Committee Reports > List of Committees > Dáil > 1990 > Committee of Public Accounts > Final Report - Appropriation Accounts 1988

APPENDIX 31

Note for information of the Committee of Public Accounts on “MARATHON ROYALTIES”

1. The royalty arrangement with Marathon is a 1959 Agreement, amended in 1982, between the State and the company. The royalty is paid at 12.5 per cent of revenue less agreed deductible costs of producing and transporting the gas to shore (Inch).

2. The level of IR£ royalty which the State will receive in any given year is dependant on three critical factors:

—the volume of gas sold to BGE;

—the prevailing world price of oil;

—the IR£/US dollar exchange rate.

3. Details of total Marathon gas sales to BGE and the corresponding level of royalty received in respect of those sales is attached as an Appendix. The Company is obliged to make detailed audited returns covering royalty payments.

4. Royalties from the recently discovered Ballycotton Gas Field will be payable on the same basis to that existing for the Kinsale Head Field. Before gas production from Ballycotton comes on stream towards the end of 1991 the necessary royalty arrangements specific to Ballycotton will be put in place.

Gas Sales and Royalty Payments in respect of the Kinsale Head Gas Field

DEPARTMENT OF ENERGY.

* The second moiety is due to be received towards the end of the year involving another royalty payment of the order of £2.5 million.