Corrib gas project overruns denies State €600m in tax revenue
The cost overruns on the controversial Corrib gas Shell refinery project in north Mayo will deprive the State of about €600m in tax revenue, according to reports.
The €600m figure is made up of 25pc of the project’s likely cost overrun of €2.4bn, much of which was incurred due to various delays and changes that occurred during the project’s lifetime, the Irish Times reports.
If the extra €2.4bn had not been spent on development costs it would have been subject to tax, which for development companies is levied at 25pc.
However as with all companies Sell Exploration and Production Ireland can write off capital development costs against taxation.
The Corrib development is Ireland's largest ever energy investment and more than 6,000 people will have worked on bringing Corrib gas to market with the project maintaining 1,250 full-time jobs in Mayo, Donegal and Dublin since 2004.
Gas was originally expected to flow from the field in 2003. However, the project is now more than a decade behind schedule after facing considerable resistance from many in the local community and those concerned about the potential environmental impact of the pipeline.
Gas is expected to finally flow later this year as the total cost of the project is set to top €3.6bn.