North/South Gas Pipeline

Oral Answers to Questions — Enterprise, Trade and Investment – in the Northern Ireland Assembly at 2:45 pm on 26th February 2001.

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Photo of Seamus Close Seamus Close Alliance 2:45 pm, 26th February 2001

8. asked the Minister of Enterprise, Trade and Investment to outline proposals to build a North/South natural gas pipeline.

(AQO 905/00)

Photo of Reg Empey Reg Empey UUP

The position regarding a South/North natural gas pipeline remains as stated in my reply to question AQO 473/00. I have recently received an initial proposal for a South/North pipeline flowing from the Republic to Northern Ireland which is currently being assessed by my Department and the gas regulator.

Photo of Seamus Close Seamus Close Alliance

I thank the Minister for his reply, but does he not agree that it would have been more in Northern Ireland’s interest to have this pipe and the commencement of the work running North/South rather than the reverse?

Photo of Reg Empey Reg Empey UUP

I am inclined to agree. However, one has to understand that the gas industry in Northern Ireland is privatised, and the function of my Department is to regulate along with the gas regulator. We can only react and give licences if a specific proposal is put to us. So far, Bord Gais in the Republic has put forward a proposal, which we are currently evaluating. It is the only proposal that has formally been put before us, and we will have to deal with that as best we can.

The Republic’s decision about where it is going to get its new gas supplies has been delayed on a number of occasions in the last six weeks, and that has slowed things down. There is also the question of the levy and various other matters. All I can say is that a firm proposal which has been put to us is currently being evaluated, and the hon Member knows only too well that we are very keen to see a positive resolution with regard to both North/South and north-west.

Photo of Eddie McGrady Eddie McGrady Social Democratic and Labour Party

In view of the Minister’s remarks to Mr Close, can he indicate what progress has been made in negotiations between the director general of the Office for the Regulation of Electricity and Gas (OFREG) and Premier Transmissions on the granting of a gas licence for the south-eastern region of Northern Ireland? What steps will the Department take to encourage potential developers to expand this much needed energy into other areas of the distribution networks? Are there any applications or negotiations ongoing to provide natural gas to the south-east of Northern Ireland?

Photo of Reg Empey Reg Empey UUP

The answer to the last part of the Member’s question is "Yes". Regarding the negotiations, I personally have had two meetings with representatives of Bord Gais in the last six weeks. Discussions are ongoing. So far as Premier Transmissions is concerned, I have no proposal from that company before me at present. The only one we have is from Bord Gais, and we can only deal with the proposal that we have.

Of course, I have met Premier and other private companies on a number of occasions, and it is no secret that I personally — and it is the Department’s preferential choice — would prefer a North/South pipeline which would supply power stations in the Greater Dublin area and a north-west power station which would supply Coolkeeragh and allow us to feed the towns en route, both south-east and north-west. However, I repeat that we are only able to deal with an application if it is in front of us, and only one is currently being evaluated.

Photo of Edwin Poots Edwin Poots DUP

Does the Minister believe that it is feasible to have both a north-west pipeline and a pipeline that goes to the south-east with a North/South interconnector? If he does not believe that that is feasible, what is his preference? With regard to the value to the economy and the numbers of people using it, the south-east pipeline would be perceived by people living in that area as being of equal or greater value than that of the north-west pipeline.

Photo of Reg Empey Reg Empey UUP 3:00 pm, 26th February 2001

A meaningful energy market and a competitive gas market are both necessary. I want to see an integrated market because one power station consumes 20 times more gas than all the domestic consumption en route to it. Without the base load, the economics of any pipeline are severely restricted. To use an analogy, it is like having a shopping centre with no anchor tenant.

There is a scheme available. However, no formal application has been made to provide a north-west pipeline to feed Coolkeeragh, which would allow the towns en route to access natural gas. Similarly, the departmental view is that a North/South pipeline should run from Northern Ireland to the Republic of Ireland to feed new power station developments in the Greater Dublin area, thereby having base loads at each end of the two pipes.

That would also create a unified network across the island because the Corrib gas field, which is to come on-stream, would be able to sell into Northern Ireland’s market and we would be able to sell into the Republic of Ireland’s. There would then be two pipelines — one to Ballylumford from Scotland, and the existing one from Scotland to the Republic of Ireland. That is the ideal solution, but the Department of Enterprise, Trade and Investment is not in control of matters because it is up to the private companies to make their applications. The Department can only respond on receipt of those applications.