Oil find off coast of Cork

[Chris]

Excellent and well researched posts One!

Protestors say that the government has given away €580BN of Irish resources. I would love for them to point to exactly where those resources are, who owns them, and what wells all these resources are been taken from! The reality is that the figure of €580BN has been proposed by some loony toon of an economist and then circulated as a truthful respectful value.

That point always baffles me. It is like they are arguing that the energy companies simply pull up with a boat and load up some resources. By the same line of argumentation you could say that a cabinet maker selling a wooden cabinet is exploiting us because he is taking Irish resources (wood) and then not returning all/most of the profit to the government. If it were that simple to make a profit in Irish oil and gas then even politicians should be able to do it themselves.

The government gives as many incentives as they can to invest.

I would rephrase that and say that the government simply gets out of the way, which makes things easier for the companies involved. When politicians talk of incentives it always sounds like their actions bring on a positive outcome, when in fact it is their inaction that results in the positive effect.

Sorry, but I don't know how you can credibly justify that remark.

I agree. Oil companies are in the business of making profit, and just like any other company, business expenses should be written off against tax. It would make no sense whatsoever to increase exploration and shutting down costs to such an extent as to declare zero profit. the more profitable an investment is the better it is for the owners.

 

[Purple]

I'm not sure what your posts are getting at, I don't deny that we needed incentives I just think we gave too much away in haste, so much so that I don't think we ever really get the full benefits of the drilling either in direct taxation or in direct and secondary services.

If the deal is that good then why isn’t the West coast full of exploration rigs?

The reason why Ireland has become more interesting to the oil companies is filled with technical developments and political. The government moved too soon and didn't realise that they would actually have the upper hand.

Same answer; why isn’t the West coast full of rigs?
The recovery technology has improved but that also makes it easier to access oil in other locations (and re-visit old reserves). The fact is that ultra- deep water drilling is very expensive and there’s lots of oil that’s cheaper to get at, especially since oil shale recovery technology (Fracturing) has been developed.

It isn't new that there are reserves off the coast, it has just always been the case that the technology didn't exist to find and access those reserves in an economic fashion. Here's the crunch (and why the Mars analogy was right): they developed the technology so that they could get at those reserves, they wanted to and want to get it.

The Mars analogy is correct but you’re forgetting that there’s still loads of oil here on Earth.

It wasn't a case that the government went begging for the companies to come here, they were already interested, but needed convincing as to the finer details. Burke and then Ahern jumped the gun and went in with a very low offer.

And that's the argument, not that there shouldn't have been incentives, just that the deal shouldn't have been so biased to the other side. That perhaps some greater consideration should have been given (than I can see) to the actual pay back period for the state.

Back to my first point; if the deal was that good then why is there so little exploration taking place here?

 

[Purple]

I just found this from Ronan Lyons.

 

[dockingtrade]

Isnt Rockall where all the oil is and we'll have to got to war with britain, iceland and denmark to get it

 

[One]

One,

I'm not sure what your posts are getting at.

I don’t mean to niggle at anyone. It is just that this subject has caused a lot of tension, fighting and bad feeling where I live. I can’t understand why high-profile economists, journalists, well paid T.D.s, etc., can go on television and say things that are not true. It is a sore topic. This thread was one place where at least I could have my say. I probably went on too much. No offence meant.