Denis Naughten (Roscommon-Galway, Independent) | Oireachtas source

I thank the Cathaoirleach and Senator O'Sullivan for their good wishes.

Brexit is the most significant economic and social challenge for Ireland over the past 50 years. It will impact on our economy and society due to the close links between Ireland the United Kingdom. It has implications for everyone on this island, North and South. Many sectors of the Irish economy have high levels of trade with the UK. However, the energy sector has one of the highest levels of interdependence with the UK, and one of the key links is energy, as most of the energy we import comes via the UK. Natural gas is a significant part of our energy mix, meeting approximately one quarter of all our energy needs. We use natural gas to generate over 40% of our electricity, heat many of our homes and fuel a significant amount of our businesses and industry. In 2015, 97% of the natural gas used in Ireland was imported via the UK. We also have our own indigenous source of natural gas, the vast majority of which comes from the Corrib gas field, which started production at the end of 2015. In the short term, Corrib will supply over half of our natural gas needs. However, it is expected that these supplies will deplete over the next seven to eight years, and by 2025 Ireland will most likely again be reliant on the UK for around 85% of our natural gas needs.

The proper functioning of our economy and society is reliant on energy. As the report referred to by the Senator suggests, the issue of security of supply is extremely important, and preserving the existing structures with the United Kingdom is the best way to ensure this security. In this regard, the continued secure trade in energy between the United Kingdom and Ireland as part of the 27 member states of the European Union is a priority for me. I will work to ensure the current strong energy relationship with the United Kingdom continues but in the European context. Ireland is, and will remain, a committed member state of the European Union, and our energy future will be very much as part of the European internal energy market. I note that Ireland has an existing intergovernmental arrangement with the United Kingdom in regard to trade in natural gas across the two interconnectors connecting Ireland with Scotland. In addition to these bilateral arrangements, there are arrangements and protocols in place between the transmission system operators in Ireland and Great Britain.

Gas Networks Ireland is also in the process of doubling the onshore section of the gas pipeline in Scotland to further enhance the resilience of our gas supplies from the United Kingdom. The report referred to by the Senator goes on to state that in the absence of the existing structures with the UK, an LNG regasification terminal might be needed. LNG is one option that will be considered to ensure our security of supply. I agree that the potential benefits of importing LNG directly onto the island of Ireland, and also the role of natural gas storage, must be examined in the context of Brexit. Indeed, A Programme for a Partnership Government, agreed in May 2016, commits to examining if there are ways to facilitate LNG on the island of Ireland. This is in line with the Government’s energy policy paper, Ireland’s Transition to a Low Carbon Energy Future 2015-2030, which commits to conducting a thorough analysis of options for increased gas storage and LNG potential. My Department has recently commenced the process of developing a report to identify options in order to ensure Ireland’s resilience to a long-term gas and electricity disruption. Part of this report will identify potential options to improve resilience, including the potential for LNG, storage, interconnection and fuel diversification.

I share the Senator’s concerns and my Department and I are working to identify the appropriate solutions that are in the best interests of our people. We have a number of options available for LNG, both on-shore and off-shore options. We will explore all those options. I have spoken with my Latvian counterpart about the off-shore option that has been used and been hugely successful in Latvia in driving down the cost of energy. All these options are on the table. I know there is an issue at the moment with the development of the site in Foynes and the port company is dealing with that. Once those issues are resolved, we are quite willing to engage with the successful bidders to see how we can explore the progression of this project.