The disappointing results from Statoil's test well 100 miles west of Galway, merely joins the long queue of duds around our coast. There will be many others. Nevertheless, a quiet maturity appears to have descended on the industry. The decision of Statoil to reveal details, rather than shroud the findings in a cloak of secrecy, is a healthy move. And the non-emotional greeting to the resumption of drilling by both Marathon and Total - in the Porcupine Basin - and Statoil's decision to test the commerciality of oil from its block in the Connemara Field, is refreshing. Drilling activity will be at a higher level this year. Only two wells were drilled last year, in Slyne Trough, by Enterpise Oil. One had "gas shows". So far the results from drilling off our shores have been pretty dismal. Around 126 wells have been drilled since 1969 and the results have been unproductive except for the commercial Kinsale gas well discovered by Marathon and the subsequent add-on well 16 miles to the north east.

There have been a number of non-commercial gas and oil discoveries. Two of these are being investigated to see if they can be commercial. Another is to be further tested.

One is Statoil's block in the Connemara Oil Field in the Porcupine. Formerly owned by Aran Energy and before that BP/Aran, it has 200 million barrels of oil in place. The recoverable amount might only be of the order of 40 million, which must place it in the marginal category.

Statoil, with special expertise in exploiting deep waters, has begun an appraisal programme. Drilling on one reservoir was abandoned on Friday and drilling on another reservoir has commenced. It expects to have the results by September or October. If it is deemed to be commercial, oil could start flowing in less than a year's time. The other is Arcon (soon to called Providence Resources) in block 49/9 in the Helvick field in the Celtic Sea. Recent studies have indicated recoverable reserves of over 6 million barrels of oil. A feasibility study is to investigate its commerciality, though Arcon, taking an optimistic view, has said it could generate revenue of $115 million. Also the gas shows by Enterprise Oil in the Slyne Trough are being further investigated. Mechanical problems inhibited initial tests. However, further seismic may point to a better location for drilling.

While activity is at a much lower level than the late seventies and early eighties, it appears to be more soundly based. Marathon had a virtual monopoly from 1960 when exploration started, to 1970. The new licensing terms of 1975 opened the field considerably. Local participation was actively encouraged and this spawned numerous Irish explorettes, leading to a surge of enthusiasm, and many speculators losing heavily, until interest faded with the oil price collapse in 1986. The new licensing terms introduced in 1992 are more tailored to reality and, as such, should encourage oil companies to explore in an area which has yet to prove itself. There are no royalty payments and there are generous allowances for offsetting expenditure against profits. The only Government take is in the form of corporation tax which is set at a rate of up to 36 per cent but, in specific circumstances, the net rate of 25 per cent can be applied. Also the licensing terms are designed to encourage production. Only a tiny fraction of Ireland's offshore has been drilled. The Irish designated area consists of some 650,000 square kilometres. This represents an equivalent to more than seven times our land area. While the Porcupine area has the potential to hold large accumulations of hydrocarbons, the Rockall Trough - Ireland shares it with Britain which is further west - is a much larger area. As it is on a trend with the West of Shetland area which has sprouted some very large finds, Rockall enthusiasts argue that this area has more potential than any other area.

It covers some 800 blocks. Under the Rockall Round 11 licences covering 58 full or part blocks were issued.

While this exploration should provide valuable data, any potential from this area is long-term. Of more immediate interest will be the results coming out from next month onwards. A continuation of non-commercial finds will not alter the gait of the Celtic Tiger. However, a commercial oil find, or another commercial gas field, would provide the Celtic Tiger with a swinging tail and a happy purr.