Michael Colreavy (Sligo-North Leitrim, Sinn Fein) | Oireachtas source

Government party spokespersons sometimes claim Sinn Féin opposes only for the sake of opposition. That statement is inaccurate and unfair because it is the duty of an Opposition Deputy, or a Senator in the Seanad, to oppose legislation where it will be damaging to the people of Ireland, to propose amendments where he or she believes they would improve legislation and to support Government legislation where he or she considers it to be good. This morning I attended the launch by the Minister for Communications, Energy and Natural Resources, Deputy Alex White, of Ireland's broadband intervention strategy. I described it as a good day. I also gave some opinions on options the Minister and his officials might consider to help to ensure there will be a smooth and effective roll-out of broadband, which is very necessary throughout the country. That is good, constructive politics. The Minister of State will be glad to hear that this theme will continue tonight.

The Bill seeks to transpose EU Directive 2013/30/EU into legislation in this jurisdiction. I am aware that the directive was published two years ago and that it has only now been brought before the House. I know that the Department has a tight timeframe to get it through and the implications of not transposing it in this jurisdiction within the prescribed timescale. It is not an ideal way to pass legislation, but we are willing to work with the Minister of State to ensure the legislation is allowed to move as necessary. I would have liked more time to properly scrutinise and evaluate the outworkings of the legislation, but we will not obstruct its passage. I will, however, mention some of our concerns.

The subject matter of the legislation is oil and gas safety, a very pertinent subject in Ireland today. I do not think it can be argued that the State has a good record in dealing with offshore oil and gas safety operations. Most of what we have in legislation was designed at a time when there was no thought of oil or gas exploration or extraction, either off the coast or onshore. I considered the crossover between this legislation and planning legislation and reflected on the situation at Rossport. An example of where engagement with the community seriously failed was the Corrib gas project which had a damaging effect on the community of Rossport and caused reputational damage to Ireland throughout the industry and the world.

What happened at Rossport was important because it was a dispute about ownership and the use of natural resources. The local community regarded it as a threat to their well-being by a powerful coalition of State and capital, which raises questions about scalar politics and power. I do not know how that fits into planning legislation and the legislation we have in front of us, but locals opposed to the development at Rossport framed their opposition in terms of safety and health. They claimed that the pressure of unprocessed gas in the pipeline would be too high, that the pipeline would be too close to people's homes and that the environmental effects of gas transportation and processing would be devastating on the place, people and wildlife. They wanted the gas to be processed offshore. In that context, the statement that the risk was to be as low as was reasonable would have been very worrying to people alongside whose houses the pipeline was to be built. Some might see it as a statement that “This is the best we can do. Maybe your house should not be there in the first place.”

Local opposition in Rossport sparked major controversy about the manner in which the main company involved in the development, Shell, had behaved towards local host communities. Landowners who took issue with a high pressure pipeline running through their land protested against what they believed to be an infringement of their rights. As a result, in March 2005 Shell applied to the High Court for an order restraining landowners from interfering with the laying of the pipeline. An injunction was given and, as a result, five local people were imprisoned for interfering with the work of Shell. They became known as the Rossport Five and were applauded throughout many parts of the country. They certainly had my full support and that of my party. I looked to see if there was anything within this legislation to ensure what had happened at Rossport would not happen again and I did not see it. It was and is, clearly, a safety issue for people in Rossport. Many maintain that the Government was complicit in the failure to engage with the local community. They believe their concerns were ignored by the Government and State agencies and that private business was allowed a free hand in developing energy infrastructure as it wished. If I had had more time to consider this legislation, I would have looked for an impact of the TTIP and the ISDS in the event that they were agreed, but I did not have the time to pursue the matter in any detail.

Ireland's offshore oil and gas reserves have the long-term potential to be a significant source of revenue for the economy. According to a 2006 report carried out by the Department of Communications, Energy and Natural Resources but from which the Government sometimes backs away, there is the equivalent of approximately 10 billion barrels of oil off the western coast, composed of 6.5 billion barrels of oil and 20 trillion cu. ft. of gas. At current oil prices, this equates to a value of approximately €540 billion. While It is true to say the amount of oil and gas brought ashore has been small, there are these reserves. There is very little gas and no oil being extracted from Irish waters, but we need to keep in mind that there is this potential, which highlights the importance of this legislation. At some stage, that potential will be tapped.

We also need to keep in mind always that companies that discover oil and gas in Irish territory are not obliged to supply these resources to the Irish market. Not only that, our licensing terms are so weighted in the industry's favour, they do not require the companies to bring a single drop of our oil or gas ashore in Ireland. They can make that call. The State's licensing terms do not reward the country with fuel security. Companies can sell these resources on the open market. It is therefore wrong of any Government Minister, and it would be wrong of any Opposition spokesperson, to say if we do this it will help secure our energy future. We can make no such claims as long as the companies have the right to sell it off on the world market.

When the Government awards oil and gas companies with a licence, ownership and control of Irish oil and gas is transferred to that company. Under the current licensing terms, the Government cannot guarantee that the oil and gas will be sold to the Irish market, that the oil and gas will be landed in Ireland or even that the companies will use Irish workers. Irish consumers will continue to pay the full international price for oil and gas found off Ireland's coast. In a period when the world is nearing peak oil production, it is imperative that Ireland secures its fuel supplies. It is not part of this legislation but this is something we have spoken about before and something that needs badly to be addressed.

Under the 1992 and 2007 licensing terms, a 25% tax on the net profits of oil and gas is applicable. Against this, oil and gas companies can write off 100% of costs against tax, including costs incurred up to 25 years before field production begins and the cost of any unsuccessful wells the company has drilled anywhere in Irish waters in that 25 year period.

Under the 2007 licensing terms, a profit resource rent tax, PRRT, was introduced. PRRT is payable on a profit ratio calculated by the cumulative after tax profits on the specific field divided by the cumulative level of capital investment on the specific field. The profit resource rent tax has recently been adjusted so that larger finds will pay a 55% tax rate, which is good, but it falls far short of recommendations made by the Joint Committee on Communications, Natural Resources, and Agriculture that PRRT should be on a rolling scale of 40%, 60% and 80%, depending on the size of the find.

This Bill concerns offshore exploration and extraction but there is also such a thing as offshore fracking and I know the Minister of State would be disappointed if I did not mention hydraulic fracturing in my few words.

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