Business Irish

Monday 11 December 2017

Corrib gas field 'will contribute €4.4bn to economy over 20 years'

The gas refinery unit under construction at Bellanaboy in north County Mayo
The gas refinery unit under construction at Bellanaboy in north County Mayo
John Mulligan

John Mulligan

The Corrib gas field will contribute an estimated €4.4bn to Ireland's economy over its 20-year operational lifetime, according to a new report commissioned by Shell.

Michael Crothers, the new managing director of Shell Exploration & Production in Ireland, said the controversial project would require a further €800m investment over the next three years, and confirmed the expected €3bn total cost of the field's development.

When work began on the Corrib project in Mayo early in the last decade, it had been expected to cost a total of €800m.

Shell, Statoil and Canadian firm Vermillion are the main partners on the Corrib field, and are all contributing to the costs. Shell is the operator and has a 45pc stake.

Speaking to the Irish Independent, Mr Crothers said that half the remaining €800m infrastructure investment would be spent in Mayo.

The bulk of that relates to two core pieces of infrastructure -- a 4.9km underground tunnel under Sruwaddacon Bay in north Mayo, and a so-called umbilical line that will link the offshore gas wellheads with an onshore control centre at the virtually completed gas terminal in Bellanaboy. The tunnel won't be finished until 2014.

Terminal

The tunnel is being constructed after An Bord Pleanala ruled that Shell had to re-route a planned pipeline delivering gas from the Corrib field to its terminal.

Gas won't flow from the terminal on to the country's network until late 2014 or early 2015, said Mr Crothers.

The economic report prepared by Goodbody Economic Consultants for the Corrib gas partners, estimates that 1,250 full-time equivalent jobs have been created since 2004 as a result of the work on the field.

It also reckons between the project commencing and the end of Corrib's lifetime it will contribute €6bn to the country's gross domestic product.

The field will have the capacity to initially provide about 60pc of Ireland's peak winter gas requirements. That figure will steadily decline within a few years as gas extraction begins to decline.

Most of the gas produced by Corrib, which is about 60pc the size of the Kinsale field when it was discovered in the 1970s, will be used by Bord Gais.

Other buyers are likely to include independent energy generation firms and large-scale industrial gas users.

Mr Crothers claimed that Shell's relationship with locals in Mayo had improved considerably and that he wasn't surprised at the original level of opposition. "We didn't do a very good job of engagement in the early days," he said.

Irish Independent

Promoted Links

Business Newsletter

Read the leading stories from the world of Business.

Promoted Links

Also in Business