€1.5bn to be spent on Irish oil and gas finds in next three years

Four out of five surveyed by PwC optimistic about discovering oil off Ireland

About €1.5 billion will be spent on oil and gas exploration around Ireland over the next three years, according to a study by accounting group PwC.

Eighty per cent of those surveyed said they were optimistic about the chances of discovering oil here but almost two-thirds said the future development of the industry would depend on the licensing and financial terms offered by the Government.

Nine out of 10 respondents said the "events" in Corrib, where Shell has been seeking to develop a natural gas field since 1996 against a backdrop of significant local opposition, had done "serious or significant damage" to Ireland's reputation among international oil and gas companies.

The department of communications, energy and natural resources estimates that there are at least 10 billion barrels of oil equivalent to be found in Irish waters.

‘Moderate optimism’

Just over half of respondent expressed “moderate optimism” in relation to the level of oil yet to be discovered here while 28 per cent said they were “highly or very highly” optimistic about the level of potential reserves. One in five of respondents declared a low level of optimism.

Of those surveyed, 43 per cent said they would be recruiting up to five staff each in the next year.

The report states that this was “encouraging” as employment in this early stage of exploration “tends to be low” while a lot of work is sub-contracted to companies who were not polled for this study.

Half of the respondents said the Port of Cork was most likely to benefit from investment in exploration given its close proximity to the Porcupine Basin, which is most favoured for drilling activity. Shannon Foynes was cited as the next most likely to benefit.

Half of the foreign companies that participated in the survey said they would like the Government to make available all of the seismic data collected to date.

“Doing so would reduce the risk involved by allowing exploring companies to make more informed decisions as to where to focus their activity,” the report states.

The survey was carried out in March and April with 56 Irish and foreign companies responding.