Corrib partner's losses are up 50pc to €30.8m
LOSSES at one of the Corrib gas field partners, Vermilion Energy, increased by more than 50pc last year to €30.8m.
The Canadian-owned firm has an 18.5pc share in the field, and figures just lodged by Vermilion Energy Ireland with the Companies Office show losses increased from €20m to €30.8m last year. The firm has accumulated losses of €203.4m.
A note attached to the accounts states that the nature of oil and gas field exploration is that substantial costs and expenditure are incurred before revenues can be generated from the resources found.
The note says "the directors consider that revenue from the development of the field will be sufficient to make the company profitable in future".
It is 10 years since the Corrib gas project plan was approved by government. However, since then, the proposal has become mired in controversy, including the jailing of the Rossport Five in 2005 and a number of confrontations between gardai and protesters at the site of the Bellanaboy terminal in north Mayo.
Vermilion bought 18.5pc of the Corrib field from Marathon Oil Corporation. Corrib partners are anticipating that gas will finally come ashore in late 2014 to early 2015.
Work was this week suspended on the tunnel to bring the gas ashore following the death of a German construction worker.
The losses last year arose chiefly from €34.25m in bank interest charges, with pre-tax losses last year totalling €40.3m.
An impairment charge of €4.1m also contributed to the pre-tax losses. However, a tax credit of €9.45m reduced the losses to €30.8m.
Shareholder funds at the end of last December stood at €85.27m after a share premium of €255.7m and called-up share capital of €33m are taken into account.
The accounts disclose that Vermilion's capital commitments on the Corrib gas project in 2013 total €65.8m.
The 2012 annual report states: "Vermilion expects to continue to make significant capital investment on this project over the next two years and currently expects to achieve initial gas production from this field in late 2014 to reach peak production levels in mid-2015."
The report says Vermilion bought its interest in the field for an initial $136.8m and paid over an additional $134m to Marathon at the end of last year.