1 Executive summary Generations of Irish schoolchildren have TRANSFER OF OWNERSHIP AND CONTROL learned that Ireland lacks valuable natural Unfortunately, the terms under which Introduction resources. However, Ireland’s offshore ter- companies are granted permission to ex- ritory of 652,000 square km is nine times plore for these hydrocarbons are so heavily Ireland is at a crucial juncture in its approach larger than Ireland itself. Recent govern- weighted in favour of oil companies that the to energy supply. As global supplies of oil and ment and industry data – as well as discov- benefit to Ireland is almost non-existent. gas dwindle, more attention has focussed CONTENTS eries by oil companies – indicate the poten- The terms were introduced 20 years ago, on the prospects for these resources in Ire- tial for vast reserves of oil and gas under following heavy lobbying of the Haughey land’s offshore. The economic crisis has also Executive summary 3 this seabed. government by the oil industry. Under these prompted people to ask whether mineral re- According to a 2006 study for the gov- terms, when a company finds oil or gas in sources could offer a new source of wealth. How much oil and gas is under Irish ernment, the Atlantic Margin alone, off the Irish territory: Debate about Ireland’s oil and gas resourc- territory? 5 west coast, contains “potential reserves of • Ownership and control of that oil or gas es has progressed somewhat, due to pressure For how long can a company sit 10 billion barrels of oil equivalent (oil or is transferred in full to the company; from campaigners. There is a growing aware- on a licensed area? 8 gas).” At June 2012 prices, this is worth • No royalties are paid to the State; ness that Ireland’s licensing terms are highly €750 billion euro. This estimate does not • The company can choose to export the unusual, putting Ireland at the bottom of the How do Ireland’s terms compare to include the areas off Ireland’s south and oil or gas; international league table in terms of the other countries? 10 east coasts, where several valuable discov- • They do not have to land the resources State’s share of the revenue from the sale of eries have been made, nor does it include in Ireland or use Irish services or oil and gas – resources that belong, according What % of the value of Irish oil Ireland’s onshore. personnel; to the Constitution, to the State. or gas will return to the State? 12 For the purposes of this booklet, a de- • Even if the companies decide to sell in The oil industry and Irish Government no What is PRRT? 17 tailed map and tables have been painstak- Ireland, the full current international longer try to pretend that Ireland is resource- ingly compiled. These provide, for the first price will be recovered from the poor. They now concede that Ireland is very Options for Ireland 17 time, a detailed overview of all the pros- consumer; likely to have large reserves of oil and gas, but Table: Ireland’s most significant pects and discoveries in Irish territory, • Ireland has no ability to limit extraction now argue that the only way to get at it is to complete with the companies’ own esti- in light of the link between fossil fuels prospects & discoveries 20 transfer full ownership and control of those mates for how much oil or gas they con- and climate change. resources to private companies. Table: Other areas in Irish tain. The combined total of these company The only guaranteed benefit to Ireland Media coverage of, and political debate territory 21 estimates is almost 20 billion barrels of from extraction of these resources is a 25% around, this issue continues to be hampered oil equivalent. These tables and map are corporation tax on the profits declared from by a lack of information and by misinforma- Map: Oil & gas exploration & complemented by an extensive online re- the sale of the oil or gas. Before declaring tion. Politicians, economists and journalists discoveries Ireland 2012 22-23 source, including sources. profits, the company can write off 100% of have tended either to ignore the issue or to Security of supply 25 Even if a small amount of this is present costs against this tax, including the cost of represent it through a distorted prism created and recoverable, it will be an enormous stra- previous, unsuccessful wells drilled any- by the oil industry lobby. Ireland’s oil and gas and tegic asset for Ireland. However, due to an where in Irish waters and costs incurred Against this background, this information climate change 27 uninformed public debate and interference in other countries. (Following changes in booklet aims to provide an alternative source by the powerful oil lobby, we risk handing 2007, in exceptional cases a very large field How we got here 30 of reliable, referenced information for cam- over control and ownership of this asset to could incur an additional tax of between paigners, academics, trade unionists, politi- Fracking in Ireland 31 private oil companies, whose interests are 5% and 15% on post-tax profits. However, cians, journalists and anyone with an interest very different from those of the Irish public. this does not apply to the many licences in gaining a critical understanding of this sec- Corrib: a decade of resistance 33 The Irish government has been actively granted before 2007.) tor. This booklet does not seek to prescribe Human rights & Corrib policing 35 encouraging exploration in Irish waters. International studies show that State any one course of action, but does set out One of its aims is to turn Ireland from a ‘take’ in Ireland is among the lowest, several options for improving the situation. Opinion polls & the Corrib project 36 “net importer” into a “net exporter” of oil roughly half the rate of countries with a – Dublin Shell to Sea, July 2012 and gas. similar economic approach. An industry re- 2 3 port suggests the exchequer would earn as gas. As the map and tables in the centre little as 7% of the revenue generated from of this booklet show, companies are accu- the sale of the gas from an Irish field. In mulating scores of prospects, waiting for other words, Ireland effectively pays 25% international commodity prices to increase of the exploration and development costs, and the technology to extract to improve. but gains considerably less than 25% of the profits, despite owning the resource in FOSSIL FUELS AND CLIMATE CHANGE the first place. Improving Ireland’s licensing terms is not simply a case of substituting the Irish peo- WHY HAVE SUCCESSIVE GOVERNMENTS ple for private corporations as the benefi- MAINTAINED THESE TERMS? ciary of the extraction and burning of fossil The government and oil industry argue that fuels. However, under our current terms, the it is necessary to maintain these “attractive” decision about whether and at what rate to terms, because exploration in Irish waters extract such fossil fuels – in light of global is difficult, with a low success rate and be- climate change – is solely in the hands of cause Ireland needs to secure a domestic these private companies, whose only mo- supply of gas and oil. They also point to the tive is profit. importance of encouraging “inward invest- ment”. However, improved technology and WHERE TO FROM HERE? huge rises in the price of oil and gas mean Across the world, national governments it is now much easier and more lucrative to are redrafting their licensing terms for locate and extract these resources than it oil and gas exploration. In some cases, was when the terms were drawn up a quar- they are revoking or renegotiating exist- ter of a century ago. ing contracts with oil companies on the basis that these deals represented a cor- SECURITY OF SUPPLY rupt transfer of sovereign assets to pri- Ireland’s terms do not provide security of vate companies. supply, because they do not stipulate that Ireland is out of step with these global Ireland’s offshore territory is nine times larger than Ireland itself Irish oil or gas must be supplied to the Irish developments. However, it is not too late to (See map on centre pages, showing all discoveries and prospects in Irish waters) market, or even brought ashore here. Oil take action. In the se ction starting on page can be shipped abroad directly from the 10, we outline a variety of options that are rig, meaning no jobs, investment or supply available, based on the systems in place in in Ireland; gas found in the Irish Sea can other countries. How much oil and gas is under Irish be piped directly to the UK. Also, even if gas is supplied to Ireland, this will not help COLLATERAL DAMAGE territory? us in the event of an international crisis: The harmful consequences of Ireland’s as world prices increase, the price we pay pro-corporate approach to oil and gas are The story of Ireland’s oil and gas begins more nine times greater than its land area. This ter- for oil or gas from Irish fields will increase not purely financial: there are also severe than 200 million years ago. Oil and gas formed ritory contains several sedimentary basins that accordingly. social consequences associated with the from oceanic sediment containing the remains are geologically significant for hydrocarbon ex- mismanaged extraction of our resources. of microscopic algae or plankton, which drifted ploration. CAN WE NOT WAIT UNTIL MORE IS The final section of this booklet docu- down to the sea bed after their death.