focusIR May 2024 Investor Webinar: Blue Whale, Kavango, Taseko Mines & CQS Natural Resources. Catch up with the webinar here.
Since the departure of Tony O' Reilly Jnr, the fortunes of Providence Resources have taken a turn for the better. The revival has been led by Pat Plunkett (ex chairman of Tullow Oil) and new CEO Alan Linn. Instead of getting involved spending hundreds of millions of dollars wild-catting in the Atlantic margin, Linn has focused on Providence's discovered Barryroe field only 50 miles offshore Cork, in 100 meters of water. Plunkett and Linn have decided on a low-cost, full farm-out strategy and are currently working on a deal with SpotOn Energy and its Norwegian partners, who have the drilling equipment and funds to fast-track this oilfield and have it in production within three years.
Lynn confirmed that, even before the costs associated with drilling and production went the floor in the current pandemic, Barryroe had a full cost production break-even figure of $25 a barrel of oil and very likely much less than this given the current very low price of jack-up drill rates and drill ships. With an estimated 350 million barrels recoverable, this could leave Barryroe, even at current depressed oil prices, delivering a net profit of five billion dollars.
With the shares down at 8 cent, Providence is capitalised at just 70 million euros and so the shares, as with Tullow, would appear to be significantly undervalued.
Moreover, in this case, there is little or no downside evident, with the Norwegians set to carry the full development cost.
You are right Rocklawn. John O' Sullivan has set up his own company in this regard. You never know, we might see him again.
https://ie.linkedin.com/in/john-o-sullivan-47a568a6
Hopefully there will be carbon coming from Barryroe. As mentioned in the presentation, Providence are assessing the potential for developing Carbon Capture and Storage (CCS) in the North Celtic Sea linked with the Barryroe field, to produce an intergratel sustainable, hydrocarbon development. John Sullivan the previous technical director at Providence, mentioned that the carbon footprint from LNG is up to seven times that from traditional gas fields. The importance of having green credentials is hugely important. Here is a article about carbon capture as relates to the natural gas.
http://www.ccsassociation.org/what-is-ccs/
If Eamon Ryan is to feel the heat from Predator Oil and Gas and their plans to build three floating liquefied gas terminals, Providence Resources must be a cool autumn breeze in comparison, when you take into account their plan to use the Kinsale gas field for carbon capture for any carbon coming from Barryroe
https://www.businesspost.ie/ireland/ryan-to-feel-heat-over-uk-firms-ambitious-fossil-fuel-strategy-23c9a071
Tony Connelly of RTE reporting on the Brexit talks today, mentions the importance of the energy market in the talks. Shows the importance of energy security for Ireland. Here is the relevance section. Link to full article below:
However, at his news conference on Friday the French President Emmanuel Macron told reporters that selling electricity and gas to the EU energy market was worth between €700m and €2.5 billion per year to the UK.
"Barnier has made a very direct link with that," says one official. "If the UK get what they’re looking for in terms of this interconnector market, over €700 million, which ties in quite neatly with the figures we’re talking about on fish. Barnier is saying, we’re essentially giving you that for free, so we want a quid pro quo on fish."
Conflating fish and the energy market could end up being a highly controversial move. Energy flows both ways, and Ireland in particular depends on electricity and gas coming from the continent via the UK. Gas and electricity are also tied in to the complex dynamics of geopolitics and climate change.
https://www.rte.ie/news/analysis-and-comment/2020/1017/1172102-brexit-blog-tony-connelly/
Well that's a 200% rise in three days.
I think buyers always find it difficult to buy shares of a company when the share price has jumped well over 100% in one day. They feel they have missed the boat and wait for some pullback before buying in. This feeling lasts about a week, before buyers begin to accept the new share price, and begin to see value going forward. The problem with Aminex in this situation is that the farmout will announced in a couple of days, and the share price will jump again. Human nature: you cannot beat it.
I see on another board Rocklawn that Davy have put out a note to its investors with a price tag of 19 pence if a deal is put together, which would be great news really, as the every same deal might be announced this week. Davy is happy with the Carbon Capture plan Providence have for Barryroe, which I am guessing they think is something that will pass the Green Party. We are lucky to have the Kinsale gas field so close to use as a carbon sink. The presentation on Thursday will be interesting to see and might give some idea about how things are going.
These shares are going up I think.
No leaks from the board to Major Share holder. Maybe they just didn't know for sure what was going to happen. The word "Delighted" in the RNS really sounded like a word of relief to me.
I suppose they have some time to wait around a little while before accepting an offer, so that would help them somewhat to push it up a bit. Hard to know really, but we will have better sight of things next week.
The Phoenix magazine did a article a number of months ago, bemoaning the progress of Aminex, and said that the best outcome would be for The Al- Zubair corporation to buy them out for ten pence a share, as they already have a very large holding in the company as it is. If the Farmout does not go ahead next week, Aminex will be under pressure, so a offer, if it were to come, would be less than ten pence a share you would imagine. How much less is the question.
I suppose the simple play would be The Al Zubair Corporation to ask the Government not to give the go ahead for the farmout, and then to buy out Aminex.
It would look like signing off on the farm out is a positive for the ruling party when it comes to the election. Aminex,, having set a timeline of a fortnight to sign off on the farm out, have put some pressure on the government to deliver or run the risk of losing some support, as their message of delivering sustained economic growth is undermined by not signing off on projects that deliver that growth.
https://www.thecitizen.co.tz/news/-The-overriding-election-campaign-issues-so-far/1840340-5620200-en2vq6z/index.html
Article in todays Irish Times about The Climate Action (Amendment) bill. The heads of the bill have being cleared by cabinet, so it may be that news about oil and gas exploration, particularly news about the future of Barryroe, may have made its way to some investors in the past week or two. Either way, if Barryroe is given the go ahead, ( which legally it is entitled to under present legislation) the share price will really move north of where it is now. In addition the news coverage of Barryroe finally being developed will give it wings.
https://www.irishtimes.com/news/politics/eamon-ryan-interview-climate-action-is-where-the-jobs-are-going-to-come-1.4364614
We are a little coming to the PVR party, but worth remembering we are a VIP guest, so no rush really. The party cannot begin without us, unless someone wants to buy us out.
With Brexit talks going very badly, and trade talks looking like they are going to collapse, it is time to consider that Ireland gets most of its oil from the North Sea, and apart from Corrib, is at the end of a single pipeline from the UK for its supply of gas. Barryroe is the only project that can replace Corrib and secure Ireland's energy independence. Brexit may be the thing that helps swing public and political opinion in favor of developing Barryroe.
Hopefully he will keep the pen in his hand and sign off on the Animex farmout.
Good to see a rearranging of the board with a great new addition. Chairs rearranged on the deck of the titanic or the board being refreshed to meet the challenges of a company that is going to be a gas producer, maybe even a oil producer.
Hopefully the board have some friends in the renewable energy sector that will speak positively about barryroe and its environmentally friendly plans to extract oil and gas from Barryroe, whilst also taking the time to mention that Providence is not included in the current ban on oil and gas exploration offshore Ireland, and any rowing back on that position sends the wrong signal to all companies wishing to invest in the energy sector in Ireland.