Public vs. private oil & gas exploration

Tommy T

duggie-89 wrote: »

well i cant post a link to any actually bill but i can say is that a large part of the SF party believe in home grown industries and not foreign multi-nationals for long term growth.

ie NOT shell and trying not to rely on the big US computer companies especially in the midlands. if they were to pull out what then?????

how long will this building boom last for and then what???

answer me that????

So who do you recommend, in Ireland, we take on to gain access to the Gas reserves in the Corrib field if not Shell...?

AckwelFoley

Tommy T wrote: »

So who do you recommend, in Ireland, we take on to gain access to the Gas reserves in the Corrib field if not Shell...?

Probably by digging a hole and putting in a hose and syphoning up the gas into tanks.

You dont needs billions of dollars of research and equipment to find resources, build infrastructure and extract it.

Its all a right wing capitalist conspiricy.

Tommy T

snyper wrote: »

Probably by digging a hole and putting in a hose and syphoning up the gas into tanks.

You dont needs billions of dollars of research and equipment to find resources, build infrastructure and extract it.

.

LOL...:D

duggie-89

snyper wrote: »

In a communist system, the government controls the production and distribution of goods.
In the United States, the economy is based on a capitalist model.

but i hate to inform you that russia aint a communist country.

and TommyT personally i think there should be a state run oil company to develop it and return the resources to the people and not to some foregin rich bussiness man. irelands wealth for ireland

AckwelFoley

duggie-89 wrote: »

but i hate to inform you that russia aint a communist country.

and TommyT personally i think there should be a state run oil company to develop it and return the resources to the people and not to some foregin rich bussiness man. irelands wealth for ireland

Thinking is one thing, reality is another.

When anything is undertaken by the state, as a rule it runs into huge over runs, thats not an inditment of our government its a similar story throughout the modern world.

The private sector are the only people that can do things efficently and there is no sector in that line in ireland.

Tommy T

duggie-89 wrote: »

and TommyT personally i think there should be a state run oil company to develop it and return the resources to the people and not to some foregin rich bussiness man.

Have you the first notion how coast oil/gas exploration is? It makes the 20 billion put into the health service look like small change and even then you may come up with nothing.

But then again as a revolutionary socialist youd have no qualms hiking up the income tax levels to pre 1990 days eh..?

murphaph

snyper wrote: »

Thinking is one thing, reality is another.

When anything is undertaken by the state, as a rule it runs into huge over runs, thats not an inditment of our government its a similar story throughout the modern world.

The private sector are the only people that can do things efficently and there is no sector in that line in ireland.

Listen here you. One of the major shareholders in the Corrib Gas Field (a national asset given away by FF, probably for a few quid in a brown envelope-filthy ba$tards) is a state run company called Statoil (you see it in the name now don't you Snyper: Statoil?!). It is Norwegian. It pays for one of the finest healthcare systems in the world (amongst other social services of course).

So, in summation, OUR hydrocarbon reserves (possibly oil) will pay for better social services in NORWAY.

Nevada

Pick Ireland's new Government?

Well that is easy www.irelandfirst.net

murphaph

Tommy T wrote: »

Statoil got luicky because they have an unending oiol supply on their dorstep.

Their oil will run out but I have a feeling they will prepare for that day better than if it were us with the massive resource.

Tommy T wrote: »

Can you begin to imagine an Irish State oil exploration company going out looking to strike it rich?

Bord Gais has been pumping gas from Kinsale for many a year. Why do you believe irish people are inherantly incapable of doing something the Norwegians can do? There's that FF can't do attitude again.

Tommy T wrote: »

The expenses are truly astronimical...

Even if we didn't go all out ourselves (and I accept that it is unlikely for any government to do so) do you really think FF got the best deal for the irish people in their Corrib giveaway? As oil and gas become more scarce, they could have easily said "we wan't half of all the profits or no deal" and eventually some oil company would take the offer, but FF want the fast buck so this fnancial year looks good and screw the future generations (hence the abundance of PPPs!)

Btw, Todd Andrews actually had the balls to make a tough decision. Ahern and his bunc of eternal ditherers could learn a lot from their predecessor.

Tommy T

murphaph wrote: »

Their oil will run out but I have a feeling they will prepare for that day better than if it were us with the massive resource.


Bord Gais has been pumping gas from Kinsale for many a year. Why do you believe irish people are inherantly incapable of doing something the Norwegians can do? There's that FF can't do attitude again.


Even if we didn't go all out ourselves (and I accept that it is unlikely for any government to do so) do you really think FF got the best deal for the irish people in their Corrib giveaway? As oil and gas become more scarce, they could have easily said "we wan't half of all the profits or no deal" and eventually some oil company would take the offer, but FF want the fast buck so this fnancial year looks good and screw the future generations (hence the abundance of PPPs!)

Btw, Todd Andrews actually had the balls to make a tough decision. Ahern and his bunc of eternal ditherers could learn a lot from their predecessor.

i'm not an oil industry expert to judge whether the dela struck was a good one or not.

At least we get a regular and reliable supply of Gas coming into these unsettling future times at market price which is comforting...

murphaph

Tommy T wrote: »

i'm not an oil industry expert to judge whether the dela struck was a good one or not.

At least we get a regular and reliable supply of Gas coming into these unsettling future times at market price which is comforting...

Sorry Tommy. I don't mean to pick on you but your language here belies wjat is wrong with us as a nation. We always settle for the "at least..." solution when we should be asking pertinent questions of our elected (and well paid) representatives.

Aside:
Personally I think it's time the law was changed to be similar to Germany. In Germany there are far more PAYE workers elected to the Bundestag because it is considered a civic duty to represent your constituency and so your job must by law be held open for you for your 4 or 5 years in Berlin. It's like maternity leave. We have a load of auctioneers and publicans running the show because they have the time and resources to spend a few months in the Dail deciding how the majority should live.

To be honest we have not served ourselves well since independence. we could have done so much more. It seems we had more ambition in the early days (ESB and so on). If Bertie was in charge in 1921 we'd still be using candles.

Tommy T

Don't apologise dude. No need. I think securing a reliable and safe supply of Gas supply is imperative for the country...

duggie-89

Tommy T wrote: »

Have you the first notion how coast oil/gas exploration is? It makes the 20 billion put into the health service look like small change and even then you may come up with nothing.

But then again as a revolutionary socialist youd have no qualms hiking up the income tax levels to pre 1990 days eh..?

no i haven't got the figures in my back pocket here maybe you could share some of your figures???

but your missing the whole point of mypost and that was that irelands resources should benifit the irish people.

think of the huge profits those companies have and think about the fact that instead of those profits going into some fat cats account they go into the health service, the police and all the social services. tell me then why would we have to raise taxes??? that seems like the standard fearmongering statement agaisnt people who hold some socialist views

"there gonna raise taxes, there gonna tax your dead dog and ruin the economy"

and i would hardly call meself a revolutionary socialist more of a practical socialist.

guinnessdrinker

Your not alone duggie, the Bertster himself is a self proclaimed socialist.

Tommy T

duggie-89 wrote: »

no i haven't got the figures in my back pocket here maybe you could share some of your figures???

but your missing the whole point of mypost and that was that irelands resources should benifit the irish people.

think of the huge profits those companies have and think about the fact that instead of those profits going into some fat cats account they go into the health service, the police and all the social services. tell me then why would we have to raise taxes??? that seems like the standard fearmongering statement agaisnt people who hold some socialist views

"there gonna raise taxes, there gonna tax your dead dog and ruin the economy"

and i would hardly call meself a revolutionary socialist more of a practical socialist.

We don't have the resources necessary to set up an oil exploration company. We spend enough of our taxes on Services without funding a hugely dangerous venture with no guarantees of success..

duggie-89

IRLConor wrote: »

Aren't state-run companies like that no longer kosher in the EU?

Besides, what the hell do politicians know about oil extraction? The less control they have over stuff they don't understand the better. If you want to get "Ireland's Wealth for Ireland" the answer is to apply taxes appropriately.

well i am not really sure lad but i agree that people who dont understand it shouldn't have anything to do with it but i still believe that the profits should be for the irish state. maybe a kind of semi independant company could be set up where profits go to the irish state.

also its not about what they no its about who should benifit

duggie-89

Tommy T wrote: »

We don't have the resources necessary to set up an oil exploration company. We spend enough of our taxes on Services without funding a hugely dangerous venture with no guarantees of success..

ok then so should we settle for a small cash sum and give away our national rights and the benifits to a company who has no real link to the irish people.

was it right for the old european powers to go til africa and the rest of the world and take their resources for what nothing and if anything was said an army was sent to kill a few hundred of them???

and my view of a state owned company is my idea of a perfect world. but it aint cause you only have to look and se FF in gov so how could it be a perfect world??:D:D

IRLConor

duggie-89 wrote: »

well i am not really sure lad but i agree that people who dont understand it shouldn't have anything to do with it but i still believe that the profits should be for the irish state. maybe a kind of semi independant company could be set up where profits go to the irish state.

Why do you have to tie the actual work of extraction to the value of the resource? It's utterly nonsensical. Just because a private company does the extraction doesn't mean that the state gets nothing.

duggie-89 wrote: »

also its not about what they no its about who should benifit

No matter who exploits the oil resources the Irish state benefits if the state gets its cut by taxing the company or selling the exploitation rights or whatever way they want to go about it.

duggie-89 wrote: »

and i would hardly call meself a revolutionary socialist more of a practical socialist.

"From each according to what he could be arsed to do, to each according to what he can get his grubby mitts on"?

duggie-89

IRLConor wrote: »

Why do you have to tie the actual work of extraction to the value of the resource? It's utterly nonsensical. Just because a private company does the extraction doesn't mean that the state gets nothing.


No matter who exploits the oil resources the Irish state benefits if the state gets its cut by taxing the company or selling the exploitation rights or whatever way they want to go about it.


"From each according to what he could be arsed to do, to each according to what he can get his grubby mitts on"?

it may get something but its like this you would still feel robbed if you sold something for 20k while it was worth 200k so its nothing compared to what it could have. and in the end a state with more money can invest it in to the people.

faith in capitalism is asking the most evil and greedy of mankind to at all times do whats in the best interest of mankind. :D

IRLConor

duggie-89 wrote: »

it may get something but its like this you would still feel robbed if you sold something for 20k while it was worth 200k so its nothing compared to what it could have. and in the end a state with more money can invest it in to the people.

A €200k oil field exploited by the state will not net the state €200k if it exploits it itself.

For a state company you need to subtract:

1. Money to hire and train workers for your state oil company.
2. The cost of their unemployment/retraining when the oil runs out. Some proportion of them will end up unemployed for some time, you have to pay social welfare benefits for them. Some will take state supplied retraining courses which will also cost money.
3. The cost of all of the oil extraction equipment (you can at least recoup some of this at the end of the project).

For a private company it works like this:

1. You've already hired and trained your workers (after all you've been in business for decades). Yes, if you don't have enough spare capacity in your workforce you'll have to hire more but odds are you'll be able to reuse some of your senior experienced people to help out. The amount you need to subtract for hiring is almost certainly less than starting a new company (due to economies of scale) and probably very much less due to the chance of having spare capacity in your workforce.
2. At the end of the project you can re-use as many of your workers as possible on the next project. Any you don't need can be let go. The redundancy package you pay them is the last money you'll need to spend on them.
3. Your equipment has mostly been bought, you only need to spend on maintaining it. Yes, you may have to buy some more to add capacity for the project, but you can resell this just like the state could.

Now, which way the figures will balance is hard to say without knowing the real costs involved. What I do know is that the money lost in the state-run case is mostly just gone, whereas the money you don't get by simply selling the rights does actually get put to use (fat cats gotta eat too you know ). The figures get closest when the private company is operating at 100% of its capacity, but even then the cost after laying off workers at the end of the project is less.

duggie-89 wrote: »

faith in capitalism is asking the most evil and greedy of mankind to at all times do whats in the best interest of mankind. :D

Faith in socialism is asking all of mankind to at all times do what is in the best interest of mankind. Which do you figure will fail first?

(Also, just because I have no faith in socialism doesn't mean that I'm an ardent, crush-the-workers capitalist. There are more options than the two extremes, but that's for another thread I think.)

Elmo

At the end of the project you can re-use as many of your workers as possible on the next project. Any you don't need can be let go. The redundancy package you pay them is the last money you'll need to spend on them.

Or you may just decide to let them go. After all it is cheeper to hire new workers and you don't have to worry about the unions after all you are paying the minimum wage what more should those types expect.

Total socialism and total capitalism does not work.

You need to pick and choose the good aspects of each.

From Socialism
1. Free Education (Capitalist need an educationed work force, and the government needs taxs)
2. Free Health Care (Capitalist need a healthy work force)
3. Social welfare (You need to keep everyone alive, not everyone will earn enought for there family to live on, just like providing grants to companies, social welfare can give those who don't have the access to resourse so that they can.)

From Capitalism
1. Free Trade
2. Competition
3. Money

Your equipment has mostly been bought, you only need to spend on maintaining it. Yes, you may have to buy some more to add capacity for the project, but you can resell this just like the state could.

Most of these projects will be funded by the state from grants and other subsidies so that the foreign investor can be atracted to the country. But this must work for the good of the country and of the company to be considered worth while.

Fine to do this with oil etc but not with the health services.

Faith in socialism is asking all of mankind to at all times do what is in the best interest of mankind. Which do you figure will fail first?

Both get the balance right and you may succeed

IRLConor

Elmo wrote: »

IRLConor wrote:

At the end of the project you can re-use as many of your workers as possible on the next project. Any you don't need can be let go. The redundancy package you pay them is the last money you'll need to spend on them.

Or you may just decide to let them go. After all it is cheeper to hire new workers and you don't have to worry about the unions after all you are paying the minimum wage what more should those types expect.

This has not been my experience. It's really hard to find good staff. It takes ages to get someone up to 100% productivity. As an employer you really have to work to retain good, trained staff. Even when you hire and train smart, experienced people they sometimes turn out not to work well with your current workforce. It's an absolute nightmare.

AFAIK oil workers do not earn minimum wage. They're skilled workers, hence expensive to train and maintain. You don't lay them off and hire fresh ones on a whim.

Elmo wrote: »

Total socialism and total capitalism does not work.

You need to pick and choose the good aspects of each.

+ 1,000,000

Completely agree.

oscarBravo

Split from the "choose your government" thread.

FYI

IRLConor wrote: »

For a state company you need to subtract:

For a private company it works like this:

Conor you haven't described how a state funded company ill compares to it's private counterparts, you've simply compared established company with start up.

IRLConor

FYI wrote: »

Conor you haven't described how a state funded company ill compares to it's private counterparts, you've simply compared established company with start up.

There is at least one major difference: the cost of a laid-off worker. To the private company this is simply the cost of redundancy payments. To the state it's redundancy PLUS the cost of laid-off workers who you have to support between their redundancy and their next job.

Apart from that you're right, but bear in mind that the state does not have an oil company so would have to play the start up game and private industry does not.

FYI

IRLConor wrote: »

There is at least one major difference: the cost of a laid-off worker. To the private company this is simply the cost of redundancy payments. To the state it's redundancy PLUS the cost of laid-off workers who you have to support between their redundancy and their next job.

Apart from that you're right, but bear in mind that the state does not have an oil company so would have to play the start up game and private industry does not.

I'm afraid that doesn't make much sense. The cost of the unemployed is always borne by the state, if a private company lays off workers the state pays, if the state lays off the state pays.

The major obstacle is the fact there is no state owned company, but this is a problem every natural resource exploiting state faced at some point or other. It is a problem we choose to create for ourselves so that we can comfort ourselves that our government isn't completely inept and corrupt.

And of course Statoil have proved, if proof was needed, that a state owned company does not die when the resource at home expires.

IRLConor

FYI wrote: »

I'm afraid that doesn't make much sense. The cost of the unemployed is always borne by the state, if a private company lays off workers the state pays, if the state lays off the state pays.

But the number of unemployed would be greater at the end of the state-run company because there'd be no other project to work on (unless Ireland discovers more oil or gas underneath the seabed in our territorial waters). In the private case there would probably be other work somewhere else which the company would want to retain its skilled workers for.

FYI wrote: »

The major obstacle is the fact there is no state owned company, but this is a problem every natural resource exploiting state faced at some point or other. It is a problem we choose to create for ourselves so that we can comfort ourselves that our government isn't completely inept and corrupt.

Yes but, unless I'm very much mistaken, we don't have enough territorial oil/gas to bootstrap a state oil company to the stage it could compete on an international scale. The Norwegians had both a large supply of oil on their continental shelf and by being fully independent in their ability to give a monopoly to Statoil.

There is also the problem that we'd probably have to put the exploitation contract out to tender anyway due to EU regulations. I'm certainly open to correction on this, but I think it is the type of project which is required to be open to a competitive tender process. So even if we wanted a state-run oil company we mightn't get to do it either.

FYI wrote: »

And of course Statoil have proved, if proof was needed, that a state owned company does not die when the resource at home expires.

It would die unless we could grow it to the size at which it could compete internationally.


I don't understand the obsession with having a state-owned (or worse a state-run) company to do oil/gas extraction. What's wrong with the government hiring a company to do it?

FYI

I don't understand people's obsession with the idea private companies do things better, faster and cheaper than state owned ones.

We still do not know the extent of our natural resources, and as each year passes those reserves grow exponentially in value.

By relinquishing control over those resources we not only give away the potential profits but security over supply. Shell will sell at current market value and utilise existing (state paid for!!! - we managed this much) infrastructure to distribute the supply. Potentially we may not be able to afford to buy our own gas.

State ownership is after all ownership of the people of the state.

You Suck!

As was stated, Irish resources paying for Norwegian health care. I don't care for socialist/capitalist argument, I do care that an existing successful model was ignored and not implemented.

IRLConor

FYI wrote: »

I don't understand people's obsession with the idea private companies do things better, faster and cheaper than state owned ones.

It's not an obsession, it's reality. Private companies in general have to do things better, faster and/or cheaper otherwise they die. State-run companies can be as rubbish as they like because there's no punishment for being crap.

Now state-run organisations have their place. Providing public services like health care, education and public transport are good examples.

FYI wrote: »

We still do not know the extent of our natural resources, and as each year passes those reserves grow exponentially in value.

By that logic we should just sit on the field and do nothing until it's worth more than it is now.

FYI wrote: »

By relinquishing control over those resources we not only give away the potential profits but security over supply. Shell will sell at current market value and utilise existing (state paid for!!! - we managed this much) infrastructure to distribute the supply. Potentially we may not be able to afford to buy our own gas.

Why does the company doing the extraction have to be state-owned or -run? If the field is valued at €200k (to re-use an earlier figure) simply sell the rights to that field for €200k and be done with it. The money goes into our coffers and we don't have to waste money making a state oil/gas company which would be crushed by the supermajors in short order once it moved beyond Ireland.

IRLConor

You Suck! wrote: »

As was stated, Irish resources paying for Norwegian health care.

Not if you do it properly.

You Suck! wrote: »

I don't care for socialist/capitalist argument, I do care that an existing successful model was ignored and not implemented.

The existing model (if you are referring to Statoil) would be much harder to make work here as we have much less in the way of oil/gas resources.