Ispat faces legal action on clean-up

The Government has taken the liquidator of Irish Ispat to court to ensure he cleans up the former Irish Steel works.

Lawyers for a number of ministers expressed concern at the High Court yesterday that Mr Ray Jackson of KPMG is proposing to leave the Haulbowline site in Cork harbour later this week without making arrangements to ensure either the safe treatment or removal of radioactive material there.

The Ministers also claimed that while some £2.36 million (€3 million) had been paid over by the State towards the cost of certain environmental works, those monies were not spent by the new owners of the Irish Steel site in accordance with contract and that the condition of the site had deteriorated since 1996. Proceedings have been initiated alleging environmental hazard and contamination on the site.

It is also claimed that, since the State-owned Irish Steel became Irish Ispat Ltd, it and related companies have wrongfully caused unpleasant and noxious smells, gases and fumes and airborne sediment to escape to the property of the Minister for Defence at Haulbowline, Cobh and have further caused and failed to contain leachate generated from the steel works.

Mr James Connolly SC, for the ministers, secured interim orders from Mr Justice Kelly restraining Mr Ray Jackson, liquidator of Irish Ispat Limited, and various Ispat companies from vacating the site without first making adequate arrangements to secure and maintain the site and to deal with radioactive material there. The orders were returned to Thursday.

The judge also directed that the Radiological Protection Institute of Ireland should be contacted about whether licences held regarding radioactive material at the site are adequate.

The proceedings were taken by the Ministers for the Environment and Local Government; Finance; Enterprise, Trade and Employment; Communications, Marine and Natural Resources, and Defence against Irish Ispat Limited (in liquidation); Mr Jackson; Ispat Mexicana SA de CV and Ispat International NV.

The application arose following the sale by the State of Irish Steel to Ispat Mexicana, the parent company of Irish Ispat, in 1996. Ispat International NV, a Dutch-registered company, is the ultimate parent company of both Ispat Mexicana and Irish Ispat and it acquired the assets of Ispat Mexicana on an unknown date. The name of Irish Steel was changed to Irish Ispat.

In affidavits on behalf of the ministers, Mr Justice Kelly was told that, under the terms of the sale of Irish Steel under contracts of 1995 and 1996, the premises and lands at Haulbowline island, Cork Harbour, were leased to Irish Ispat Limited for 35 years.

Irish Ispat Limited had gone into liquidation and Mr Jackson was appointed liquidator. He had taken proceedings under the Companies Act to disclaim the 35 year lease. In the context of those proceedings, the State commissioned Enviros, a company of English environmental consultants, to investigate and assess the premises at Haulbowline, in particular to establish the types and levels of contamination present on the site.

Enviros had concluded in a report that the interior of the buildings and materials posed a "significant hazard" to the local environment and to health and safety. They also concluded there was significant hazardous material and significant environmental pollution on site as a result of the activities of the steel works.

In those circumstances, the present proceedings had been initiated against the Ispat defendants. Proceedings had also been issued under the Waste Management Acts against Irish Ispat Limited and Mr Jackson.