and at this early stage of exploration activity it is far too soon to anticipate a commercial discovery that could potentially lead to a petroleum production project. In the event, however, that the proposed drilling on the licence was successful and resulted in a commercial discovery, profits would be subject to a tax rate of between 25% and 40%, depending on the profitability of the field.

Ireland's tax terms for oil and gas exploration and production are set at a level which seeks to maximise the financial return to the people of Ireland from our indigenous oil and gas resources while at the same time encouraging exploration companies to invest in exploration in the Irish offshore.

Ireland’s tax rate for oil and gas production is set at a level similar to countries such as France, Portugal and Spain which, like Ireland, have limited petroleum production and with which we compete for investment, rather than at a level comparable to countries such as the UK and Norway which are major petroleum producers.

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