www.providenceresources.com
The combination of board and management talent, together with Providence's major shareholder worldwide network, presents a unique ability to succeed on the international stage. Providence has appropriate experience in the financing of large developments and is well equipped to plan and access finance for a wide range of activities and projects. Providence has established banking relations with a number of leading international financial institutions.
Since its formation, Providence has built a diversified portfolio of oil and gas exploration licences and concessions with the key focus being the pursuit of exploration and appraisal interests offshore Ireland. The Company’s board and management have a well-established background in the oil and gas business having worked closely with many major companies throughout the world. Providence works with leading companies including ExxonMobil, Repsol, ENI, Petronas, Chrysaor and Nautical Petroleum.
Providence Resources unveils encouraging results from its secondary target on Barryroe
Providence Resources (LON:PVR) this morning provided a highly encouraging update on its Barryroe appraisal well in Ireland’s Celtic Sea.
Results from the secondary target reveal that “hydrocarbon shows” were uncovered that potentially contain a number of secondary reservoir units.
Data from 48/24-10z mirrors the findings from four other wells drilled on Barryroe, including the 48/24-3 well.
The current well is in the east part of Barryroe and data from previous wells shows that these secondary logged hydrocarbon-bearing sands thicken to the west.
Collectively, these five wells now span a total distance of 20 kilometres and confirm the presence of “potential incremental light oil resources within this secondary interval”, Providence said.
The primary objective of the drilling, however, is the basal sands, which will be cored and tested to demonstrate commercial flow rates in the order of 1,800 barrels a day.
Well 48/24-10z is at just short of 7,000 feet, which means work will continue for “another few weeks”, according to Providence.
Chief executive Tony O’Reilly said this morning: “The 48/24-10z preliminary well results indicate the presence of hydrocarbons within the secondary objective overlying our main basal sandstone target.
“We will evaluate and integrate these well data with our newly processed 3D seismic in order to fully assess its incremental resource potential.
“Most importantly, operations to evaluate the underlying primary Barryroe reservoir objective have now commenced and we look forward to further updating shareholders once the drilling phase of the programme has been completed.”
Providence is the operator of the block with 80 per cent, and is partnered with Lansdowne Oil & Gas (LON:LOGP), which owns the remainder.
Discovered in the 1970s, Barryroe previously flowed oil at the rate of 1,400-1,600 barrels a day.
A flow rate above 1,800 barrels a day makes Barryroe economic, according to an independent report compiled by RPS, which also estimates there is 60 million barrels of crude recoverable from 373 million barrels in place.
The economics of the field show that this one development prospect could be transformational.
Based on the field’s P50 reserves – those with a 50 per cent chance or better of being recovered - the net present value for Barryroe is just over US$800 million using a 10 per cent discount rate.
It kicks off a frenetic exploration and development programme worth US$500 million, with the London and Dublin-listed Providence footing between US$80 millon and US$120 million of that bill.
The group will move on to two exploration plays – Dalkey Island off the coast of Dublin and Rathlin Island, off the north-eastern corner of Northern Ireland.
After that the emphasis changes from east coast to the west, and Providence is heading very much further offshore in the pursuit of oil and gas.
Spanish Point is a gas condensate discovery located 125 miles offshore. It was found in 1981 when Ireland simply did not need gas in the quantities thought to be contained at Spanish Point and there was no infrastructure by which to exploit it – that has all now changed.
Providence estimates there are 200 million barrels of oil equivalent. It owns a 56 per cent stake, which will fall to 32 per cent when partner Chrysaor formally agrees to drill two wells there.
Those who follow Providence closely will know that Dunquin is the big daddy of all its exploration projects, and it has an all-star roster.
ExxonMobil and ENI each own 27.5 per cent, Repsol has a 25 per cent stake. SOSINA holds 4 per cent, leaving Providence with 16 per cent.
Work is expected to get underway on Dunquin in mid-2012, with drilling next year. Also next year Providence will drill an appraisal well on the Dragon Field, which is equidistant between Wales and Ireland.
It also has a producing asset in Singleton in West Sussex. Oil revenues from this source will be used to help fund the company’s exploration activities.
