Prospect of new offshore licensing round hinges on firms' `commitment'

The Minister for the Marine and Natural Resources, Mr Fahey, intends to initiate a new licensing round for petroleum exploration off the west coast if there is sufficient commitment from the industry.

Strong energy prices and the current liberalisation of both the oil and gas markets should encourage the industry to "be more bullish" in relation to exploration in Ireland's Atlantic frontier areas, the Minister said yesterday. He intends to consult with the industry on interest in two regions - the first encompassing the north-east Rockall and south-east Rockall areas, and the second covering the north Porcupine and south Porcupine.

The Minister said the initiative was "aimed at both conserving areas of the Irish offshore and gauging interest on the part of the industry in making well commitments in certain other limited areas".

As a first step, the Slyne/Erris/Donegal/Malin area will be closed for licensing from December 31st of this year.

Apart from Enterprise Oil on Corrib North and the Shannon prospect in Erris/Slyne, there have been few exploration wells drilled off the west coast of Ireland since 1997 and the industry is reluctant to spend on other drilling and exploration activities.

Statoil's Sarsfield oil prospect in the Porcupine Basin and its Ceide gas prospect on Erris Slyne remain the only two "bullish" prospects for the coming season, according to Mr Michael Cunningham, an offshore oil and gas consultant based in the west of Ireland.