Our Oil and Gas
Why do articles that discuss Irelandâ€™s poverty conceal Irelandâ€™s riches?
Ireland has at least â‚¬ 5.4 trillion euros ($7.38 trillion) worth of oil and gas reserves off its western coast â€“ which is enough to pay off Irelandâ€™s national debt of â‚¬ 60 billion nearly a hundred times over.
A report by Petroleum Affairs Division of the Department of Communications, Marine and Natural Resources stated: â€œVolumetric assessment and expulsion modeling shows volumes of over 130 billion barrels of oil, plus 50 trillion cubic feet of gas off Ireland. At minimum, the potential is at least 10 billion barrels of oil, most of it in an underwater ridge known as the Atlantic Margin, which runs parallel to Irelandâ€™s western shore.â€
The Dunquin gas field, 125 miles off the coast of Kerry, contains 25 trillion cubic feet of natural gas, plus 4,130 million barrels of oil. This alone would meet Irelandâ€™s gas needs (at present consumption levels) for the next 62 years.
The Spanish Point field, 125 miles off the coast of Clare, has known reserves of 1.25 trillion cubic feet of gas, plus 206 million barrels of oil.
Further north lies the Corrib field, with an estimated value of between â‚¬ 6 and â‚¬ 50 billion euros ($8.2 billion - $68.4 billion).
The Lough Allen basin (an inland field) has 9.4 trillion cubic feet of gas, plus 1.5 billion barrels of oil valued at â‚¬ 75 billion euros ($102.6 billion).
Ireland has so much oil and gas that the masses need not submit to the IMF. So whatâ€™s the problem?
The problem is that Irish politicians intentionally locked up this oil and gas wealth by selling contracts to foreign oil companies, which take 95% of the profits, and give kickbacks to the politicians that wrote the contracts.
For example, Exxon Mobil is developing the Dunquin field, while Shell, Marathon and Statoil are developing the Corrib field.
These companies get all the money. Corporations harvesting the Corrib gas fields need pay only 25 percent of the profit to Ireland, and most of that 25% is withheld as exploration and operating costs.
Result: Ireland collects only 5% of the profits from its own oil and gas.
Oil companies whine that they must pay about â‚¬ 70 million euros each time they do an exploration drill. But if they must drill â€“ say -- 1,000 exploration wells to exploit all of Irelandâ€™s oil and gas reserves, then for â‚¬ 70 billion they get a 71-fold profit of â‚¬ 5 trillion. This is like getting $3,550 from an investment of fifty bucks. Not bad.
The Irish masses want the government to re-negotiate its contracts with foreign oil companies â€“ but that would mean less kickbacks to Irish politicians. Hence the politicians (especially those of the ruling Green - Fianna FÃ¡il coalition) insist on taking IMF debt, since politicians will not have to pay for it. The masses will.
Investors see all this, and are buying oil futures, knowing that IMF debt (which taxpayers, not investors must repay) will backstop the investorsâ€™ gambles. Consequently the price for West Texas Intermediate crude futures has hit $83 a barrel, and continues to climb.
The Irish masses could demand more money from corporations that are extracting Irelandâ€™s trillions in oil and gas. The masses could also reign in the speculators, and have a genuinely public bank. They could all share in prosperity.
But for that to happen, Ireland would need honest politicians.