Irish oil and gas explorer Providence Resources has reached agreement on a deal aimed at starting commercial drilling at its flagship asset, the Barryroe field off the Cork coast.
SHARE The company would not reveal who its partner is, saying the deal is contingent on the partner raising the necessary finance.
Providence also announced it has increased its stake in the Spanish Point field off the west coast by acquiring the Irish arm of UK-based explorer Chrysaor.
"Whilst the project is still at appraisal stage, the recent technical studies have highlighted the upside resource potential at Spanish Point, which, if realised, would confirm the field to be a major hydrocarbon accumulation," Providence chief executive Tony O'Reilly said.
Providence's search for a partner for Barryroe has been a protracted process. Davy analyst Job Langbroek attributed the delay in finding one to a combination of shareholders demanding fiscal discipline in oil companies, a large flow of capital into US fracking, and empty coffers at large State-owned oil firms in China and India.
"It's not stated but I suspect that there would be an expectation that an awful lot of the cost recovery capital involved (in the Barryroe farm-in) would suffice to meet the costs associated with Spanish Point, so it is important that Barryroe is consummated," Mr Langbroek told the Irish Independent.
He said this was important "partly from a delivery point of view, and partly because they'll be the first commercial oil project offshore Ireland.
"If Barryroe is to work it'll work really nicely. It's quite a substantial oil field in a benign fiscal environment, in a safe European first-world context. There's not many of those projects around," he added.
The recent drop in oil prices has seen shares in oil explorers come under a lot of pressure. Shares in Providence were trading at 77c each in Dublin yesterday, down from €2.70 a year ago. Mr Langbroek said the move to acquire Chrysaor and increase the stake in Spanish Point "says an awful lot" about the strain companies have been under.
"There's been a lot of pressure and cost overruns and I guess they couldn't absorb any extra cost, any more delay.
"I don't think it says anything about the quality or otherwise of Spanish Point," he added
Hi Links , it's flaring stronger each day, I got an email photo , this is not just a " relase "of gas.this well is producing at least 4.5 million per day and given the fact that these wells usually take about 2 weeks to clean themselves out naturally suggests that flow rates will be quiet high.Sle will be obliged to give us the correct information as LSE rules apply. although they do not apply DR JB company. I'm not sure why Dr J B and his UAE investors want to play it down .So far they spent 30 mil on this project and will have to spend a further 90 mil on proving up and developing . Who will DR John sell his stake???Who will be our new partners Or are they hoping to secure the rest of our files should SLE not pay 3mil dollars so they can chrystallise the security and buy them . Indeed what a wicked thought. That will not happen, So I hope MR O will ensure his ex eemployee will do what he is told. We required a considerable amount of wells to commence drilling . Sle needs all the Cas flow. Links, on the ground Sle has secured it's future. If the same DRJB had focussed properly when securing a large salary from Sle , he record was lousy. Indeed suddenly how he has improved having cherry picked our assets . Links ignore the posters this a very important commercial well. On each well, during testing I will have my contacts on the ground , so I will know the results. I am not know flow rates but my guys are experiencesd to know if the well is consistent and seems commercial. No one can hide a gas well that's burning extensively over a number of days. OReillys guys are completing the bonds , so it looks very imment. Barryroe for Sle is a worthy asset . Out of all this carnage in the Market SLE wil Pick up a little gem!!!
The flow rate will do the talking...soon. We should know by month end and the result will settle this for you guys.if we get around the 1 mmcfd mark then not mch to celebrate, that will be a bit is of a fail. On the other hand, if we get nearer to 10 mmcfd, then get ready for take off! Basically, nobody knows and no one can do anything about it now...not OF, nor JB (still they should have a pretty good idea by now but until the flow stabilises then it s all a bit of a guess). So now we are just hoping it s gonna flow like never before. If it does, sle will finally re rate. If it doesn t, then...not good. If JB can t make it happen here, then nobody else can. This said, plenty of other prospects. Still this one would get the ball running nicely. Come on JB, surprise us!
There was a temporary small release of gas causing a temporary flare apparently. (see press report).
The report of it by x-rated was rather suspect and the SP today again shows you for what you are linksdean
Just to remind people how exaggerated your report from x-rated was, here it is.
""Poland has been lit up like a Christmas tree, that's what the locals are saying as the well continues to be tested.no one has ever experienced the ferocity of a well which from all appearances suggests !SanLeon Energy and it's partner have indeed been very successful.""
"SLE will have to announce and SLE will be re-rated in the Market . The size of this gas field is enormous . The salt seal must have sealed the gas and should that be the case then about 20 wells will be drilled on this area. 5 million cubic feet of gas per day for each well if possible! Can you imagine what that will do SLE bottom line."
What a joke of a ramp.
Oh well that one didnt work. I wonder what the next great ramping plan is. You at the "drawing board" right now chaps? Could try "Massive oil field accidentally found whilst exploring for gas, probably the biggest in Europe" Jam being delivered tomorrow, by the lorry load. Fill yer boots.
Tell you what would help .... success with the drill bit leading to production. Or more than forlorn hope that some anonymous bidder can raise the cash to farm into Barryroe.
This is the link Promptish was mentioning. Very good website of the town of Rawicz which is even entirely translated in severals languages. They seems indeed very keen on gas production in their area. Worth keeping an eye on as looks like updated frequently.
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