Our close neighbour Norway, with its comparable socio-economic transition from an agricultural to industrialised country, receives a government take that is over three times the Irish rate. This is because it imposes a 78 per cent take rate.
The Norwegian state also participates directly in exploration and production through its 67 per cent share in the major oil company Statoil and its ‘State Direct Financial Interest’ (SDFI).
In 2014, the Norwegian state received around €33.5 billion in revenues from petroleum activities, accounting for 27 percent of the Norwegian government’s total revenues. Revenues from petroleum activities are allocated to the Government Pension Fund Global, which had holdings worth more than €688 billion in 2014.
Unlike Ireland, Norway’s approach to gas and oil management has consistently been underpinned by a view that natural resources belong to all citizens.
In Ireland, successive Fianna Fáil, Fine Gael, and Labour governments did not recognise the potential value of Irish gas and oil, instead focusing on making Ireland as attractive as possible to foreign multinationals.
If companies decide to sell Irish hydrocarbons to Ireland, those resources are sold at full market prices. This means that in addition to receiving one of the lowest rates of government take in the world, the Irish state is not even guaranteed a supply of its own gas or oil. Instead, the state must pay full market prices and compete with others for supply.