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Donegal county council calls for the suspension of the current round of oil and gas applications

1 August, 2006


Today's announcement from Island oil and gas that they have discovered a significant gas find of the south coast of Ireland reinforces correct decision taken by the council.

Donegal County Council has unanimously supported a Sinn Fein motion calling on the government to ensure that any future oil and gas exploration licences are only granted when clear benefits can be guaranteed for the people of Ireland. The council also called for the suspension of the current round of applications that are due to be granted this week, until the terms and conditions attached to the licences are reviewed and a better deal struck for the people.

In welcoming the decision taken by Donegal county council, Cllr. Pearse Doherty said that today's announcement from Island oil and gas, that they have discovered a significant gas find of the south coast of Ireland reinforces the correct decision taken by the council.

Cllr. Doherty said,

"Donegal County Council's support for my motion is an important step forward in the campaign to insure that our natural resources that lie of our coast are not exploited by large multinational oil and gas companies but are instead harnessed with a clear benefit being brought to the Irish people. A clear signal has now being sent to this government that all parties on Donegal county council accept that there has been little benefit to the state in the granting of previous exploration licenses, and are now calling on the government to immediately address this disgraceful situation where our oil and gas reserves are being given away.

"I have consistently called on the government to suspend the Frontier Exploration Licenses applications off the coast of Donegal and have demanded an immediate review of the present terms and conditions that apply to these offshore oil and gas exploration licenses. I have done so because the current licensing terms for offshore oil and gas exploration are highly flawed and represent an extremely bad deal for the Irish People.

"Theses terms and conditions end any hope of Ireland benefiting from what nature has provided for her. The terms include an oil tax rate of 25%, the lowest in the world, all of which can be written off, it includes the abolition of royalties, which mean that we now have to buy our own gas back from these companies at the current market cost with no reduction to the state and it also has ended all other production- related levies. The fatal flaw in these terms and conditions is that there is no commitment by the oil companies to use any Irish jobs, goods or services. All of these initiates have resulted in that out of the 102 oil and gas producing countries, Ireland has the most generous terms and conditions for the oil companies in the world.

"In debating this motion the application from Grianan energy, the Donegal based oil exploration company was discussed, as an example of a company that agree that these licenses are a giveaway, and as a result have offered to allocate 10% of their profits to an independently run charitable trust that will invest this money in infrastructure, health and education projects in Donegal and the west of Ireland. While recognizing that this application offers a tangible difference to the other applications, it is my belief and as I stated during the debate on the motion, that the harnessing of our oil and gas must result in real benefits to the Irish and 10% of own resources does not go far enough.

"Therefore the only way to ensure that Donegal and other counties benefit is to change the term and conditions, to ensure that all companies that are allocated licenses pay their fair share to the state and also bring benefits to the local economy.

"Sinn Féin has consistently challenged the government to suspend this current round of applications which are only 30 kilometers of the Donegal coast until terms and conditions could be agreed that would benefit the Irish people. We need a major review of the 1992 legislation and until such times as this happens the Government must put the interests of the Irish People before the corporate interests of the oil and gas companies.

"The Marine Minister Frank Fahey, in 2001, said that in the event of a significant discovery off the Donegal coast during that year that the Government would seriously consider changing the 1992 oil and gas legislation. With today's announcement from Island oil and gas that they have discovered a significant gas find of the south coast of Ireland I now challenge the government to end the giveaway and live up to ministers Fahey's commitment of 2001.

"There is no doubt that with proper terms and conditions any oil or gas find of the Donegal coast would have massive benefit for Donegal. However it is reckless in the extreme for Minster Dempsey to issue new licenses without first carrying out a major review of the 1992 legislation. The time has come for this Government to start putting the interests of the Irish People before the corporate interests of the oil and gas companies. In the present economic crisis we must have a clear explanation from the government with regard to their handing over of potentially billions of euro worth of Irish resources that will be of little benefit to the Irish state and I and Donegal County Council are calling on the government to stop issuing licenses that will have little benefit to the state and to suspend these applications until a full review has been conducted." ENDS

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