Cantillon

Inside the world of business

 

Reaction to the news that Providence plans to begin exploratory drilling 6km off Dalkey Island early next year was predictable: most people don’t want it.

The company intends to carry out a seismic programme, which will allow it to assess the area’s geology, a site survey and to drill an exploration well in the Kish basin. In short, it is embarking on the sort of standard exploration programme that such companies do every day in thousands of locations around the world, with no negative side-effects for anyone. The work is being done to establish whether there are commercial quantities of oil in the area. Providence is a long way from establishing that there are. If it does, it will have to go through a further round of licence applications.

However, it’s clear from the voices clamouring to join the debate about its plans at this early stage that the issue is already politicised. Tánaiste Eamon Gilmore, a TD for nearby Dún Laoghaire, said he would expect a public inquiry to be held into any future licence applications for the area by Providence.

Does this mean he expects a similar inquiry to take place should Providence make further licence applications in respect of Barryroe off Cork, where it has found commercial quantities of oil and gas? Or is Dalkey a special case? Or are his concerns tied to the fact that he shares a constituency with a political opponent, Richard Boyd Barrett, who is also against the project?

No special cases should be made. Exploration and production licence applications should all be treated consistently and transparently. Opposition to such projects is inevitable. Sometimes it’s justifiable, at other times it is not. But the world relies heavily on oil and gas for energy. The Republic is no different: 60 per cent of electricity used here is generated by burning gas. Transport in this State, including south Dublin, depends almost entirely on petrol and diesel. We import these fuels at considerable expense. Commercial reserves of either oil or gas would allow us to export them, at considerable gain.

Not in my back yard – or on the next balcony

The statement by Nama executive Felix McKenna at an Irish Council for Social Housing seminar in Athlone yesterday that the property agency has identified about 4,000 properties for social housing will be welcomed by many, though not all. The issue of social housing is a highly charged and politically sensitive one.

While most thinking people will agree that it makes sense for Nama to align public housing needs with its own suitable available properties, it appears that a severe case of Nimby (not in my back yard) is going on.

The issue of social housing provision is a major concern for apartment owners and management companies across the country.

With most apartment owners facing a large reduction in the value of their properties, many are concerned about the prospect of unsold units being used for social housing and the effect this could have on the value of their properties. Local politicians are being lobbied extensively.