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Nationalise the Barryroe Oil Field

12/05/12

Oil rig at BarryroeOn March 23rd Providence Resources, the exploration company run by Tony O’Reilly Jr, confirmed that a gas and oil field located at Barryroe, 50 kilometres off the coast of Cork, is commercially viable. Better than expected tests have shown that the equivalent of roughly 6,200 barrels of oil can be gained in oil and gas from the site per day. With oil prices currently in the region of $100 per barrel this means the field could potentially produce $620,000 (€480,000) worth of gas and oil every day!

The Barryroe discovery has been heralded in the private media (much of which is owned by Tony O’Reilly Snr) as a great success for Ireland, providing a source of much needed income and employment for the country. This, however, is not true. Any profits made by Providence and its partners will be taxed at only 25 per cent (rising to a maximum of 40 per cent if the find generates super profits) one of the lowest hydrocarbon tax rates in the world. Private energy corporations operating in Norway for example pay a tax at a rate of 78 per cent on all production.

So, if the majority of the wealth generated by the Barryroe reserve is going to straight to its private owners, what about the jobs that the private media have promised? Here again all is not as it is presented. The work involved in developing the reserve will be contracted out to major foreign exploration companies, meaning virtually no local jobs will be created. The same nonsense was trotted out in relation to the Corrib reserve, which in reality will only provide 130 permanent jobs, hardly a great return on the tens of billions of euro worth of gas that Corrib will produce.

The end result of the current hydrocarbon exploration regime will therefore see vast profits for a tiny minority, with the majority of the Irish people, who actually own the gas and oil, getting only the scraps.

Speaking in relation to the Barryroe reserve, Cathaoirleach éirígí Brian Leeson said, “The Barryroe find comes as the Twenty-Six County state is in the throes of the worst recession it has ever experienced. All across the state people are struggling to survive on reduced wages, or worse still on reduced social welfare allowances.

“When falling incomes are coupled with increasing fuel prices it becomes increasingly difficult to afford the cost of home heating. Many simply cannot afford to heat their homes, even during the coldest winter months. Inadequately heated homes lead to many health problems such as respiratory illness and increased blood pressure as well as premature death. The reality of fuel poverty is now a fact of daily life for tens of thousands of Irish people.”

Leeson continued, “It is fundamentally wrong that so many people struggle to heat their own homes while major private corporations sell our oil and gas, making huge profits for their shareholders. The nationalisation of Ireland’s oil and gas reserves would not only alleviate the worst excesses of fuel poverty, it would also provide a vast pool of badly needed exchequer funds.

“That wealth could then be used to fund vital public services as well as being invested in economic recovery and the development of renewable energy technology. This state needs to follow the lead of countries like Cuba, Venezuela and Bolivia in taking back that which rightly belongs to the people. As recently as last month, Argentina took steps to retake control of that country’s oil reserves. The precedent is well established if only the political will existed to make it happen.”

 

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