Commercial gas is set to flow from the field off the Co Mayo coast in the middle of next year after a series of delays.
The partners in the project — Shell, Statoil and Vermilion — are expected to spend an additional €300m on the project this year to bring the total spend to €3.4bn by the end of this year.
Now, new accounts filed by one of the partners project — Canadian-based firm, Vermilion Energy Ireland Ltd — show that the volume of gas at peak production will be 8% more than originally believed.
The directors’ report reveals that successful sub-sea operations off the coast of Co Mayo were conducted during the third quarter of 2013 and as a result, Vermilion stated that it is increasing its peak production estimate at Corrib from 9,000 barrels of oil equivalent per day to 9,700 barrels net to Vermilion.
Vermilion has an 18.5% share in the field and it states that the gas field is expected to constitute 95% of Ireland’s natural gas production and 60%-65% of Ireland’s domestic gas consumption.
The results of the survey are welcome news for the partners in the project who have encountered a succession of delays and consequent budget over-runs.
Gas was originally expected to flow from the field in 2003; resulting in the project likely to be 12 years behind the original schedule and the outlay being more than four times the initial estimate of €800m.
Around 1,000 people are employed in the project and work is continuing on putting in place the 72 pieces of pipe into the 5km tunnel that is to bring the gas ashore to Bellanaboy gas processing terminal.
At the terminal, preparations are being made for a pre-start up testing programme using “back feed” gas from the national grid. This commissioning programme is due to commence before the end of the year.
The 2013 accounts for the Irish unit of Vermilion show that it recorded a pre-tax loss last year of €43m.
However, a tax credit of €10.96m reduced the firm’s losses to €32.1m. Accumulated losses totalled €235.6m at the end of the year.
However, a share premium account of €255.7m and share capital of €33m combined to give shareholder funds of €53.1m at the end of last year.