Role of Politicians in Oil and Gas Licenses Under Fire

The relationship of senior politicians to oil and gas executives has come under increased scrutiny as drilling preparation takes place on Dalkey Island.

NewsFour looked at several leading politicians from the late 1980’s until the early 1990’s who played a pivotal role in the drafting of offshore drilling licensing terms. It found drafting terms were usually passed from successive governments over a number of years. In some cases, terms were altered, eroding the rules in place for offshore drilling.

Many of the politicians including Ray Burke, were at the centre of a 2005 report into the Corrib Gas controversary by the Centre for Public Inquiry (CPI). The report cites that Mr. Burke altered terms to include an exemption for oil and gas companies from royalty payments and abolished all state involvement.

According to the CPI report, in one case during the negotiations for new terms for Marathon Oil, Mr. Burke met with oil executives without the attendance of department officials.

“Ireland’s licensing terms were drawn up by Ray Burke in 1987 and further changed by Bertie Ahern in 1992,” says William Hederman Editor of the online advocacy site Irish oil and gas.

Mr. Ahern’s involvement in the successive deals included changes to the Irish tax regime in 1992 when he was the Minister for Finance, and the reduction in corporation tax for oil and gas companies from 50 to 25 percent.

Ceding power

What both Mr. Ahern and Mr. Burke’s decisions led to was a situation where the Irish economy did not reap any significant economic rewards as a result of the changes.

“The oil companies are simply taking advantage of what is an excessively generous deal for them, a bad deal for Ireland. It is the fault of successive Irish governments,” says Mr. Hederman.

The history of Ireland’s relationship with offshore drilling goes back to a deal struck in the 1960’s and has resulted in a number of public outrages.

By: Liam Cahill