The Quest for Irish Oil

Any discussion on oil will involve a number of issues, including financial, environmental and political effects

Given our current financial difficulties, it is important to look at new ways of getting revenue into the country and oil is often seen as a huge money earner. This is for a good reason. The oil industry is worth trillions annually and some estimate that it’s worth nearly a fifth of the global economy.

So what is it? Well,

even scientists are not fully aware of what it actually is. Very little research has been done in this area. This is a little strange given that our modern living is heavily depended on this one mineral. As the Live Science website states; “But with gas prices spiking more than $1 per gallon in the United States this year and some experts predicting that the end of oil is near, scientists still don’t know for sure where oil comes from, how long it took to make, or how much there is.” Rather than oil being created by the compressed remains of dinosaurs, it is formed by tiny creatures known as diatoms. They are single-celled organisms that live on the surface of seas and sometimes lakes. When diatoms die, they sink to the surface and are then compressed and through this process, possibly taking hundreds of thousands of years, oil is born. The fact it isn’t dinosaurs ruined a perfectly good conclusion I had. For shame.

Not much oil has been extracted from Ireland or its shores over the years. There are a number of reasons for this which will be looked a bit in just a bit. Now, we’re all too aware of the recent recession and the effects it has had here and abroad. The purse strings will be tight for the foreseeable future and it is with this in mind the current government are looking to increase revenue streams.

This not pie in the sky stuff. There is evidence to suggest that Ireland can produce enough oil to make exploring and producing it economically viable. A lot of this has to do with geography. At the end of last year Richard Wrigley et al produced a report that said; “The Irish Atlantic Margin Basins share similarities to prolific Atlantic Margin hydrocarbon basins in the UK and Norway where commercial discoveries are being developed.” The report also suggests that the Government are actively trying to get companies to explore Irish territory for oil; “In June 2014 the Minister of Natural Resources announced the Atlantic Margin Licensing Round with an application deadline of 16 September 2015. The large tracts of attractive unexplored open acreage combined with the announcement of the 2015 Atlantic Margin Licensing Round heralds a new era of exploration that may lead to the first commercial discovery.”

This is all sounds like very positive news, but we should proceed with caution in this venture. Barry O’ Halloran wrote an interesting and insightful article about this not too long ago in The Irish Times. He made a number of good points about any future oil production. The Government estimates that there could be as much as 10 billion barrels of oil off our coast, but Mr. O’ Halloran points out that; “Ireland is a high-cost, high-risk destination for the oil industry.” Companies have tried in the past to extract oil from our seabeds and failed. Each time that happens it makes it less likely that new companies will want to follow suit. Failure scares off investment.

Barry O’ Halloran’s article is in the minority. Most articles on the oil situation in Ireland were poorly researched and too full of opinion. Both the pro and anti-oil camps were guilty of this. The worst offender was Irish American writer David Monagan. There were a number of inaccuracies in the article for Forbes. For example; “Providence is run by Tony O’Reilly, Jr., son of the Irish magnate of the same name who was the former CEO of Heinz and builder of the Independent News & Media group, sold in 2010 to the Russian oligarch Alexander Lebedev.” INM was not sold to

Lebedev, The Independent and Independent on Sunday in London were in a sense given to him on condition that he take the company’s debt with him. There are a number of claims that are boarder-line offensive too. He described the Shell protestors as a “small consortium of local protesters and hard-core attention-craving eco-warriors who call themselves “Shell to Sea.”” A number of clichéd and worn out racial stereotypes about Ireland were included too, like; “So deep in the national psyche are the hated memories of British truncheons, Irish authorities struggle to find a proper balance in controlling the smallest crowds run amuck.” Followed by; “But, still, anarchy runs deep in Ireland.” And then; “But this is one country that never seems to be able to get its handle on the weird.” Maybe he thought he was writing for Punch instead. That may have been a bit of a rant, but the point I’m trying to make is this; puerile, ill thought-out articles like this dilute from that actual debate.

As stated before, they were numerous articles like this on both sides. This made it difficult to do proper research on oil. After many hours scrolling through websites, I was reminded of two works of fiction. Firstly was The Thick of It when Malcolm Tucker is trying to disguise a government blunder. He informs his staff to “email them fucking wads of information”  to muddy the waters. The second was the book that is reviewed in this edition, Fahrenheit 451. The fire Chief Beatty explains to Montag how to keep a docile populous; “Cram them full of non-combustible data, chock them so damned full of “facts” they feel stuffed, but absolutely “brilliant” with information.” That’s what the oil discourse resembles. There is one organisation that is trying to make sense of it all though.

Own Our Oil is an organisation that was set up to “highlight the issues around Irish hydrocarbon resource management and inform the public to bring them to demand better stewardship of our natural resources from all political candidates in the coming General Election and beyond.” One of their main concerns is that Ireland will continue to hand over national resources. In the correspondence I had with them they had this to say; “We aim to reverse the terms brought in by Ray Burke and Bertie Ahern, which effectively hand over ownership of irreplaceable Irish natural resources to corporations, getting Ireland nothing in return because of tax loopholes and other issues.”

If we look at the history of oil production, one of the most common themes is bad management. In some cases this has led to tyranny. Given Ireland’s precarious position now within the EU and the fact we have had to hand over a lot of resources –financial and otherwise — and oil’s long and checkered history, it is only natural that groups like OOO have concerns about any future oil drilling in Ireland.
The huge strides in technology in the last two centuries would not have been possible without the cheap and abundant and energy rich mineral that is oil. However, the countries where the oil was

produced have not always seen its benefits and in a lot of cases it has been a curse. In fact, Michael L. Ross wrote a book about oil called The Oil Curse. There are a number of issues that arise from oil production. When it is state run, the ruling élite become very powerful. With vast amounts of cash reserves coming in, the governments can bring in the necessary arms to subdue the people. Ross points to a direct correlation with oil producing countries lacking accountability and thus become less democratic. There are plenty of countries one can point to as an example; Iraq, Saudi Arabia and Nigeria are just a few. Part of the reason for this is these countries don’t have to declare what profits they are turning over so there is no demand from the people for the money to trickle downstream. All political parties depend upon donations and Ross tied this with oil too. “Just like what people eat, governments are shaped by their donations,” he said in an interview. He also claims that the Arab Spring Revolution only really worked in countries that did not produce large quantities of oil, i.e. Egypt and Tunisia.

Oil has had its fair share of pulling between private corporations and state-run organisations. This has also led to conflict. People were aware of the potential of oil production in Iraq from early in the 20th century. In many places around Iraq, the oil just came to the surface without any extensive drilling, this was especially true in Tikrit and Kirkuk. The country was divided up by the ‘7 Sisters’ for oil production. The 7 Sisters were made up of Western oil companies. They comprised of Gulf Oil, Standard Oil of California, Standard Oil of New Jersey, Standard Oil Co. of New York, Texaco– all of the United States– Anglo-Persian Oil Company of Britain and Shell of Britain/Netherlands. They made a tidy profit until Saddam Hussein came to power. He nationalised the Iraqi Petroleum Company in 1972, leading to a stand off and then two wars against the West.

Iran also has a similar history in regards to oil. Mohammed Mosaddegh was the democratically

elected leader of Iran. He wanted to impose a new tax on Anglo-Persian Oil (now BP). The company resisted, so Mosaddegh nationalised all oil production in the nation. The British were unwilling to let this go so they asked the Americans for help. The CIA orchestrated a coup d’état to overthrow Mosaddegh. The Americans then carved up the oil amongst themselves and appointed the Shah to rule the country. The Shah of Iran was a weak ruler and corruption was widespread. The Ayatollah Khomeini was exiled in Paris. He could no longer sit by and called on the Iranian people to revolt. They did so and in 1979 the Shah Pahlavi was overthrown and the oil was nationalised again. To this day, the Americans and Iranians have a deep mistrust of each other.

Even countries that don’t have huge oil reserves affect the oil story. President Nasser of Egypt took back the Suez Canal in 1956. Now fees had to be paid by nations wanting to carry goods through the canal, including oil from the Gulf. The British, French and Israelis invaded and Nasser had concrete laden ships sunk to block up the canal as retaliation. The oil tanker was born out of the necessity to transport oil around the Horn of Africa.
If we are going to start drilling for oil, there is one very good example we could follow. Norway is generally regarded as one of the fairest nations with one of the best welfare systems, which is reliant on oil income. Oil was not discovered in Norway until the

1960s, so the Norwegians learned from the mistakes of others. Oil makes up 22% of the Norwegian GDP. Norway has a lot of hydro-electro dams that produces the country’s energy and the oil is then exported abroad. Dr. Helge Ryggvik is a Norwegian academic that has written extensively on oil there. He wrote that “Norwegian oil policy and Statoil have appeared to be the only successful example of a country which has been able to secure a national direction and control of oil activities and to ensure that the profits were
channelled towards the majority of the population” and “for people standing a little bit outside the oil industry, what predominates is the understanding that Norway has managed to find oil but nevertheless remains an egalitarian welfare state.” Looking at this example, it seems that a state-run company is the best way to benefit the people of the nation.
If we are going start producing oil, Norway is definitely the example to follow, but should we even be bothering in the first place? Why not set up a state-run energy company that deals solely in renewable energy sources? Wind and wave power should be abundant in this country. This would seem a better option because it won’t destroy the environment and the oil market is notoriously volatile. Renewables are safer all around. What happens when oil runs out? Scientists still don’t know how much there is. And now for that ruined conclusion; we could end up as extinct as the dinosaurs we are burning.


One comment

  1. […] So, why mention Ireland and oil in the same breathe? Geography. We are on the edge of a continental shelf and that could prove very important. According to researcher Richard Wrigley; “The Irish Atlantic Margin Basins share similarities to prolific Atlantic Margin hydrocarbon basins in the UK and Norway where commercial discoveries are being developed.” The Government has estimated that there is at least 10 billion barrels of oil off the Irish coast. The potential is definitely there. The problem is, will we just hand it over to large oil companies without seeing some financial advantage? More can be read here. […]

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