Member Info for Manyana

Not only is it mentioned in the Examiner but Tony got his picture in there as well giving the impression he was part of the launch.

A bit more good publicity for Providence, methinks.

https://www.irishexaminer.com/breakingnews/business/irish-oil-gas-survey-many-oil-firms-struggling-to-develop-irish-assets-883430.html

Didn't do too much for the share price today, though.

Indo reports that PwC mentions Barryroe in their report on Irish oil and gas over next two years.

https://www.independent.ie/business/irish/oil-and-gas-set-for-500m-cash-boost-as-prices-on-up-37495892.html

Might give a boost to the share price.

I am not sure, Bronxville, if you are looking at the right place.

In my opinion APEC is probably a front for CNOOC and the real player here is COSL who will do the actual work in Barryroe and are "owned" by CNOOC who have a majority stake in them.

The Wiki entry for COSL says "China Oilfield Services (COSL) is an oilfield service. It is a majority owned subsidiary of Chinese state owned company CNOOC Group.[1] It also has a listed sister company in Hong Kong, CNOOC Limited."

Look who owns them, CNOOC. Now do you think APEC's CEO or Chairman are going to try and rip off CNOOC. Doing that will find them in some flea bitten prison on the banks of the Yanktze.

Check out COSL's Norway website at http://www.cosl.no/ or go to their Chinese website at http://www.cosl.com.cn/ and translate it.

That should give you the confidence to know that APEC are not just chancers. If they were, I would not like to be in their shoes.

Bronxville,

Can I make another point as to why the APEC deal is essential.

Barryroe is a SEL (Standard Exploration License) and not a FEL (Frontier Exploration License).

If you have a SEL license you have about six years in two phases of three years to develop it or you have to relinquish it. On the other hand, a FEL lasts for about 12 years divided into 4 phases of three years. These rules are there to stop oil companies sitting on potential assets, a bit like builders buying land and sitting on it without developing it.

Providence has been given two extensions to Phase 1 of the development of Barryroe with the last one terminating in 2019. If it has not starting development by then Providence should give it back unless the Minister of Communications gives further extensions which he has done on two previous occasions in 2015 and in 2017 during both of which, without the extensions, Barryroe was actually worthless.

Now, believe me, I realise that O'Reilly has made some major mistakes with Barryroe. For example, he raised $100m in 2012 by selling 13.1 million shares on the basis that he would use the funds to develop Barryroe. Instead of doing that he paid off Providence's debts and squandered the rest on things like fighting Transocean and drilling Dunquin North.

There were only 60m shares when he raised that money in 2012. If he had sold say 25m shares rather than 13.1 million then and raised $200m he could easily have developed Barryroe and we would all now be living on pumped oil and gas.

But two subsequent issues of shares at 25p and 12p to keep the company afloat as the company staggered towards a collapse has now raised the number of shares to 600m so you see what a major mistake he made back then.

But at least the company has survived, now has no debt and has a good portfolio of assets so the APEC deal, for those of us long in the tooth, is at least a blessing in disguise because we at least have something other than useless share certificates to hang on our walls.

I have bought Providence consistently over the years as they have fallen and I now have a break even of about 19p with many bought down in the single figures so if they break any where above that, which I expect them to do, I will be quids in but I do know there are many people out there suffering who bought shares at prices up to £5 and more who must be hoping like mad that the APEC deal gets them back at least some of their money.

So APEC might not be the best deal we could have had but at least it will save Barryroe's bacon which is better than nothing.

A few pointers re the oil spill in Bohai in 2011.

Has there been another one since and ConocoPhillips - although not confirmed claimed it was for 1,500 barrels of oil.

Compare that to a few others:

The Torey Canyon spill in Alaska in 1967 was a spill of about 1 million barrels.

The BP Deepwater in the Gulf of Mexico was about 4.5 million barrels.

The Milford Haven 1996 disaster when the Sea Empress was grounded spewed about half a million barrels of oil into the sea. And it is only about 80 miles from Ireland.

So the ConocoPhillips one was small potatoes by comparison.

Furthermore, because of those oil spillages, the Irish government introduced strict rules in 2015 relating to oil exploration to mitigate anything like that happening around Ireland. That is why Exola is taking control of the Barryroe development to make sure the rules are complied with as Providence during the Druid/Drombeg drilling last year.

Abortive as Druid/Drombeg was, it at least showed that Providence could handle the logistics of the development by working through the complex rules needed for a legal and successful drill.

Bronxville,

What would you suggest Providence would do if it did not have the deal with APEC?

For six years they have been trying to get a partner to develop Barryroe and during the TransOcean fiasco it is clear that the vultures were hoping Providence would go bust so they could pick up the pieces on the cheap.

APEC is certainly not the deal I would have liked Providence to sign into but it is a deal and for sure "a bird in the hand is worth more,,,etc" Providence has been looking in a forest for that bird over the last six years. At least it has found one which hopefully it is going to pluck rather than the other way round.

Perhaps you would prefer the abortive Sequa deal? Have you ever looked at the mess Sequa have been in over the last number of years starting with the abortive equity raise to fund the development which failed abysmally. If that deal had gone through you could kick any potential development of Barryroe into the very,very long grass if it could even have been done.

Minister at Conference says Ireland will need oil and gas for the foreseeable future so bill proposed last year to prevent all exploration for oil and gas was bad for the long term benefit of the country as it would create total uncertainty of supply.

Even the reverend Tony gets a mention in the following article about the bill being dead in the water.

https://www.irishexaminer.com/breakingnews/business/state-commits-to-offshore-oil-drilling-882196.html

Interesting statement from minister: “The Government recognises that the realisation of Ireland’s offshore oil and gas resource potential can deliver significant benefits to the people of Ireland, in terms of security of supply, import substitution, and fiscal return,” Mr Canney said.

I have found very little relating to Prof. Xiaozhou Wu but his role as Chief of Expert of the China Bohai Bay Development Committee is important.

Bohai Bay is a major development between ConocoPhillips and CNOOC and if he has had a part to play in that which is a huge development he must be quite influential.

Putting his name in I came across a technical article regarding a Chinese oil development that has some interesting overlaps with Providence. It deals with hydrocarbon-generation depressions which are indicative of oil. You will note these are the very same depressions that Providence says are evident in Newgrange where pockmarks are an indication of methane seepage.

https://link.springer.com/article/10.1007/s13131-015-0784-7

If this man has been as successful in finding 40 oil sources in China it is probably his ability to analyse the geology that has led to the potential locations of the two extra wells in Barryroe and hopefully the other five as well. After all, John O'Sullivan, our guru has yet not found a single oil source as Barryroe was discovered long before he joined Providence.

The whole Chinese oil industry is incestuous with interweaving. In that context I am sure APEC is connected to both CNPC and CNOOC, two main oil controlling interests in China.

Read first APEC's profile.

http://www.apecenergy.com/about.html

Then look at their management team

http://www.apecenergy.com/management-team.html

Of real interest in the management team is the chief geologist whose resume is as follows:

Prof. Xiaozhou Wu – Chief Geologist – Prof Wu worked for China National Petroleum Corporation (CNPC) for more than 40 years as a senior Geologist, who successfully studied and explored more than 40 projects in China. Prior to joining APEC, Prof Wu was the first Chief of Expert of the China Bohai Bay Development Committee.

You will note he worked for China National Petroleum Corporation (CNPC) for 40 years. Now why would he join a mickey mouse company? CNPC is the internal oil controlling company in China whereas CNOOC is the offshore version that owns Nexen, a Canadian company which is now a wholly owned subsidiary that they bought for $15.1billion in 2013.

Then you have COSL and who owns them? read and weep "China Oilfield Services (COSL) is an oilfield service. It is a majority owned subsidiary of Chinese state owned company CNOOC Group.[1] It also has a listed sister company in Hong Kong, CNOOC Limited"

So who owns them, CNOOC of course who owns NEXEN.

Now, why would a CNOOC owned company be involved in Barryroe if CNOOC did not have a big influence on the project and a big say in what APEC can do?

Do you need any further proof that APEC is in bed with Chinese oil at the top level and while you might think it is a "front", there is no such thing in China only fronts to the Government who control everything.

You can be sure APEC will not be fund wanting as the Chinese would never want to be seen to lose face.

Barryroe is the only 2C oil discovery of any real quantity in Irish waters. They have also found lesser amounts in Hook Head and Dunmore but they are of far lesser quantity and not big enough to develop (yet).

Providence has had six years touting Barryroe around potential partners far and wide and finally, after much analysis and discussion and a reasonable oil price, they have a deal with APEC which is written very much in the Chinese favour.

We know that six wells were drilled on Barryroe over the years and all encountered reasonable amounts of hydrocarbons. We also know there is huge gas reserves there. In fact the Kinsale Head gas field which is just about exhausted sits directly on top of Barryroe and probably its gas seeped up from Barryroe because Kinsale is down to 4000ft and Barryroe is directly below Kinsale Head starting from 4000 feet down so the gas probably seeped upwards but a large part still seems to be down there.

Finally, the Chinese are no fools. They would not be in there if they were not pretty sure there was a commercial field and if they were not pretty sure why have they put in the option, as their contribution, to drill the extra two side track wells which O'Reilly today says could also be used for production? Those two wells have been located by the Chinese so how did they do that and why?

All in all, we know there is plenty of oil and gas there. The only question is, how many wells will it need to get it out of the ground and at what cost? Hence, it is not a pig in a poke but a pig sticking its head out of the poke. I reckon about 80% of the pig is sticking out.

Hence my prediction of about 80% assessment that Barryroe is a runner. I cannot cater for the other 20% as there is still a risk but at this point I think that risk is minimal but it is still a risk.

Yes, but why not wait to see if Nexen are successful?

If they are, potential partners will be jumping all over Providence. If Nexen are not successful then Providence would be well advised to leave Newgrange alone as its high risk will just have got higher.

If you look at risk I would estimate the chances of success in Barryroe at 80% and I would put Newgrage at about 20% - O'Reilly says it is high risk. If Nexen comes good you could increase Newgrange to about 60%.

As O'Reilly pointed out at the presentation today, the current rules for drilling off Ireland were changed in 2015 making them far harder to comply with and increasing the costs and the time delays in getting them.

What is the point of doing all that if Nexen comes up wet or empty? Remember that "Some 159 exploration and appraisal wells have been drilled in the Irish offshore since 1970. All told, they’ve only delivered the Kinsale and Corrib gas fields." Those odds do not look too good.

And added to that is the fact that Kinsale Head, which was supposed to deliver gas for years, has now run dry long before its time and will be totally depleted by 2020/2021.

So what happens to Providence if both Barryroe and Newgrange are duds? If Barryroe is a dud there is still some life left in the old dog with the other licenses but if both are duds we can kiss Providence goodbye, in my opinion.

Apologies - my dual post due to glitch in LSE being slow to respond after hitting "post".

I think people are looking at Newgrange wrongly.

Look at the workload for 2019 with the seven wells in Barryroe. If they are successful and the oil is proven - remember we are trying to get to 2P (Proven and Probable reserves) from the current as distinct from the current 2C (Best estimate of contingent resources) - Providence will be a certified oil company.

But until then we are still in limbo - plenty of potential but no proven oil field - still between a rock and a hard place. So why throw Newgrange into that mix? As it says, "high risk/high reward", so why take the risk until Barryroe is proven or disproven .

If Barryroe is proven and it is passed to APEC to develop it means Providence is guaranteed bucket loads of readies over the coming years. If Barryroe comes up dud then it is back to the drawing board and Newgrange, as a speculative opportunity comes back into play.

The problem with Barryroe is that it is a thin oil field covering a huge area of multiple hundreds of square kilometeres so positioning of those wells is critical. Remember Jimmy23's warning that it could be compartmentalised because it is so vast and so thin so one of the worries is that you would need multiple wells to get at the oil which could be expensive. After all, if you drilled one well and it poured 50,000 barrels a day you would be quids in but if you had to drill 50 wells pumping out 1,000 barrels a day each it would be expensive to develop and probably not commercial.

All that needs to be proven next year with the positioning of the seven wells. If they are successful, Providence will be on the pig's back and they can then move on to things like Newgrange and would have the readies to do it on their own rather than bringing in a partner.

So if was planning the next few years I would use 2019 to concentrate on Barryroe and if that is successful would then use some of the potential revenue to develop Newgrange myself in 2020 without hint or hindrance from a third party. At least I would demand better terms on that basis from a third party if I wanted one rather than giving them the lions share of the asset.

And, after all, if Barryroe comes good what are the chances that there will be an offer for Providence? Remember after the flurry in 2012 with the discovery of Barryroe that the Indians wanted to buy Providence and put a price of $1.5billion on it. How much would somebody pay for it if there is 1billion barrels in Barryroe rather than the 360m as is currently anticipated.

Read about the Indian offer at:

https://www.independent.ie/business/irish/providence-1bn-sale-would-have-saved-oreilly-30391508.html

So, after all that, my conclusion is that delaying potential development of Newgrange until 2020 is not such a bad idea.

Perhaps Tony could persuade him to develop Newgrange. He gets a mention in the following article.

https://www.independent.ie/business/farming/agri-business/how-this-kerry-farmers-son-is-a-rising-star-at-oil-giant-bp-37466904.html

Perhaps Tony could persuade him to develop Newgrange. He gets a mention in the following article.

https://www.independent.ie/business/farming/agri-business/how-this-kerry-farmers-son-is-a-rising-star-at-oil-giant-bp-37466904.html

Exola is a subsidiary company of Providence with one asset, Barryroe. It has no kit, staff or operators.

It was set up that way so that Providence could sell off Barryroe by just selling Exola. As such it is just a shell company.

As for the development of Barryroe, all the kit, staff and operators will be supplied by COSL with whom APEC has a strategic relationship. Note: " APEC is a privately owned Chinese company which has a strategic partnership with China Oilfield Services Co., Ltd (“COSL”) and JIC Capital Management Limited (“JIC") for the investment and development of offshore oil and gas opportunities worldwide utilising Chinese drilling units, services and equipment."

Exola will act as developer for the first phases of Barryroe through to the drilling of the five/seven wells. If they are successful, APEC will take over as developer for the rest of the field. This is to ensure the first phase gets done. If APEC had control of the first phase of development a) the Irish government would not give its approval but if oil starts to flow Exola would not be big enough to bring it to full production hence the hand over to APEC.

So a three-cocked hat. Exola (aka Providence initial operator - making the decisions) APEC providing the funding and COSL doing the donkey work for the drilling phase supplying drill ships and drillers while Exola will manage the supply boats and the non-drilling staff through contracts, hence the upfront payment of the $19.5m to cover those costs . Second phase, APEC has the right to take over as operator for the development/production.

Does that make sense?

Olderandwiser, you have my permission to re-post my item from PVR on here if you wish.

I am pretty sure APEC is genuine because approval from both the Irish government and the Chinese had to be given before they could have got to this stage of signing the deal. Both parties would have to be sure the credentials were right before those approvals would have been given and the Irish government would have done their own due diligence on APEC. If they did not they will be castigated from a height in the future, if things go wrong, by the Irish who are still hankering for oil for the natives rather than selling out to the foreigners.

It was bad enough back in 2015 when Providence were supposed to have a deal with Sequa for it only to vanish when Sequa could not raise the bond issue of $300m it wanted to use to develop Barryroe. I am sure Providence have made sure the readies are there this time and APEC is bonafide and has the readies before announcing the deal.

Read the fiasco about Providence and Sequa at:

https://www.independent.ie/business/irish/sequas-300m-fund-raiser-pushes-providence-resources-deal-closer-31209628.html

Hopefully APEC is not another false dawn but the Chinese are mad to get their hands on oil anywhere in the world and you can be sure anything and everything oil wise goes through CNOOC, the Chinese National Offshore Oil Company at some point. Canny lot, those Chinese.

Here's hoping for a Barryroe oily future. But I still say "what about the gas??"

I suspect the reason for this RNS today on Newgrange is linked to the deal between Exxon Mobil and Nexen announced at the weekend.

Remember Exxon Mobil was the major share holder both Dunquin North and Dunquin South with 25.5% equity at the time of the Dunquin North drill. After Dunquin North came up "oil but seeped" they withdrew, not willing to finance the drilling of Dunquin South. When they withdrew in 2016, their equity was redistributed with ENI becoming the operator and Providence's equity rising to 26.486%.

I suspect Exxon Mobil are now sorry they withdrew in 2016 after the results of the 2017 3D survey showed Dunquin South as a potential prospect and are now trying to get back into through Nexen and since the well to be drilled by Nexen next year is close to both Dunquin South and Newgrange it is possible they could try to buy back in and try to combine a drill across all three especially if the Nexen well is successful.

Providence have said that "The Newgrange prospect is a similar Lower Cretaceous carbonate play-type to the previously drilled Dunquin North residual oil accumulation located in FEL 3/04." and while Dunquin North and Dunquin South are geologically similar the difference is that the 2017 3D showed that Dunquin North had a visible escape funnel whereas Dunquin South does not, If that is the case, the chances of oil being in Dunquin South is very high.

So if Newgrange is similar to Dunquin North then Newgrange is also similar to Dunquin South so you have two potential extensive oil reservoirs close to where Nexen are going to drill next year. If all three came up trumps together they would make one massive oil field. But it is only someone like Exxon Mobil who has the credibility and the finances to develop such a prospect.

You can check out the results of the 2017 3D survey of Dunquin North and South at:

http://www.providenceresources.com/sites/default/files/Technical%20Update%20-%20FEL%203-%2004%20DQS%203D%20Seismic%20Update.pdf

I suggest we watch this space as I expect more musical chairs in the next few months especially if Exxon Mobil wants to exercise its muscles and its cash and even more so if Nexen comes up with the goods in its drill next year.

The deal with APEC is not the greatest deal in the world but beggars cannot be choosers.

Providence is a midget oil company with a relatively poor record. Look at the disasters it has had over the last years.

Take the Gulf of Mexico and Singleton, for example. Lost bucket loads of money on both.

Took over Barryroe after five wells were drilled by Phillips and Marathon with oil found in all five and three flowed oil to the surface, two of them at 1,300 and 1,500 barrels a day, but it was deemed noncommercial. Sixth well flowed at about 3,500 barrels a day which is the basis for its commerciality but Providence ended up in a dog fight with TransOcean and ended up paying out money to them.

On the back of the Barryroe find Providence sold 13,148,930 shares to raise $100m in 2012. Where has all of that gone? It was supposed to be used to develop Barryroe.

Then they drilled Dunquin North and found the oil had seeped away. Now Dunquin South is a potential target but who is to say that it is not another damp squib.

Drilled Druid/Drombeg after Schlumberger said their was billions of barrels there only to find it was water. So much for Schlumberger, the great gurus of the oil industry. Have you heard Providence talk about them since?

Only salvation for Providence in Druid/Drombeg was the farm-ins, which I am sure came on the back of the Schlumberger recommendations. If Providence had gone it alone on Druid/Drombeg it would now be defunct as its losses would have been horrendous.

So, left with that litany the APEC deal is a godsend as it gives Providence a last chance to deliver value, hopefully, at minimal cost but all the dice are loaded in APEC's favour.

They are now going to pick five well locations across Barryroe with a further two optional wells. Why five? Why not phase it in one at a time and have they already chosen the locations of the wells or is it going to be pot luck?

And that, hopefully, is where Angus McCoss comes in, I reckon John O'Sullivan has not, in my opinion, the nous to locate them but McCoss does as he has proven in Africa and elsewhere with Tullow. O'Sullivan has shown no real ability to locate oil whereas McCoss has so hopefully he will be used to locate those well sites both for position and for depth.

And that is why, in my opinion, the share price is stagnant because there have been too may false dawns with Providence. If the news on the Barryroe next year starts to prove up even the 360m reserves the price will rise. If they find even more the price will get better but what if they find it is actually compartmentalised as Jimmy used to say and it is actually a number of discrete oil accumulations and that is why they are drilling so many wells. What value then?

And still we hear nothing about the gas which is supposed to be substantial. We do not know if APEC also "owns" 50% of that. Why is the gas and its potential not discussed?

To Wraith,

While your CGT allowance is £11,700, you can actually invest up to £20,000 per annum each into an ISA. Then when you cash out you do not pay any CGT on it. As the government tax says "You pay CGT on" and I quote "shares that are not in an ISA or PEP" so your ISA is CGT free.

So you and your wife could actually invest up to £40,000 and would have no CGT liability.

you can invest in a SIPP as long as you are under 75 and earning a good salary but if you are retired and have no employment income you are limited to investing £2,880 a year which he Government will top up to £3,600.

But if you are still earning a good salary you can invest up to your salary level and the government will add on the 20% which is an excellent investment opportunity.

However, you cannot withdraw from a SIPP until you retire and you must be at least 55 years old and then you are entitled to 25% tax free but the rest will be taxed as income.

For the right person, a SIPP has good benefits and ISAs also have benefits so it is worth comparing them as different people have different requirements. You can, of course, have both.

For myself, I have both a SIPP and a few ISAs but being retired the amount I can put in the SIPP which I set up many years ago is far less than what I can put in an ISA.

I think my information is accurate as I would not like to lead anybody astray but if it is not I am sure somebody will point out where I have gone wrong.

The following is a good comparison between the benefits of a SIPP and an ISA.

https://www.whatinvestment.co.uk/sipps-versus-isas-an-investment-guide-2119168/