Shell Ireland gets fresh €123m cash injection
Shell E&P Ireland Ltd has received a fresh cash injection of €123m as the first flow of commercial gas from the Corrib gas field nears.
New documents lodged with the Companies Office confirm the increase in capital at Shell E&P Ireland Ltd to €1.28bn.
The injection of €123m represents good news for the hundreds of Shell workers in Ireland as approximately €65m of the capital injection is being used to fund what Shell describe as "an important development for the Irish Shell Contributory Pension Fund".
The remaining €58m is part of a projected overall spend of €250m by the Corrib Gas partners in 2015 as gas is finally expected to flow from the field this Summer.
A Shell Ireland spokesman said yesterday that the firm "expects first gas to flow from the Corrib field in mid-2015".
He said: "The 'commencement of operations' phase is ongoing. This involves the testing of all the systems and processes at the terminal to ensure they are ready to operate in a safe and secure manner."
Currently there are approximately 700 people employed on the project and once gas comes ashore, 175 long-term positions will be employed.
The final costs of the Corrib Gas project are set to top €3.6bn in 2015 - more than four times the original estimate of €800m.
The Shell spokesman said that the Corrib development "is Ireland's largest ever energy investment, with over 6,000 different people having worked on the project since 2006. Of the total spend, over €1bn has been spent on more than 300 world-class Irish contractors, sub-contractors and consultancies".
On the €65m pension contribution, the spokesman said that in order to reduce future risks to the Shell Ireland pension fund the trustees (Irish Shell Trust Limited) with the full support of the sponsoring company, Shell E&P Ireland Limited entered into a buy-in annuity agreement with AXA France Vie.
He explained: "The purpose of the "pension buy-in" arrangement is for the insurer to take over the risk of funding pension payments by issuing an annuity policy which guarantees a payment matching the pension fund obligations.
He stressed: "This prudent long-term investment decision has no impact to the payments or benefits that member of the fund will receive. Benefits continue to be payable from the fund."