Written answers

Tuesday, 9 June 2015

Department of Communications, Energy and Natural Resources

Exploration Licences

Photo of Thomas PringleThomas Pringle (Donegal South West, Independent)
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1134. To ask the Minister for Communications, Energy and Natural Resources regarding onshore licensing options granted to a number of companies in 2011, the reason the 31 March 2015 acreage report does not contain details of the licensing options granted to a gas company (details supplied); if he will confirm the status of those options and if those options were relinquished; if so, on what basis; if not, if the company has applied for another authorisation; if so, the nature and duration; and if he will make a statement on the matter. [22263/15]

Photo of Thomas PringleThomas Pringle (Donegal South West, Independent)
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1135. To ask the Minister for Communications, Energy and Natural Resources regarding the 31 March 2015 acreage report which states follow-on applications have been submitted for the onshore licensing option 11/1 granted to a company (details supplied), if he will outline the type of follow-on application that is under consideration; if additional authorisations have been granted; if so, if he will specify the type and duration of the authorisation; and if he will make a statement on the matter. [22264/15]

Photo of Thomas PringleThomas Pringle (Donegal South West, Independent)
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1136. To ask the Minister for Communications, Energy and Natural Resources regarding the 31 March 2015 acreage report which states follow-on applications have been submitted for the onshore licensing option 11/3 granted to a company (details supplied), if he will indicate the type of follow-on application that is under consideration; if additional authorisations have been granted; if so, if he will specify the type and duration of authorisation; and if he will make a statement on the matter. [22265/15]

Photo of Thomas PringleThomas Pringle (Donegal South West, Independent)
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1137. To ask the Minister for Communications, Energy and Natural Resources in the event of companies which discover commercially viable quantities of gas onshore applying for a petroleum lease, if the companies will be subject to existing licensing arrangements for offshore exploration and production; if so, if these authorisations will be subject to the 2007 licensing terms; and if he will make a statement on the matter. [22266/15]

Photo of Joe McHughJoe McHugh (Donegal North East, Fine Gael)
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I propose to take Questions Nos. 1134 to 1137, inclusive, together.

A licensing option confers upon the option holder the first right exercisable at any time during the period of the option to an exploration licence, or licences, over all, or part, of the area covered by the option.

The latest and previous acreage reports published by my Department indicate that in respect of onshore licensing options LO 11/1 and LO 11/3, the two companies exercised the right conferred upon them by the options and submitted applications for follow-on exploration licences. As a follow on application was not received in respect of LO 11/2 that authorisation is deemed to have expired.

In relation to the applications for follow-on exploration licences, I have made clear repeatedly that no decision will be made on these applications until there has been time for all interested parties to consider the outcome of the Environmental Protection Agency’s Research Programme into the use of hydraulic fracturing. This research is ongoing and is expected to conclude in 2016. In the circumstances, while it would be very premature to speculate about potential commercial discoveries in Ireland’s onshore area, I can confirm that the oil and gas fiscal terms provided for through the Finance Acts apply to both offshore and onshore areas.

Photo of Thomas PringleThomas Pringle (Donegal South West, Independent)
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1138. To ask the Minister for Communications, Energy and Natural Resources in view of the expiration of licensing option 11/3, San Leon Energy, in October 2013 and that the most recent acreage report states a follow-on application is under consideration, if he will explain what type of authorisation has been sought; the status of the application; and if he will make a statement on the matter. [22267/15]

Photo of Joe McHughJoe McHugh (Donegal North East, Fine Gael)
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An application for a follow on Frontier Exploration Licence from Licensing Option 11/3 is at an advanced stage of consideration by my Department. A Frontier Exploration Licence permits the exclusive right by the licensee to search for petroleum in the area to which the licence applies. If a Frontier Exploration Licences is granted in this instance, it would be for a period of fifteen years divided in four phases, with a work programme to be agreed in advance for each phase.

Photo of Thomas PringleThomas Pringle (Donegal South West, Independent)
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1139. To ask the Minister for Communications, Energy and Natural Resources if lease undertakings have been granted for petroleum exploration licences 4/05 and 5/05 in view of these licences ending in October 2011, if the companies found reserves of gas, oil, or both; what quantity of potential reserves have they indicated; if these companies will be granted a lease undertaking-petroleum lease; if so, what licensing terms will be applied; and if he will make a statement on the matter. [22268/15]

Photo of Thomas PringleThomas Pringle (Donegal South West, Independent)
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1140. To ask the Minister for Communications, Energy and Natural Resources regarding a company (details supplied|) announcing in March 2012 a commercially viable oil discovery in the Barryroe field (48/24-10z), if he will indicate whether the company has applied for a lease undertaking-petroleum lease; if so, the anticipated date for the commencement of production, and the licensing terms that are applicable to this authorisation; and if he will make a statement on the matter. [22269/15]

Photo of Thomas PringleThomas Pringle (Donegal South West, Independent)
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1141. To ask the Minister for Communications, Energy and Natural Resources the number of applications for lease undertakings his Department is currently considering; and if he will make a statement on the matter. [22270/15]

Photo of Thomas PringleThomas Pringle (Donegal South West, Independent)
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1142. To ask the Minister for Communications, Energy and Natural Resources the number of applications for petroleum leases his Department is currently reviewing; and if he will make a statement on the matter. [22271/15]

Photo of Joe McHughJoe McHugh (Donegal North East, Fine Gael)
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I propose to take Questions Nos. 1139 to 1142, inclusive, together.

Under the Licensing Terms for Offshore Oil and Gas Exploration and Development the Minister may enter into an undertaking with the holder of an exploration licence, or licensing option, to grant a petroleum lease in relation to a part of an authorisation where the licensee makes a discovery and is of the opinion, but cannot confirm at that time, that the discovery is commercial. Where the Minister concurs with this assessment, the Minister may award a lease undertaking, which will be subject to an agreed work programme that is aimed at establishing whether or not the discovery is in fact commercial. My Department is currently considering five applications for lease undertakings. The operator of standard exploration licence 1/11, which contains the Barryroe Field, has not applied for a lease undertaking.

Other than in a case where a declaration of commerciality has been made by the authorisation holder and accepted by me as Minister, it would not be appropriate for me to make specific comment on the petroleum potential of any area that is the subject of an exploration\appraisal authorisation, or an application for such an authorisation.

Where a commercial discovery has been established the authorisation holder is required to apply for a petroleum lease. Where such application is received, the Minister, if of the opinion that it is in the public interest, may demise such petroleum under specified acreage for such terms, conditions and covenants as considered appropriate. The Minister for Finance is a party to a petroleum lease. Any application for a petroleum lease must include the outline development, financial and marketing plans and outline environmental impact for the exploitation of the discovery based on the applicant's considered likely production profile. There are no such applications on hand in my Department as no oil or gas discovery has been established as being commercial in recent years.

The fiscal terms that apply to production from a petroleum lease are determined by the date of the award of the initial petroleum exploration authorisation, i.e. a licensing option, or exploration licence. Accordingly, production from a petroleum lease arising from an exploration authorisation granted in 2005 would be subject to the 1992 Fiscal Terms, while the 2007 terms would apply in the case of an exploration authorisation granted in 2011.

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