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Jumping the gun on our oil prospects

AFTER a long absence, oil exploration companies have returned to Irish waters. There is oil in the Atlantic.

Now that experience is growing with the discovery of ultra-deep oil off Brazil and Angola, there is increasing confidence that the oil in the Irish Atlantic too may be commercially exploited -- although the water is colder and choppier.

This is good news. Oil exploitation brings well-paid jobs and welcome royalties. But it is early days. Some commentators have jumped to the conclusion that there is an immense richness under the Irish seabed that is being plundered by foreigners, and have called for punitive taxes.

The fact is, a few comp-anies are exploring for oil. They are losing money at the moment, and it will be 10 years or more before they would see a return on this investment, if any.

There are plenty of other oil provinces that look just as promising as Ireland. Shell's troubles in Mayo are well known in the international oil industry, and the story of Shannon LNG is making the rounds.

Talk of high taxes, even nationalisation, may well scare off the next round of would-be investors in Irish oil. The goose will be slaughtered before it has laid its first egg, perhaps golden.

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