The Petroleum and Other Minerals (Amendment) (Climate Emergency Measures) Bill 2018, which is undergoing Oireachtas scrutiny, has heightened discussion around Ireland’s energy requirements.
We need to seriously address the challenge of the transition to a lower carbon future while supplying cleaner, affordable and secure energy to a growing population and economy.
The Irish Offshore Operators’ Association is committed to addressing that challenge. However, we have major concerns over the substance and practical impact of the bill.
Instead of tackling climate change, we believe that the bill if enacted would reduce energy security, have a negative economic impact and most importantly would not reduce emissions.
Discussions of long-term energy strategy must be realistic and cognisant of the facts of energy supply and demand.
Global energy demand is set to grow 30% by 2040 due to population growth and rising living standards.
As we transition to a lower-carbon future, oil and gas will remain vital energy sources. In Ireland, fossil fuels account for 92% of primary energy supply.
The Corrib field provides just over half of our gas needs, but this production will naturally decline, with the result that gas imports will increase unless we find new replacement sources.
Furthermore, the Kinsale Head gas field will soon be decommissioned. Renewable energy sources such as wind and solar are intermittent in Ireland. Therefore, although renewable contributions are growing, Ireland has no other reliable energy source that can provide the necessary backup for when the wind doesn’t blow, or the sun doesn’t shine. Natural gas provides this backup, as well as playing a major role in substitution for higher greenhouse gas-emitting energy forms. Oil will continue to be important for aviation, shipping and haulage.
Our geographical location makes Ireland vulnerable to potential interruptions in energy supply. Ireland has no direct link to mainland Europe’s gas or power networks. Almost three-quarters of the fossil fuels used here are imported, with gas delivered from Scotland via the interconnectors.
There is rising dependence in Europe on oil and gas imports from Russia and Africa. Like many other sectors, our energy supply challenges will be further compounded by Brexit.
Not only would this draft legislation be damaging to Ireland’s energy security and supply by stopping the search for Irish offshore oil and gas, it would also damage our economy at a time when there is real momentum in investment by major international companies.
The direct tax take to the State from a single commercial oil discovery under the 2014 revised fiscal system is estimated to be in the range of €4bn to €8bn.
Irish natural gas has transformed the energy and economic landscape, with considerable job impacts and value add-ons especially in coastal regions. Corrib provided up to 1,400 full-time jobs during the construction phase and will contribute around €6bn to Ireland’s GDP over its lifecycle.
The proposed legislation will do nothing to meet Ireland’s emissions reduction targets, and would only serve to increase global emissions due to the increased importation of oil and gas.
Ireland’s energy strategy must be realistic. We need to transition to a lower-carbon future. This transition should be measured, realistic and systematic. Renewables should be developed in parallel with exploring for our own offshore oil and gas resources to provide independent energy supply. Ireland needs secure oil and gas and significant potential for that lies in the under- explored Irish offshore.
Pat Shannon is chairman of the Irish Offshore Operators’ Association