Tommy Broughan (Dublin North East, Labour)
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Question 114: To ask the Minister for Communications, Marine and Natural Resources if measures will be forwarded to establish a strategic gas reserve; the reason Ireland is only one of three EU member states not to have such a reserve; his policy on further securing Irish gas supplies; the Irish production of natural gas; the amount of Ireland's supply of natural gas which is imported; the estimated reserves of indigenous natural gas left; and if he will make a statement on the matter. [2222/06]

Noel Dempsey (Meath, Fianna Fail)
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While Ireland does not currently maintain a strategic gas reserve, commercial reserves of natural gas are held by licensed natural gas shippers and suppliers, including BGE. Several other EU member states, including the United Kingdom, operate a similar regime.

I have been informed by BGE that, at current levels, its Kinsale reserves would supply 50% of non-daily metered customer requirements, that is, for small business and domestic use for up to 50 days. This is in addition to stocks held by BGE in the United Kingdom.

The Commission for Energy Regulation has responsibility for monitoring on an ongoing basis the security of natural gas supply. The commission publishes an annual gas capacity statement. This provides a seven-year rolling forecast of capacity, flows and customer demand to assess the adequacy of the Irish gas transmission system, including the interconnectors. The gas capacity statement also considers whether projected supplies of gas, from indigenous sources, imports and storage, are sufficient to meet forecast demand. A key finding of the 2005 gas capacity statement is that even under unusually cold weather conditions, the Irish gas transmission system will cope with forecast demand.

Bord Gáis Éireann, in its role as the natural gas transmission system operator, has developed contingency plans in the event of a curtailment in gas supplies. Those plans include switching gas-fired power generation plant to alternative fuels, seeking voluntary reductions from large industrial gas consumers and utilising BGEs reserves from the south-west Kinsale reservoir.

I am aware that the Commission for Energy Regulation, CER, is in discussion with Marathon Oil Ireland Limited about the development of commercial natural gas storage facilities at south-west Kinsale. It recently completed a public consultation on the proposed regulatory regime for the storage facility. Further consultation on a natural gas storage licence will commence shortly. It is planned that the storage facility will be operational by the middle of 2006. In the context of the all-island energy market development framework, the scope for a common North-South approach on storage and liquefied natural gas is also being jointly explored.

There is no EU obligation to establish or hold strategic reserves of natural gas. My Department is working to transpose EU Directive 2004/67 on measures to safeguard security of natural gas supply, which will further define the roles and responsibilities of gas market players relative to security of supply, in the context of the liberalised natural gas market.

Additional information not given on the floor of the House.

The directive also provides for the establishment of a gas co-ordination group to facilitate the co-ordination of national measures between member states in the event of a major supply disruption. The group met informally on 4 January in the wake of the Russia-Ukraine impasse and the group will meet regularly from now on given the need for the EU to co-ordinate more effectively on security of gas supply.

The 2005 gas capacity statement by the Commission for Energy Regulation shows that in 2004, 81% of Ireland's natural gas was imported via the interconnectors with 19% supplied by indigenous production. At the end of 2004, total remaining indigenous gas reserves in fields under production or development are estimated to have been approximately 960 billion cubic feet, that is, just less than a trillion cubic feet. Taking account of subsequent production the estimated remaining reserves at the end of November 2005 were approximately 940 billion cubic feet.

Tommy Broughan (Dublin North East, Labour)
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I thank the Minister for his reply and I send him best wishes for the new year and his last full year as Minister. The Minister referred to 50% of non-daily metered customer requirements being supplied by Kinsale. What does that mean? How much natural gas would this country have in the event of what happened between Russia and the Ukraine, which only lasted for a day or two, continuing and becoming much worse? The UK is completely integrated into the European gas network, effectively at the end of the pipe increasingly supplied by Russia. How long could we survive on Kinsale gas if another grave crisis occurred?

It has been European Union policy since last year to urge all member states to have a strategic gas reserve. What attitude did the Minister take in 2004 at the EU Council discussion on this matter? Was Ireland opposed to it? As far as I know, only three states, Ireland, the UK and Sweden, do not have strategic gas reserves. If we were to establish a further strategic gas reserve, how and where would it be done? What would be the responsibility for BGE and the CER?

We have a massive reserve off the north-western coast at the Corrib field. It is projected to be able to meet approximately 60% of Irish needs for ten years at a minimum. Everybody feels we must get that gas ashore by agreement with local people as soon as possible. In that context, I understand the Minister has the final report of Advantica Consultants. Will the Minister publish it and, if so, when? What reports has the Minister received recently from Mr. Peter Cassells, the facilitator for a resolution of the Corrib dispute?

Noel Dempsey (Meath, Fianna Fail)
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Regarding the question on strategic reserves, at present it is in terms of 50% of non-daily metered customer requirements, which includes small businesses and domestic, for up to 50 days. We use approximately 15 million to 20 million standard cubic metres per day during the winter gas demand period. Of that, approximately 9 million to 12 million standard cubic metres per day is power generation demand. Residential, industrial and commercial demand is approximately 3.5 million to 4 million standard cubic metres per day. The pipeline system itself, including the interconnectors and the ring main, contains a stock level of approximately 20 to 30 million standard cubic metres. The Kinsale field can produce approximately 1 million to 1.5 million standard cubic metres per day without storage and 4 million to 4.5 million standard cubic metres per day with storage.

The figures on which the newspaper report quoted by the Deputy was based were out of date. The claim that Ireland is one of only three EU countries which does not hold strategic reserves appears to arise from a report by the Austrian energy regulator. As I noted, the data in the original statement were not up to date and the figures quoted show the storage capacities within each EU state, rather than their strategic reserves.

The final part of the Deputy's question pertained to the Corrib gas field. While this is a separate issue in some ways , it is also closely connected. Its estimated gas reserves are in the order of 875 billion cubic feet. As the Deputy noted, these reserves have the potential to make a significant contribution towards Ireland's natural gas requirements. The immediate flow of gas would reduce our imports by approximately 60%.

As for the status of the Advantica report and the mediation process undertaken by Peter Cassells, he has briefed me twice. As recently as one week or ten days ago, he brought me up to date regarding the people he has met and the issues which have been raised. That was the last time I spoke to him. He has met officials from the Department a number of times and he estimates that he should provide me with final conclusions on the mediation process in the spring, over the next month or so. While the Advantica report is with the Department at present, as the Deputy is aware, the technical advisory group must make recommendations to me on the basis of the final draft report. I expect this to take place in the next few weeks and I will then consider them. However, the report will be published.