Monday, March 15, 2010

Frank Fahey sees Shell to the sea shore

Well, we started off with The Atlantic Dawn controvosy where our Frank generously provided temporary licences to this  http://weblog.greenpeace.org/oceandefenders/archive/2006/04/mauritania_ship_from_hell.html until it could swap with its sister ship the Veronica. Next we moved on to the the Lost at Sea saga, where the bold Frank patently favoured his constituents over other deserving causes, much to the annoyance of his department and the then attorney general. This process is now causing a rift between the government parties and the Ombudsman, with good old Danny Boyle sticking his moral oar into the thick of things again.

But, we're not finished yet. This new post is going to focus on yet another example of why Mr. Fahey is not fit for any office. It is my contention that our Frank is in the middle of a rehabilitation process with Brian Cowen. Regularly sent out to bat for NAMA, Frank '40 gaffs' Fahey http://www.businessandfinance.ie/blog_post.jsp?blogID=15&a=2653 is now embroiled in a stand-off between the government parties and the Ombudsman. Why on earth are FF and the Greens preventing the Ombudsman from getting a fair hearing and closing ranks around Fahey, particularly when you consider that Sargent and Fahey have had a hate/hate relationship over the years? Let's ramp up the pressure still further and examine another classic example of how we associate the word 'stroke' with Frank Fahey.

As with all stories, it's important to start at the beginning. The Corrib Gas Field was discovered in 1996, our first commercial gas discovery since the Kinsale Field in 1973. For a resource free country like ourselves, a very important find. The licence for the exploration of the field was granted in 1993, over a period of 11 years. The licence was given to Enterprise Oil and its partners. After the Shell bought out Enterprise Oil in 2002, the breakdown of the consortium is as follows; Shell (operator) (45%), Statoil (36,5%) and Marathon (now Vermilion) (18,5%).

The timing of this is important, because in 1975, Labour minister Justin Keating gave the state a 50% stake plus royalties of 6 to 7% in any commercial find. In 1985, Ray Burke, the corrupt FF minister, abandoned the stake and the royalties. In 1992, Bertie Ahern, the then finance minister, now currently under scrutiny with the Mahon Tribunal, reduced the tax rate applicable to the oil companies by 25% under intense lobbying from the oil companies. Not only that, but the companies were allowed to deduct tax against commercial costs over the previous 25 years.

In fairness to Ahern and Burke, the fact is that we are not a resource rich country, and therefore companies need to be given as many incentives as possible. Notwithstanding that, we have to deal with the facts that the Corrib Gas Field presents us with, and that is its current worth is anywhere between €9.5b and €22b, and our tax take from the profits is the lowest in any equivalent country in the world, money that we desperately require in our current extremis.

So back to 1996, and the consortium are sitting pretty with their multi-billion Euro and practically tax-free find, but with the rather major issue on how they were going to connect their find to the Bord Gáis network on the mainland. In order to connect to the network, the gas needs to be refined first. This can either be done offshore or onshore. Offshore is certainly rather expensive, millions of Euro more expensive than refining onshore.

Lucky for the consortium that they found a willing collaborator in Frank Fahey. As minster of state for the marine and natural resources, he was heavily lobbied by Enterprise Oil executive, John McGoldrick, resulting in the following concessions.

1. He introduced orders allowing acquisition of lands for the gas pipeline.
2. He granted the foreshore license allowing the consortium to land the pipeline.
3. He oversaw the sale of 400 acres of land from Coillte to the consortium to allow the construction of the refinery.

The acquisition of lands: For the first time in the history of this state, Compulsory Acquisition Orders were being used as a direct benefit to a company or conglomerate, rather than the State itself.

The foreshore license: This was granted in 2002 just before the General Election. It enabled the pipeline to be built within 70m of the inhabitants houses.

The Coillte sell-off: Here is Coillte's perspective on land sales:
Coillte owns an estate of 445,421 hectares, which is distributed widely around the country. Coillte's practice is to sell, lease or develop a limited area of non-strategic land, for purposes other than forestry. Most sales are made in response to local demand and typically comprise house sites, isolated dwelling houses, sections of recently acquired farms, small outlying forest properties and gravel pits. [B]Land may also be sold to local authorities for infrastructure projects and for industrial or tourism projects[/B]. Properties sold are those considered not to be of strategic importance to the company's forest business, and properties whose sale would not adversely impact on plans for future management of forests and where value exceeds forest value. A Signing Off Committee within Coillte considers all land sales, with larger sales requiring approval from Coillte's Board of Directors.  

Nothing there to indicate sales to international conglomerates for massive refining projects.
In 2009, An Bord Pleanala objected to the current location of the pipeline as reported in the Irish Times:

Bord Pleanála says that up to half of the proposed nine kilometre onshore route for the Corrib gas pipeline is "unacceptable" on safety grounds, due to proximity to housing in Rossport and Glengad.

The board has suggested that Shell E&P Ireland and its Corrib gas partners explore another route, up the Sruwaddacon estuary, and has given the company three months to come back with detailed information on the route, design and safety of the high pressure pipe.

In a four page letter issued today, the board says that the current application "does not present a complete, transparent and adequate demonstration" that the high pressure pipeline "does not pose an unacceptable risk to the public.

It also says that the impact of construction on a designated rural area in Rossport would "seriously injure residential amenities" and the development potential of lands there. It notes that part of the pipeline route onshore was omitted from the application.

Shell E&P Ireland has until February 5th, 2010 to respond to a series of points raised by the board, which represents a significant setback for the project's time schedule.

All of which results in the delay of the pipeline and the introduction of Corrib Gas into the Irish network. It has also resulted in the cost to the State of millions of Euro in maintaining the Gardaí presence in Bellanaboy, the jailing of local inhabitants (justified or not), and negative headlines all over the world.

The man responsible for all this is Frank Fahey. Mr Fahey could easily have insisted on Shell refining the gas at sea, an option more expensive, but without all the added controversy. Instead Mr Fahey actively went out of his way to aid and assist Shell and its other consortium partners for no discernible reason whatsoever.

Mr Fahey is not interested in local people (not unless they are his constituents of course), he is not interested in the environment (hence Trevor Sargent's previous savaging of him), he is only interested in an obscure patronage that no one can define in any reasonable terminology.

Mikhail Gorbachev -- "What is the difference between a statesman and a politician?... A statesman  does what he believes is best for his country."

This is the land of politicians, and Frank Fahey is at the bottom of them.

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