Revised estimates of Ireland's oil and gas resources

national | anti-capitalism | other press

Sunday May 27, 2007 15:28

by NMI

Some people are going to get richer on the profits from Irish resources.

It's pretty certainly a conincidence that the day after the news that same bunch will be running the country for the next while broke, an article appeared in Energy Business Review, pointing out how lucrative the huge reserves of gas and oil off the west coast of Fianna Fáil land will be.

Lucrative for the energy companies that is, not for the people of Ireland (unless you count certain people with different morals from the rest of us).

" Industry players developing the Atlantic Ridge reserves will no doubt be hoping to avoid the problems encountered by the developers of the Corrib field"

Ireland's upstream boom will produce significant opportunities

25th May 2007

By EBR Staff Writer

Recently revised estimates of Ireland's oil and gas resource endowments paint an upbeat picture of future production levels. If these latest estimates translate into the production levels forecasted, Ireland has the potential to not only meet its indigenous oil and gas needs but also to become a net exporter.
'Content Recent estimates published by the Irish Petroleum Affairs Division of the Department of Marine and Natural Resources indicate significant potential for future oil and gas production levels offshore Ireland.

The majority of these reserves are understood to be located in the Atlantic Ridge, a geological structure running parallel with the west coast of Ireland and part of the same geological formation as the North Sea reserves.

The fact that the Irish reserves are on this geological formation bodes well for their future development. The success of the Norwegian, Danish, Dutch and British fields at the other end of the structure is well documented. Closer to home, fields on the same structure such as Dunquin, which is estimated to contain 25 trillion cubic meters of gas and over 4,100 million barrels of oil, all increase the likelihood that the undeveloped reserves will be both technically and economically recoverable.

A recently published government report shows potential reserves of 130 billion barrels of oil and 50 trillion cubic feet of gas. Given Ireland's geographic location, there is significant scope for these reserves to be exported. Subject to the construction of suitable loading facilities, the oil can be relatively easily exported by tanker to anywhere in the world. The existing gas interconnection capacity with the UK could easily be reversed through the construction of new compression facilities, creating scope to export gas to the UK or even Continental Europe. Construction of LNG export facilities is also a possibility.

If developed, the Atlantic Ridge reserves would give a significant fillip to current indigenous production levels in Ireland. Currently, Ireland produces only a fraction of the gas and oil it needs, creating a significant level of import dependence.

Ireland's first indigenous gas reserves were discovered off the southwest coast in 1971 as a by-product of a search for oil. Currently, the majority of Ireland's indigenous gas production activity takes place off of the Kinsale Head area. Smaller levels of production are sourced from the Seven Heads area, although this development has been significantly impacted by technical problems leading to a rapid decline in output.

Industry players developing the Atlantic Ridge reserves will no doubt be hoping to avoid the problems encountered by the developers of the Corrib field, located 70km offshore the northwest coast. Corrib was first discovered in 1996 by Enterprise Oil and was the first significant new gas discovery in Irish wasters since Kinsale Head. In 2002, Enterprise Oil was acquired by Shell and the operating license of Corrib transferred to Shell, with the project owned by Shell E&P Ireland Limited (45%), Statoil (36.5%) and Marathon (18.5%). A long series of legal and planning related delays relating both to the project itself and associated infrastructure development have resulted in the project remaining years behind schedule.

If the new Atlantic Ridge reserves can be developed in a timely, cost-effective and streamlined manner, significant scope exists to transform the Irish energy sector and create a massive injection to the Irish economy.