PVR.L Regulatory News (PVR)

19 Sep 2005 07:02

Providence Resources PLC19 September 2005 19 September 2005 Providence Resources P.l.c. •Providence ("Providence" or "the Company")acquires 10% stake in West Lennox Field, offshore Liverpool •Appraisal/Pre-Production Drilling started yesterday •Objective is to increase Providence's daily oil production •Deal also includes 10% of adjacent Crosby exploration prospect Providence is today pleased to announce that, as part of an internationalconsortium, it has acquired a 10% interest in the West Lennox discovery and theadjoining Crosby exploration prospect, both located in proven hydrocarbonproducing areas in the Liverpool Bay area, offshore UK.. The Company can alsoconfirm that appraisal drilling commenced on the West Lennox discoveryyesterday. The West Lennox field is an un-appraised oil discovery located in Block UK110/14c which lies in 15 metres of water off the coast of Liverpool. A discoverywell, which was drilled in 1990, encountered a 25 ft oil column in massivereservoir sandstones of the Lower Triassic Sherwood Sandstone Group. Thesereservoir sands are presently producing 20,000 BOPD at the BHP-Billiton operatedLennox oilfield located just 3km to the east in block UK110/15a. Mappingsuggests that the West Lennox and Lennox oil fields may be in communication,which would provide some considerable volumetric upside to the project.Estimates of recoverable reserves range from a base of 1.6 MMBOE to + 3 MMBOE. The Noble Lynda Bossler jack-up drilling rig (contracted through ADTI) commenceddrilling operations yesterday. Providence's share of the appraisal drilling isbudgeted at approximately €750,000. Following the successful completion of the well a fast-track developmentprogramme involving a single well tieback to the Lennox platform is envisaged asthe most likely plan of development. The partners who include, ChallengerMinerals (North Sea) Limited, P/F Atlantic Petroleum, DYAS UK Limited and FirstOil EXPRO Limited would like to achieve first oil from the West Lennox field atthe end of Q3 2006. In addition to West Lennox, the consortium has also acquired an interest inneighbouring block UK110/14d, which contains the highly prospective Crosby oil/gas prospect (potential recoverable reserves 15 MMBOE). The partners plan toevaluate the most recent 3 D seismic data over this structure as a prelude toany drilling activity. Commenting on the announcement, Mr. Tony O'Reilly Jnr., Chief Executive said: "This is a very attractive investment for Providence. West Lennox represents thefirst step in our stated strategy of increasing daily oil production. At a timeof rising commodity prices, this will allow us to explore other real value addedopportunities already within our portfolio. This new presence in the East IrishSea Basin compliments our other activities in the Irish Sea area, so leveragingour exploration potential." Contacts: Providence Tony O'Reilly Jnr. Chief Executive Tel: +353 1 667 5740 Powerscourt Tel: +44 (0) 207 236 5615Victoria Brough / Sorrel Beynon Murray Consultants Tel: +353 1 498 0300Pauline McAlester www.providenceresources.com NOTES TO EDITORS About West Lennox Licence P.099 comprises the West Lennox oil discovery and the Crosby oil/gasexploration prospect. The licence is located in block 110/14d & 110/14c in theEast Irish Sea Basin, a prolific hydrocarbon province. The partners in the project are: Challenger Minerals (North Sea) Limited - 25%P/F Atlantic Petroleum -25%DYAS UK Limited - 20%First Oil EXPRO Limited - 20%Providence Resources - 10% About Crosby The Crosby prospect is a dip and fault closed exploration prospect located inblock UK110/14d to the east of the Hamilton gas field complex. The structure hasbeen mapped on 3D seismic data and in common with the Hamilton & Lennox fields,the main reservoir objective are sands of the Lower Triassic Sherwood Sandstoneformation. As with a number of discoveries in the area, amplitude anomalies have beenobserved on the top of the structure, which are postulated to be associated withhydrocarbon presence. Mapping to date suggests that the Crosby prospect couldcontain approximately 15 MMBOE REC. The partnership is planning to carry out seismic reprocessing and mapping of theexisting 3D data prior to any future drilling activity on the prospect. As partof the farm-in arrangement, Burlington Resources, the previous licensee holds anoption to back into a 20% interest in the Crosby exploration prospect followingthe drilling of the first well. About Providence Resources Providence's active oil and gas portfolio includes interests in Ireland(offshore), the UK (onshore and offshore) and West Africa (offshore Nigeria). Providence's portfolio is balanced between production, appraisal and explorationassets, as well as being diversified geographically. In addition to drilling onWest Lennox, Providence is involved in drilling the AJE field (offshore Nigeria)and at Singleton (onshore U.K.). Comprehensive information on Providence and its oil and gas portfolio, includingthe AIM Admission document and Annual Report 2004 are all available fromProvidence's website at www.providenceresources.com This information is provided by RNS The company news service from the London Stock Exchange