Ireland is oil-rich says BBC

[C. Flower]

A good clear report from the BBC. The media here never seem to manage to spell out the basics on our oil situation.

Providence intends to attract multi-national energy giants to "farm in" to its licence, which it bought from the Irish government for a nominal fee.

The company has already secured the expertise of the world's leading oil multi-national, Exxon Mobil, to explore its site at Drumquin.

However, campaigners have said that Ireland's relaxed laws with regard to its natural resources ought to be overhauled.

Ireland takes 25% of all profits, rising to 40% depending on the volume extracted.

Ireland's Energy Minister Pat Rabbitte concedes that the take is much lower than in the UK, or Norway, both of which have much greater resources of oil and gas.

But he says that the rate must remain attractive to foreign companies as Ireland does not have the expertise or revenue to exploit the reserves itself.

Others point out that all exploration costs can be off-set against any tax liable ones, and that a claim can go back as far as 25 years.

Providence is believed to have spent £0.5bn exploring Irish waters.

Campaigners like William Hederman, of Irishoilandgas.com, have warned that the oil from Barryroe may never be landed in Ireland, but instead taken for refinement to Europe or beyond, meaning fewer jobs on Irish soil.

[C. Flower]

The "most read" WSJ article in Europe at the moment.

Ireland is struggling to recover from a collapse in its property market that caused a banking crisis and forced the government to seek an international bailout. The country has undergone five years of economic austerity while unemployment has soared to 14.8%, more than three times as high in 2007, when the boom turned to bust.
Production at Barryroe may reach a peak level of 100,000 barrels a day for each platform installed on the field, and it would be possible to build several platforms, depending on the level of investment, the company said.
Ireland consumed 142,000 barrels of oil a day in 2011, but produced none, according to the BP Statistical Review of World Energy.
Barryroe was last estimated to contain as much as 1.7 billion barrels, but there was no projection of how much of that could be recovered. The recovery rate announced Wednesday is better than many analysts had forecast.
The estimate of recoverable reserves from Barryroe was probably fairly accurate and Providence should be able to develop the field using well-established industry techniques, said Stuart Joyner, an analyst at Investec.
"It's not really challenging," Mr. Joyner said. "It's well within the industry envelope of knowledge."
Providence, a Dublin-listed company with a market capitalization of €564 million euros ($727 million), said it is seeking partners to help fund development costs estimated at around $15-$20 a barrel, or $4.2 billion-$5.6 billion for the entire field, according to a spokeswoman for the company.

More detail -
http://online.wsj.com/article/SB1000...s_mostpop_read

[Baron von Biffo]

Happy for the lot to be exploited and absconded with with no benefits to people in Ireland ?

The loolaa outfit in Tullamore is blocking the provision of public infrastructure that would benefit the people because they believe the wishes of a plantation owner are more important.

[Apjp]

The way the article waffles on you would swear we could solve the national debt problem. Give it all to the Germans!

There is as of next year, no deficit except for debt interest repayments. That problem would be quite easily solved. Of course I know the Biffos of this world want us to pay 'our' debts but the fact remains as well that Ireland is a very rich country according to OECD figures. The state, with its lax tax laws, may be broke but the country is most certainly not.

[Apjp]

Happy for the lot to be exploited and absconded with with no benefits to people in Ireland ?

The Biffos of this world are happy with anything FF did and the current shower continue doing.

[disability student]

All of the development costs are written off before they could start tax on profits.

Norway's tax on exploration is 78% inclusive of development costs.

I find it hard to believe it as O 'Reilly has form re false dawns/alarms re oil finds way back to 70's.

I rather see an independent assessment by an expert with no ties or bias re that find.

[morticia]

I think many are too pessimistic about this. Transporting a large quantity of oil a long way away for refining increases cost in terms of energy to pump and ship it. In reality, if we have 1.7 bn barrels,it will end up being refined in Cork, which is the home of our current chemicals industry as it is. If the find is smaller, maybe this won't be true, but in that case, we have less benefit anyway. Providence has spent half a bill prospecting in Irish waters; I for one don't have a problem with them writing some of that off against tax. We have to remember the oil business is both expensive and risky and currently liable to the law of diminishing returns, at least in the sense that most large easy finds were located a few decades ago. While I'd agree that there are legit concerns, the Irish taxpayer might have seen a lot more return from the likes of, say, Corrib, if it hadn't cost so much to police. Let's learn from that one, shall we? Especially since offshore is likely to be a lot less polluting than fracking. I am not optimistic, however, that our protesters are about to discriminate between the two intelligently. Sigh.

[Yojimbo]

I think many are too pessimistic about this. Transporting a large quantity of oil a long way away for refining increases cost in terms of energy to pump and ship it. In reality, if we have 1.7 bn barrels,it will end up being refined in Cork, which is the home of our current chemicals industry as it is. Sigh.

Whitegate is designed to refine just one form of crude - light low sulphur oil. Its a relatively unsophisticated refinery and would be very expensive to upgrade if the Providence find was of another grade of crude. There is no guarantee that any oil find would be of a grade suitable for Whiltegate, so there is every chance it will be tankered off to another country. If this was the case, then the gain to the Irish economy and exchequer from the oil would be minimal (there is probably gas with the find,that would be a significant benefit, especially as all the infrastructure is already in place).

[MPB]

Whitegate is designed to refine just one form of crude - light low sulphur oil. Its a relatively unsophisticated refinery and would be very expensive to upgrade if the Providence find was of another grade of crude. There is no guarantee that any oil find would be of a grade suitable for Whiltegate, so there is every chance it will be tankered off to another country. If this was the case, then the gain to the Irish economy and exchequer from the oil would be minimal (there is probably gas with the find,that would be a significant benefit, especially as all the infrastructure is already in place).

If that is the case, the tax laws will have to be changed accordingly.

By right it is our oil and gas. They are being allowed extract it and profit from it,s extraction. They have no right to steal it and they will not be allowed to pipe it, refine it, or transport it, without us getting most of the profits.

Any Govt that allows them to do so, won,t last hanging time.

[bokonon]

Discovery of oil off the southwest cost of Ireland has prompted talk of it being great news for the Irish economy. It could certainly do with some. But the announcement that known oil reserves are commercially recoverable is unlikely to offer any great boon to the economy as a whole. There may be a bonanza, but it will be only for a small coterie of Irish banking, property and oil tycoons who continue to benefit from the state's largesse while most of the population struggles in the fifth consecutive year of economic slump.
...
If Ireland is to benefit from an oil boom it needs to look to Chávez, not to Thatcher.

http://www.guardian.co.uk/commentisf...y-irish-people

[fluffybiscuits]

I think many are too pessimistic about this. Transporting a large quantity of oil a long way away for refining increases cost in terms of energy to pump and ship it. In reality, if we have 1.7 bn barrels,it will end up being refined in Cork, which is the home of our current chemicals industry as it is. If the find is smaller, maybe this won't be true, but in that case, we have less benefit anyway. Providence has spent half a bill prospecting in Irish waters; I for one don't have a problem with them writing some of that off against tax. We have to remember the oil business is both expensive and risky and currently liable to the law of diminishing returns, at least in the sense that most large easy finds were located a few decades ago. While I'd agree that there are legit concerns, the Irish taxpayer might have seen a lot more return from the likes of, say, Corrib, if it hadn't cost so much to police. Let's learn from that one, shall we? Especially since offshore is likely to be a lot less polluting than fracking. I am not optimistic, however, that our protesters are about to discriminate between the two intelligently. Sigh.

Perhaps Corrib is acting as some sort of warning to the future of the Irish oil industry so much so that Cork Chamber of Commerce have formed an interest group to look into the prospects of what to do with the oil. The Irish Examiner reported two weeks ago(ish) that there is an interest group formed with the Provident having some staff on the board of this group (http://www.irishexaminer.com/busines...ef-209792.html). They have said they will carry out an environmental assessment of the situation but will this be impartial? Remember that Uni of Aberdeen were looking at fracking and its impact but they had links to Shell which I and other members of Frack off Ireland mentioned to Minister Rabbite. If tehre is an assessment to be carried out it must be independent.

[Fraxinus]

It is bittersweet in more ways than one....it's terribly disappointing how much oil we still consume here, even in a recession, and how little a dint has been made by renewables, the other side of course is potentially becoming self sufficient.
Then there is the potential to use the resource for the benefit of the state but more likely is the usual plundering, smash and grab..enriching a few collaborators here and many king pins abroad.

The environment will cry, the apathetic Irish will sigh and the boys in suits will grin like monkeys.

[fluffybiscuits]

It is bittersweet in more ways than one....it's terribly disappointing how much oil we still consume here, even in a recession, and how little a dint has been made by renewables, the other side of course is potentially becoming self sufficient.
Then there is the potential to use the resource for the benefit of the state but more likely is the usual plundering, smash and grab..enriching a few collaborators here and many king pins abroad.

The environment will cry, the apathetic Irish will sigh and the boys in suits will grin like monkeys.

There is a lot of local objections to renewable energy because of the worries over the noise from windfarms. The issue is particularly big in Wicklow and Dublin Mountains where a lot of these wind farms are located. There is going to be the usual few companies and individiuals who come in though, take the resources and they will move back to their palaces and we wont see one iota of this money at all. Perhaps there should be a clause where 5% of all profits go towards a charitable cause or social issues be alleviated.