Ruairi Quinn (Dublin South East, Labour)
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Question 35: To ask the Minister for Communications, Marine and Natural Resources if he will report on the review of the fiscal scheme for hydrocarbon exploration and production that is currently taking place in conjunction with the Department of Finance as outlined in the new Energy Green Paper; when he expects to complete and publish the review; and if he will make a statement on the matter. [33406/06]

Gay Mitchell (Dublin South Central, Fine Gael)
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Question 104: To ask the Minister for Communications, Marine and Natural Resources his plans to update or review the oil, gas and other exploration licensing regime with a view to achieving a fair and acceptable level of return for the economy and exploration companies; and if he will make a statement on the matter. [33555/06]

Noel Dempsey (Meath, Fianna Fail)
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I propose to take Questions Nos. 35 and 104 together.

The review is being conducted in two stages. The first is an analysis by my Department as follows:

An evaluation of the current fiscal framework as an efficient means of increasing long term investment and revenue generation in the petroleum sector for the benefit of both the Irish State and investment from oil companies;

A review of the non-fiscal licensing terms under which licences are awarded. These terms would include inter alia the duration, fees, work programme, exploration commitments;

An examination of the current Irish terms as an effective and robust taxation system that best reflects the public interest.

A review of alternative options to the current system.

Recommendations for changes applicable to future licences.

The second stage is an independent expert review of that analysis. My Department has engaged Indecon to review the work undertaken internally. The external experts terms of reference are as follows:

Consideration of the Department's views on how the licensing regime could best be changed, as set out in two reports covering fiscal and non-fiscal terms respectively.

Advice on any alternative fiscal regimes which could better achieve the objectives.

Advice on peer countries (comparable in terms of size or petroleum development) considering relative tax and royalty burdens and other licence terms vs. objectives.

A quantitative analysis of the preferred regime (underlying model, specific details – thresholds, rates etc.).

Advice on any additional non-fiscal features considered beneficial to the State.

The report of the independent experts is due in early November.

Regarding licensing and development of minerals regulated by the Minerals Development Acts 1940 – 1999, a review of the current licensing regime will be undertaken following enactment of a comprehensive new Minerals Development Bill being drafted by the Office of the Parliamentary Counsel to the Government. In the meantime, the current system will continue.