Cost of Corrib protests
Sir, – The report in your newspaper on the latest protests over Shell’s development of the Corrib gas field that “the cost of developing the Corrib gas field could be four times the initial estimate of €800 million at more than €3 billion” (“Activists hold Shell protest”, Home News, February 2nd). Simultaneously, the project timetable has trebled from four years (delivery in 2007) to 12 (2015).
These overruns are due overwhelmingly to the protests against a project that was and is proceeding in full compliance with the democratic law of the land. The protesters do not like the law (which is their right), yet while the Garda has done its best to uphold the law and allow the project to proceed, it lacked the support of the political class who failed in their duty to defend the law. So the protests have been allowed to dictate the pace and nature of the project.
People may not be aware, however, that the massive cost overrun and delay have deprived Irish taxpayers of an enormous amount of revenue. Because Corrib’s 25 per cent corporation tax will be payable only after the project has recovered its (fourfold increased) cost, a process which can begin only when the gas starts to flow (eight years late), the tax take will have been destroyed to the tune of at least 75 per cent on a net present value basis, compared to the original plan. It is ironic that the protesters object that 25 per cent corporation tax is insufficient revenue for the State.
Nevertheless, that 75 per cent tax destruction is the burden that the protesters have placed on this bankrupt country. Their continued protests, which no-one now pretends are going to succeed in moving the processing plant offshore, are potentially destroying even more tax revenues. For no gain. – Yours, etc,