End of Cork’s Marathon gas pipeline link will fuel site sale interest

AN end to a 45-year Irish energy chapter — gas extraction off the south coast — brings a valuable suburban Cork property and site to market with a €3.3m price guide; a literal drop in the ocean compared to the value of the energy supply it has been associated with.

Listed this week with agents Savills is a Mahon/Blackock Cork development site with offices, at the end of an energy company winddown, being sold on behalf of PSE Kinsale Energy, formerly Marathon Oil Ireland and now owned by Malaysian energy giant, Petronas.

Upping sticks: Marathon Kinsale gas rig (file pic)
Upping sticks: Marathon Kinsale gas rig (file pic)

The base for the Marathon Since they initiated natural gas production off the Old Head of Kinsale in 1978, the company’s offices also oversaw activities in gas fields at Ballycotton and Seven Heads as well as the Kinsale Head.

Production ceased in 2020 as supplies were exhausted and there has been a complicated process of decommissioning of rigs and infrastructure since then, rolling on until the third quarter of 2023.

Moves to decommission with various official permissions commenced in 2018, by which time the company said the Kinsale field had produced over two trillion cubic feet of gas — over twice the initial projections back in the late 1970s.

PSE Kinsale Energy Gas rigs
PSE Kinsale Energy Gas rigs

Marathon’s presence was an important boost for the Cork economy, and Ireland’s own indigenous energy supplies: The Kinsale field enabled Ireland to be self-sufficient in gas supply until 1995, being instrumental in the development of the national natural gas network in Ireland with supplies piped ashore to Inch in Cork harbour.

The ex-Marathon/PSE Kinsale Energy offices and brownfield site in Cork’s Mahon suburb, off the Skehard Road, is now described as “a superb development opportunity” by surveyor James O’Donovan of Savills, noting its proximity to the city centre, and to Mahon Point Shopping Centre, Retail Park, and expanding office campuses such as City Gate, where Logitech has recently taken on a 46,000 sq ft new building, with residential development increasingly also a feature on rezoned sites.

Currently the versatile and “unencumbered” site holds a 14,000 sq ft office building and a 17,200 sq ft warehouse, and while zoning at present is in favor of commercial development, residential is also open for consideration, Mr O’Donovan indicates.

“This is a fantastic opportunity to acquire a superb development site on the edge of the city centre.

“Not only does the site offer a significant development opportunity, but the existence of the two-storey office block and adjacent warehouse facility allows purchasers to generate short-term income and offset some of the initial outlay,” he says.

Likely purchaser profile includes developers as well as owner-occupiers both locally and nationally, with short-term uses (and income) ready to go while larger-scale plans might be drafted.

The property is zoned “business and technology” in the City Development Plan 2022 with the primary focus on creating high-technology related office-based industry and enterprise, to facilitate opportunities for employment creation.

However, the vicinity has also continued to mature and transition from early peninsula/east end of city days prior to the transformative arrival of the N41 and Jack Lynch tunnel to embrace Mahon Point and City Gate, Jacobs Island, and residential construction. the latter has come at the former Ursuline Convent grounds off Skehard Road, the completion of Crawford Gate by Bessborough (where medium-/high-density applications are current), as well as a 135-unit scheme at the former Right Price Tiles.

Similarly, planning has been secured for 35 residential units at the former Hormann Electronics site near PSE Kinsale Energy’s base, a presence also dating to 1970s commercial use roots.

Savills is selling now to PSE Kinsale Energy Ltd via private treaty at the €3.3m guide, noting “its location, surrounding amenities and its potential for future growth and expansion”.

Malaysia's landmark Petronas Twin Towers
Malaysia’s landmark Petronas Twin Towers

A statement on behalf of the vendors Petronas/PSE Kinsale Energy Ltd, former operators of the Kinsale Head gas field in the Celtic Sea noted “production from the fields ceased in July 2020, after more than 40 years of operations. The process of safely decommissioning PSE Kinsale Energy’s facilities has been ongoing for a number of years and is expected to be completed in quarter three 2023.

“The company has managed its operations from its office and warehouse facility in Mahon Industrial Estate since 1980 and the premises are now being put up for sale as part of the company’s business wind down activities.”

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Andrew Naughtie

News reporter and author at @websalespromo