Richard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance) | Oireachtas source

The committee deserves considerable credit for producing this report and its recommendations. It deserves credit because this is a critical issue. However one looks at it and whatever view one takes on how or if we should develop our oil and gas resources, it is important that it is debated fully and that all the angles and aspects of it are understood, debated rigorously and that the wider public gets to understand fully the issues and different perspectives.

The report is welcome because it proposes a radical shift in how we manage the taxing and licensing of oil and gas development in this country. That is absolutely right because the current licensing and tax regime is an absolute scandal. There is no justification whatsoever for allowing the status quoto continue, whatever arguments the Minister might put forward to say we have no viable alternative and there would not be any exploration if we did not continue with the current arrangement. The truth is that as it stands, there is nothing in the regime for the people of this country or the economy except environmental risk and a trampling of local community and environmental interests by oil companies. Frankly, if the status quois the only option available, as the Minister suggests, we should leave it in the ground. That is how bad this regime is. The only beneficiaries of the current regime will be private oil companies, primarily multinationals.

While the committee deserves considerable credit for raising this issue, the biggest tribute in forcing the issue on to the national political agenda should be paid to the people of north Mayo and Rossport for fighting a heroic battle against one of the most powerful and nastiest companies in the world, Shell, for the way it has tried to trample a small rural community that has been treated disgustingly by this company. The community has been vilified by political and media interests in an outrageous manner. It is to their great credit that those people have fought to highlight just how nasty these multinational oil companies are and how little the people of this country stand to gain if these companies are allowed to have their way, as this Government and the last seem to wish.

I also pay tribute to Frank Connolly when he was chairman for the Centre for Public Inquiry and the fantastic report he did on Corrib and the great gas and oil giveaway that is involved in the taxation and licensing regime in this country. More recently, SIPTU produced an excellent report showing how we are effectively giving away our gas and oil resources. One of the latest publications that every journalist and TD should read, and I strongly recommend the Minister reads it, is the brilliant pamphlet Liquid Assets, which was produced by the Shell to Sea campaign and written by journalists and researchers. It is filled with evidence and references and explains the prospects for the discovery of oil and gas in the country, the oil companies' estimates and how much of a giveaway is the current taxation and licensing regime.

We should also pay tribute to the campaign in the Dublin Bay area, in Dún Laoghaire and elsewhere, against Providence Resources' plans to put an oil rig very close to the coast of Dublin. It was successfully beaten off by a campaign of people power. That campaign was motivated by the experience of Rossport and the trampling of the local community as it sought to highlight the giveaway of natural resources under the current regime.

We are discussing this subject because of people power. I underline that because those who get out and campaign, be they in Rossport or elsewhere, are never given the credit they deserve for forcing issues like this on to the agenda. The Minister for Communications, Energy and Natural Resources of all people should know and acknowledge that as a man who cut his political teeth in the resources protection campaigns in the 1970s where he made precisely the same arguments now being made by Shell to Sea, SIPTU and others about the potential give away of our natural resources. He argued at the time that we needed a regime that ensured real benefit to the citizens and economy and argued for a State company to manage the development of those resources. I do not understand how he has flipped to the degree he has from the position he once held.

Let us be clear and dispel some of the myths about the current regime. The State will not receive 25% tax from the development of gas and oil resources and it will certainly not receive 40%. It is more likely to be around 7%. Where does that come from? The CEO of Enterprise Energy, the original company doing the Corrib gas field development, which was then bought by Shell, Brian O'Cathain, spoke in the IFI after the take-over and he estimated the tax revenue to the State over the lifetime of Corrib would be €340 million, despite the fact the estimated value of the Corrib field is somewhere between €5 billion and €7 billion. The likely tax benefit to the State will be between 3.5% and 7% at most, depending on gas and oil prices. That is the reality. The reason for that is the tax write-offs, where every cent the multinationals have invested in the last 25 years, or any losses in any exploration done anywhere around the country, can be written off against tax liability, meaning that for small and medium-sized fields, it is possible they will pay no tax or it will be years before they pay a single cent because they could write off all losses and capital costs going back 25 years. That is the current situation.

In response to questions from me and others, the Minister constantly talks about security of energy supply to this country in trying to justify the current regime. There is nothing in the current regime that guarantees any security of supply. Shell, Providence, Tullow or whatever company is involved, is under no obligation whatsoever to provide a single drop of gas or oil to the country. Incredibly, if gas or oil is developed on any significant scale, we will not see any reduction in energy costs, it will be privatised and sold at market prices. If we are not willing to pay the market price, it will be sold on the global market.

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