Revenue has said that it cannot "rule out" the costs of handling the MV Matthew rising to €20 million.
The Panamanian-registered cargo ship was seized by a joint task force off the coast of Co Wexford for trafficking 2.2 tonnes of cocaine in September 2023.
The Dáil's Public Accounts Committee has heard that the vessel has already cost €12m but this will rise by "several more million".
The Chairman of the Board of the Revenue Commissioner said that the ship is costing €110,000 per week to berth and maintain in Cork harbour, with a crew of 13 permanently onboard.
Niall Cody said he hopes to dispose of the ship in the first half of next year, when a "detailed review" will take place.
"We have never had to dispose of anything like this before," he said.
"There are things that we do a little bit differently."
Mr Cody said there is not a preferred bidder in place, but there is definite interest from a "number of bodies".
However, he said that he cannot guarantee that a sale "will come to fruition".
He said the vessel would "absolutely not" make a profit under the "slight possibility" it is put up for sale.
"It will cost us more to scrap it," Mr Cody said.
He said the regulatory requirements are needed to remove the MV Matthew from Cork Harbour and this will take "at least" a couple of months.
The chairman said the "previous owners" had not properly registered the vessel.
"The vessel has to be kept operating," he said.
"Before we can sell it, we have to have it registered."
Fine Gael TD James Geoghegan asked Mr Cody what lessons had been learned from other countries in similar situations.
In response, Mr Cody said international costs for other vessels would put our "12 million" in the "ha'penny place".
Sinn Féin TD Joanna Byrne said Mr Cody previously said the disposal of the vessel was a "priority".
The ship is now "costing a fortune," she said and that "It seems to be problematic".
Mr Cody said there are concerns that Revenue will be deterred from seizing other vessels "because of the scrutiny".
The seizure of the vessel was "unprecedented," he said.
"If the same thing happens again, we will do exactly the same thing," he said.
He said it is a "very large ship" which was used for smuggling 2,253kg of cocaine into the State.
"It's the highest seizure of cocaine in the history of the country and one of the highest in Europe," he said.
Fianna Fáil TD for Cork South Central Séamus McGrath said tonight that the cost is mounting, and it is very frustrating that there is no clear timeline for the disposal of the ship.
"It became obvious that it will take several more months so the overall cost will go much higher.
"It's possible that the ship will ultimately be scrapped and Revenue confirmed that this well involve a further net cost," he said.
