Robert Troy (Longford-Westmeath, Fianna Fail)
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To ask the Minister for Communications, Energy and Natural Resources in view of estimates of over a billion barrels of oil in the Barryroe Oilfield, his plans to maximise the benefit to the State of such resources; and if he will make a statement on the matter. [53271/12]

Fergus O'Dowd (Louth, Fine Gael)
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It is a core policy objective of my Department to maximise the benefits to the State from exploration for, and production of, our indigenous petroleum resources, while at the same time ensuring that activities are conducted safely and with due regard to their impact on the environment and other land/sea users.

In relation to the Barryroe oil discovery, results of tests carried out earlier this year on the Barryroe appraisal well are encouraging, however further appraisal work will be required to determine if the discovery could be declared commercial and lead to a petroleum production project. In the event that Barryroe were to be declared commercial and advance to the production stage then under the 2007 fiscal terms a tax rate of up to 40% would apply. Additional benefits would flow from the economic activity generated by a new development project.

The fiscal terms, which were last revised in 2007, seek to strike a balance between maximising the financial return to the State and the need to set the terms at a level that will encourage mobile international exploration investment to the Irish offshore. While there have been some positive indicators in terms of a modest upswing in the number of exploration companies active in the Irish offshore over the past decade, the last discovery to be declared commercial was the Corrib gas field which was discovered in 1996. Without a substantial increase in the level of drilling activity in the Irish offshore, from the current level of about one well per year, the true potential of our natural resources will not to be proven.