Tuesday, 13 February 1968
Dáil Eireann Debate
I move the amendment to provide that the Minister in granting a licence can do so only if there is a proviso added that the smelter will be such as will cater for all national production of ore concentrates. I want to make it clear that I am not in any way suggesting that the wording of my amendment is completely happy. The whole purpose was to produce an amendment on which to hang the hat of an argument on a matter on which the Minister for Industry and Commerce could not differ from me fundamentally.
First of all, let me make it clear again, as was made clear on the Second Reading, that it is accepted and was acknowledged by the Minister and by everyone in this House, on the Second Reading, that there is to be no restriction on the export of concentrates provided under this Bill and that, indeed, the Minister has gone further, and properly gone further, and made it clear that there will not be any restriction on the exports of concentrates in the future. It is necessary that that be put categorically on the record because one of the ways in which mining in Ireland has been financed has been by those who have smelters putting up the cost because they would be getting the concentrates at the substantial capital involved.
In these days of scarcity of capital, we might find it extremely difficult to get the capital required for mining development, if not impossible, if it had not been provided to a large extent by smelters. That was the method that was adopted for financing in the two base metal mines that are in operation here.
In relation to this smelter for which the Minister asks in this Bill, there is another matter that must be considered. The Minister, first of all, and I suggest  it was a gross breach of the decorum of the House, before he came with a Bill to this House, provided for the granting of a licence: he had already committed himself to giving the licence to any particular group. I will not say. and I must not be interpreted as saying anything whatever against a group, but it seems to me very odd that where there is to be a provision for a sole smelter in Ireland, if such be feasible, where there is to be a provision in which one person, one body of persons, is to have sole monopoly of smelting in Ireland, that commitment was made by the Minister for Industry and Commerce before it became public property that a Bill was to be introduced to permit and to guarantee such a monopoly.
I will be frank in saying that I do not think it was Deputy Colley as Minister for Industry and Commerce who made this commitment himself. I am certain the commitment was made by Deputy Lemass at the time he was Head of the Government, and that Deputy Colley, as Minister for Industry and Commerce, just as Deputy Lynch was before him in that subordinate position in the Cabinet in which Deputy Lemass was Taoiseach, had the power all along. I have no doubt that the provision was there on the Minister's table and that he had to provide for it. I do not think that anyone with any conception of what is involved here could deliberately flout the appropriate parliamentary and governmental procedure in the way this has been done.
Let us see where we are. This Bill provides that when the Bill is enacted, legislative sanction will be given to the promise that was made to give one monopoly the sole right to have a smelter in Ireland, that this right is to be given to that monopoly without any conditions to provide that the smelter will be of such size, capacity and nature as to be able to deal with such mineral discoveries as there may be in Ireland. Many people could understand the anxiety of the Minister to provide a smelter, with all the employment that would go with it, for the purpose of ensuring that all our mineral resources would be fully and adequately developed  as far as possible at home, with consequent work, by-products and side industries at home.
That is what I have suggested in relation to this amendment, that, having, as I say, made the gaffe of making a promise in relation to the granting of the licence—for what reason I do not know and I ask the Minister to give his reason for that promise being made before the legislation saw daylight— there should now be a condition written in that the licence should be such as to make certain that all our capacity could be covered. I can accept that it may not be possible to provide that in the exact wording I have suggested. A smelter could be put up tomorrow for all the known discoveries of base metals in Ireland and another mineral could be found a week after and obviously our legislation could not take account of additional finds. But it does seem to me to be odd, to say the least of it, that no effort should be made by the Minister to ensure that the grantee of this licence would be bound to cater for the whole country, that he should be entitled under his monopoly position to set up for one sector only.
Everyone will accept the view that where a monopoly is granted, it should be for the country as a whole and not for any particular part of it or any particular sector of those operating. It seems to me that if the Minister wished to have this feasibility study—I am quite prepared to congratulate him on considering it—that the approach method was for him, as Minister, to get those who were in the industry in the country together and ask them whether they wanted to go into a consortium. If they did, the consortium would get a licence. If they did not want to go into the consortium, those who did would be accommodated.
We are dealing, of course, with a situation in which, according to the Metal Bulletin of May 1967, we have a prognostication that metal use will soar by 1980, that we will almost double the zinc utilisation, more than double copper consumption, have a 50 per cent increase in lead consumption and no less than a 300 per cent increase over the 1965 level in aluminium consumption.  These are big figures, figures which we hope will mean that the effect of the additional demand will be that even lower grades will have to come into production or will be able to be brought into production for the purpose of meeting this very heavy increase in consumption. To put us in the position in which there will be one smelter alone in Ireland in those circumstances not able to cater for that position, no matter what the shipping transport situation may be to other European smelters, no matter what the political situation may be, is something that I think was very wrong of the Minister.
I do not know whether the Minister's objection to this amendment—and he has been courteous enough to indicate that he cannot accept it—is to the fact of writing it into the statute or that he feels that the position would be met by providing in the conditions attached to the licence that it must be shown in the feasibility report that the smelter will be adequate to cope with all the then known ore developments.
There are coming up, we hope, other mining projects in Ireland. We hope that the stories that there are, for example—I speak entirely from what I have heard as a Deputy and not otherwise—of the mine that has been found by Rio Tinto in Longford will prove correct and that this mine is one that will be developed and become public in the near future, with consequent improvement in our balance of trade position. This is to me a company which, as I understand, has patented a special type of what is known as an imperial smelter which would not merely be able to smelt base metals, but also copper and do some other work also, and yet, that mining company has not been offered an opportunity of going into the consortium in relation to this monopoly project.
I do not understand the way the Minister has approached this. I thought he would agree completely with the views we have expressed on these matters again and again, that where a monopoly position is to be created, it is the duty of the State to ensure that the monopoly is not exercised by one sector alone for the benefit of that sector. That is the purpose of my  amendment. If the Minister's objection is solely to writing it into the statute and he is prepared to give an undertaking here that he will write it in as a mandatory condition to the granting of the licence, I should be perfectly happy to accept his undertaking, but unless there is some such undertaking, I find it difficult to understand how the procedure he is adopting can be justified, repeating, as I do, that everyone on every side of the House is agreed in endeavouring to do all we can to encourage, assist and promote the growth of the smelting industry here at home rather than send concentrates away, provided we can be sure the work will be done for the whole country in the public interest.
Mr. James Tully: Deputy Sweetman and I have been old campaigners over the years and we have crossed swords on many occasions and on other occasions we have been in agreement. On this occasion I am in complete disagreement with his amendment. He is, I am sure, speaking not alone as a Dáil Deputy but also as one who has a personal interest in the business of mining. I am speaking because of the fact that I have been an advocate of the mining industry since I came into public life. I pride myself on the fact that I was responsible for bringing into this country the people now running the largest mine in the country. Let me make it clear that when they came in here they were regarded with disfavour by the people who then held high places. When they came, a Government I supported was in control and Deputy Sweetman was Minister for Finance. I am not saying that he personally took an interest in trying to obstruct these people, but when they came, the word “obstruction” is a mild one to describe what happened when they attempted to get prospecting licences. Again and again problems came up which normally should not come up. However, they came in and they did get their licences, and they spent substantial sums on prospecting in places which did not yield mines or profit. The old mines which they examined had been completely worked out.
When a change of Government took  place, a change in the official attitude did not take place. It was only when they proved beyond yea or nay that not only was there ore in large quantities but that they had discovered it, that the Government, the civil servants—let me say it, for whom the Minister was responsible—were prepared to accept these people and to realise that they had not come in here to fill up sackfuls of gold and depart with them on the next plane. They came in to run a business and to run it successfully. In my opinion, Deputy Sweetman's amendment is an attempt to prevent a smelter being set up here. I may be wronging him, but I am putting it plainly that it would appear that the whole point of the amendment is to prevent the smelter being set up. If we claim to have a smelter which can refine various types of ore which can be found here, it can only be a claim. In fact the situation is that a number of companies are themselves prepared to erect a smelter which will smelt all they are mining at present. If Deputy Sweetman's argument is as strong as he claims, I can see no reason why the companies he is talking about should not apply to the Minister and be given a licence for——
Mr. James Tully: I am quite sure that if Deputy Sweetman's amendment is written into the Bill, it could mean that a smelter erected by one company would be prevented from operating properly because somebody else insisted he had the legal right to have his ore processed in the same smelter. I do not think anybody would agree that this would be the ideal thing. If there was a complete close down on the export of ore when the smelter was erected I could understand it, but the alternative to having the smelter erected at present—and it is going to cost a very substantial sum of money —is that we continue to send the raw ore to the continent and get the smaller amount of profit and the smaller amount of revenue to the State which  is being yielded from the export of raw ore. It appears that there are vast quantities of minerals being discovered from month to month and it also appears that in a few years, if the industry is handled properly, the quantity of ore concentrates which will be available as a result of the mining will amount to so much that balance of payments problems will certainly not be one of our worries. If that is so, I can see no reason at all why the firm which is at present prepared to go ahead with the erection of the smelter should be held up any longer and I recommend that Deputy Sweetman's amendment should not be accepted.
Mr. Sweetman: I want to make one thing crystal clear. Deputy Tully referred to the Government of 1954-57. The late Deputy Norton was in charge of the Department of Industry and Commerce then and I refuse to believe that when Deputy Norton was in charge of that Department he was prepared, in any circumstances, to permit any clog on development by prospecting licences by any group of any consequence. In fact, all the evidence is the reverse. The interest that was shown in our mining potential arose because of the work done by that Government in relation both to the development of prospecting and the development of our tax code which encouraged that prospecting. It would be very wrong of me indeed if I did not say that, to my own knowledge, this was one of the things which Deputy Norton was constantly pressurising to move ahead.
As regards the Bill itself, may I say to Deputy Tully that this is not a Bill for the provision of a smelter? If it were a Bill for the provision of a smelter, there would be an argument. This is a Bill to provide for a feasibility study in relation to a smelter and there is going to be an ex post facto granting of the licence after that. If it were the other thing it would be a very different story indeed. The position is not entirely as Deputy Tully seems to think. Thirdly, is it because the Minister so interprets the phrase in section 2 “by way of trade or for the purpose of gain” that he suggests that a person is entitled, notwithstanding  this Bill, to smelt his own ore? As far as I can see, there is nothing else in the Bill that in any way permits a person to smelt his own ore notwithstanding this. Perhaps it will be a condition excluded by the Minister in the granting of the licence. I cannot see where that arises under the exact wording of the Bill and I should be grateful for some clarification in that respect.
Mr. James Tully: May I hasten to say that I would be the last person in the world to claim that Deputy Norton did not do more than his share as a member of the inter-Party Government, or the Coalition Government, of the time to have mines developed but I still repeat that despite every effort he made and every inducement which he was prepared to offer, the people who were attempting to start a bona fide industry here for mining were prevented again and again. Let me say further that it was only as a result of the direct intervention of the late Deputy Bill Norton that the licence was eventually granted to the people I am referring to to start the work in this country. I cannot repeat often enough that every obstacle was put in their way by people who were in the position to put such obstacles in their way.
As far as the Bill itself is concerned Deputy Sweetman knows quite well that despite what he has said and with which I agree as far as what it contains is concerned, the object of the Bill is the erection of a smelter in this country and the object of his amendment is to prevent such an erection at present.
Mr. Colley: I do not propose to enter into the discussion between Deputy Sweetman and Deputy Tully as to what may or may not have happened in the inter-Party Government but I do want to make it clear, first of all, that this Bill does not set up or provide for a monopoly in regard to a smelter. What it provides is that a smelter to be operated can be operated only under licence. The undertaking which has  been entered into, subject to the passage of this legislation, itself contains the proviso that any mine owner may erect a smelter for the smelting of his own produce, the produce of his own mine, and will get a licence for this. I have said this in the House and I have, I think, communicated this to Deputy Sweetman outside the House but it is not provided for in the Bill because the Bill is not providing a monopoly: it is providing that a smelter to be operated must have a licence. I have made it clear that this is the basis of the Bill and I have made it clear in the House and it is on the records of the House. As to the manner in which that will be operated——
Mr. Sweetman: Of course I appreciated other things the Minister told me. I do not want to go back on them now. Possibly it may have been in the confusion thereby created that this particular point got lost. I think it is a fair way of putting it.
Mr. Colley: I will concede the possibility to the Deputy. The fact is that Deputy Tully says that this amendment is designed to prevent a smelter being erected in Ireland. I would not have been prepared to go quite so far. I would go so far though as to say that the effect of it would be to prevent a smelter being erected in Ireland.
Mr. Colley: I want to make it quite clear that the undertaking, to which Deputy Sweetman referred, to the group carrying out the feasibility study was given by me and not by any predecessor of mine. It was given by me because I was satisfied that if we were to have a smelter in Ireland, a thing on which all of us are agreed as being desirable, this was the only feasible way of providing for it. One could, of course, indulge in a great deal of academic theorising about what should happen in circumstances such as this and one could propose bringing in a Bill that would deal with all these points but you would end up without any smelter in Ireland and my concern is to get a smelter. We had here a proposal from a group who had been very successful in mining operations in this country to examine the possibility of erecting a smelter in Ireland and I think, more than anybody in this House, Deputy Sweetman is aware that there are very considerable difficulties involved in the erection of a smelter in Ireland.
Mr. Colley: Part of the feasibility study which would have to be carried out in relation to it would be the feasibility of raising the necessary finance, which is very considerable. I think Deputy Sweetman would already be aware of the fact that to raise the necessary finance, it would be necessary to be able to show that if a smelter were to be erected in Ireland, it could be carried on on an economic basis. As of now, I do not think there is anybody who would contend that it would be economic to erect more than one smelter in Ireland. It may be that at some time in the future it will be economic to do so. As of now, it would not. Therefore for any group, no matter who they may be, to examine this question and examine the feasibility of financing a project of this nature, it would be necessary for them, in making that examination, to be able to work on the basis that if they were  to erect a smelter, there would not be another smelter erected on the basis of the production available at the moment. This is the reason that the undertaking was given in the terms in which it was given and it was given subject to and on the understanding that legislation on these lines would be passed by this House and by Seanad Éireann.
If I had followed the procedure now recommended by Deputy Sweetman and had withheld such an undertaking until the legislation had been passed, not alone would it have been very difficult to explain and justify to the House the lines that we are following here, which we would have had to follow later anyway in the legislation, without having a definite commitment. Not alone that, but some progress has been made on the feasibility study already even though the legislation has not been passed, and that progress could not have been made if the undertaking had not been given by me. It seems to me very important that if we are to have a smelter in this country, we should have it as quickly as possible.
Deputy Sweetman indicated that he realised there were difficulties of wording in his amendment and he rather suggested that this was a minor matter, and provided the principle was accepted, the wording could be easily dealt with, but I do not think this is so because it seems to me that the principle on which he is going is unworkable. It is not possible to say what the national capacity of production of ore will be within the next 12 months—I am sorry; it may be possible within the next 12 months, but within a reasonably short time. Furthermore, if we were to adopt the principles suggested by Deputy Sweetman in this amendment, it would be impossible for me to have given the undertaking which I have given that any mine owner in this country will be entitled and will get a licence to erect a smelter for the smelting of the production of his own mine. I could not reconcile that with——
Mr. Sweetman: I accept that completely, but I was reading the Second  Reading debate while the Minister was speaking to see whether he said, which I do not think he did, that a person was free to do this. I am perfectly willing to withdraw that if the Minister can quote the reference to me.
Mr. Sweetman: I am not prepared to charge the Minister with having failed to make it clear. All I am saying is that it did not appear to me that he had made it clear and I cannot find anything in the reference that did suggest it.
Mr. Colley: In view of what Deputy Sweetman has said. I ought to say a word about this question of the size of the smelter. I have an undertaking that any smelter to be erected will be capable of producing a minimum of 60,000 tons of metal. Subject to what emerges from the study proposed it is possible that the output would be aimed at 100,000 tons of metal. I understand that this would be at least as big as smelters built elsewhere in recent times with the exception of the smelter at Avonmouth which, I am given to understand, has an output of 140,000 tons. As to the type of smelter on which there was some discussion in the House before, I have no reason to think that any particular type of smelter—and we have heard reference to the imperial type of smelter—would not be considered in the course of the feasibility study.
Mr. Sweetman: Might I make it clear to the Minister that I am not advocating that but that is a smelter, I have heard, that does two types of smelting. That is all. I only use it as indicative of the two-type job.
Mr. Colley: As I say, I have no reason to believe that any particular type of smelter would be excluded from consideration in the feasibility study. I would also point out that under section 3, subsection (2) in regard to the granting of a licence and the conditions to be imposed, those conditions, as envisaged, would include such matters as the minimum size of the smelting operations to be provided for and a time limit within which such operations would be undertaken.
In all these circumstances, having regard to what seems to be the only practicable way to ensure progress in getting a smelter erected in this country, having regard to the fact that we are not taking away the rights of mine owners other than the group to whom we propose to give the licence, it seems to me that what we are doing is in the national interest without doing an injustice to any of the other mine owners concerned and, in all the circumstances, I find myself unable to accept the amendment.
Mr. Dillon: I do not know whether it is on section 7 or section 8 that I should raise a question which has puzzled me a little in the course of the Second Stage and Committee Stage of this Bill. I remember being a member of two Governments and throughout the whole period, so far as I am aware, we were continually urging on the geological section of the Minister's Department to indicate the present position in regard to mineral deposits so that we might arrange for their exploitation. I remember being peculiarly concerned in connection with the Connemara scheme to get the best information I could at that time. What astonishes me now is that people not in the office at all seem to be able to go around the country and pick up stones and find mineral deposits everywhere. How does it come to pass that if these mineral deposits in so readily accessible form were sitting there all the time the geological survey of our own Department of Industry and Commerce never seemed to know of it?
Mr. Dillon: Nobody is more  anxious than me to see the geological section of the Minister's Department vindicated. Perhaps the Minister will say to me that in the last ten years entirely new detection methods which did not exist up to this have been evolved which permit of the detection of minerals, but what puzzles me a little is that it was not our own geological survey that discovered the deposits. I am bringing this in on the ground that a person is liable to heavy penalties for making misleading statements with a view to getting a licence. If there were new methods suddenly discovered, why did not our own geological survey come to the Minister and say to him that all our geological maps so far as mineral deposits are concerned are effectively out of date; that we ought to review the survey with the modern methods so that these deposits can be identified and suitable steps taken for their exploitation for the greatest possible advantage to the community as a whole?
Could the Minister explain that to us because it has occurred to me and I have heard other people ask the question, if these mineral deposits were sitting there, how on earth did our geological survey not know of their existence, seeing that successive Governments were urging on them to make proposals for mineral development and the impression I got generally was that there were no substantial minerals to exploit?
Mr. James Tully: Would it be fair to say that the work of the geological survey over the years as marked on the geological maps has been vindicated rather than otherwise? What has happened is that modern methods of detection are so vastly improved that they have been able to assess the amount of minerals present fairly accurately. There are two places in Monaghan where under the old method they were marked and it was possible to know that there were minerals there. When it was discovered they were completely worked out it was, in fact, found that there was gold in one of them near Castleblayney.
Mr. Dillon: I have been talking  about St. Mary's in my own constituency. I have not been aware of what the Deputy is talking about. I addressed a question to the Minister for Industry and Commerce.
Mr. James Tully: I am not talking to Deputy Dillon at all and I am not talking about St. Mary's. There are two places in Monaghan in which there was lead and I mentioned them because, in fact, a considerable amount of money was spent on them by one of the mining concerns in this country. They were worked out. The present one was discovered because of the marks on the maps prepared by the geological survey.
Mr. Colley: Might I just add a little to that? I agree with what Deputy Tully has said, so far as it goes. What I am about to say is not derived from any expert knowledge available to me as Minister for Industry and Commerce. I have not got information available to me that would enable me to give the explanation Deputy Dillon requires. I am, therefore, about to summarise and add a little to what Deputy Tully says. Some of the important finds were led to by the work already done. I think he also said that technical advances have made it easier to make those developments. In addition to that, it seems to me that mining of its nature is the kind of operation which requires a great deal of risk-taking and that you get people involved in it who have a particular flair for mining. It is not reasonable to expect that you will get such people normally operating within the State service. Furthermore, this is one area which it seems to me is clearly a field for private enterprise and not for State enterprise and the results which have been achieved seem to bear this out. There may be many areas in which State enterprise would be superior but in this case private enterprise is superior.
Mr. Sweetman: In case the Minister might be prosecuted under section 7 for giving false information may I say that I have here before me a Sunday Times article of 12th February, 1967,  Avonmouth smelter as 90,000 tons. The Minister may be right. I am not denying that.
Mr. Sweetman: May I also say that I agree entirely with what the Minister says with regard to people engaged in mining—that they are not the type of people one would find in the Civil Service. I can remember a gentleman who came here 12 years ago—I am not going to mention his name—Mr. Bill R. God forbid that we would have a gentleman like him in the Civil Service.
Mr. Colley: While we are awaiting the next item, might I inform the House in regard to what I said earlier about the undertaking that my undertaking was given in a letter which agreed with the proposal made by the group concerned and that proposal included a saver for a mining company to erect a smelter to smelt its own concentrates. I will make this available in the Seanad but I just thought that Deputy Sweetman and Deputy Tully might like to know this. I have made it clear that the undertaking which I  in which it sets out the capacity of the referred to was given in a letter which was in reply to a proposal received from the group in question and that proposal itself contained a saver to cover the case of a mining company wishing to erect a smelter to smelt the products of its own mine.
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