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Corrib gas field costs Shell over €120m

The Independent

Discovered in 1996, the Corrib gas field contains one trillion cubic feet of gas and has an estimated field life of 15 to 20 years. Library image

Saturday January 10 2009

Corrib gas field costs Shell over €120m

By Gordon Deegan

NEW figures for Shell Exploration & ProductionIreland, the company leading the development of the Corrib gas field, show the company had spent over €120m funding its share of the project by the end of 2007.

Efforts to take gas ashore from the field lying 83km off the Co Mayo coast have been dogged by controversy and figures yesterday showed for the first time the scale of Shell’s outlay on the project.

In accounts filed by the Irish subsidiary of Shell to the Companies Office, the firm’s accumulated spend to the end of 2007 was €121m.

The accounts also include €40m in exploration costs written off by Shell since 2004.

The accounts show that the book value of Shell’s 45pc share in the Corrib gas field has almost doubled in three years, up from €230m at the end of 2004 to €422m at the end of 2007. The other partners are Statoil with a 36.5pc share and Marathon with 18.5pc.

The directors caution that the future recovery of the ‘field-under-development fixed asset’ “is dependent upon and will only be realised on the successful completion of the Corrib gas field development”.

Discovered in 1996, the gas field contains one trillion cubic feet of gas and has an estimated field life of 15 to 20 years.

Work is continuing on the scheme’s onshore refinery at Bellanaboy, while Shell is to shortly resubmit a planning application to An Bord Pleanala for an onshore pipeline.

The company expects construction work on the refinery to be completed later this year but the directors warn that “the company faces numerous challenges, including certain technical and regulatory conditions”.

The accounts show that the Shell E & P Ireland has received €416m from its parent to advance the Corrib gas project.

The accumulated losses of €121m can be offset against future profits secured by the company.

– Gordon Deegan

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