Nautical Petroleum (LON:NPE) and Providence Resources (LON:PVR, ESM:PZQA) told investors that a new exploration prospect, offshore Ireland, may contain up 74 billion cubic feet of gas.
The Marlin prospect in the North Celtic Sea Basin is hosted on the same license as the Baltimore heavy oil discovery, and it is located just 10km away from key infrastructure at the producing Kinsale Head gas field.
"We are excited about this new exploration prospect as it is in the same geological setting as other proven producing fields in the region and it is very close to the Kinsale Head production facilities,” said Providence’s technical director John O'Sullivan.
The Baltimore oil discovery was made in 1992, and the heavy oil accumulation is estimated to have an ‘in-place’ resource potential of up to 300 million barrels.
In February 2010, Providence was granted a two-year licensing option over the Baltimore discovery and later in April it farmed out a 40% interest in the option to Nautical. Nautical agreed to fund and carry out a focused work programme on the development feasibility of the discovery.
The Marlin prospect was identified through the analysis of seismic data, as part of this programme.
“This is an encouraging first step in the region and we look forward to completing the development feasibility review," Nautical chief executive Steve Jenkins commented.
Furthermore the joint venture partners announced that they have been granted a 16km2 extension to the option to cover the areas of mapped prospects which were outside the previous boundaries.
This morning’s project update was Nautical’s third of a particularly busy week.
Yesterday the company was boosted by a £87.5m divestment, agreeing a deal to sell just over 20% of the Mariner discovery in the North Sea. The company retains a 6% stake in the project.
Perhaps the most significant of the three announcements was Tuesday’s news that the Kraken sidetrack-well in the Central North Sea discovered oil bearing sands in two reservoirs - Hiemdal III and Heimdal Unit I.
The top of the Heimdal III was encountered at depth of 4,417ft and it has a 42ft net oil pay, and the Heimdal Unit
I has a 35ft net oil pay. “The Heimdal I reservoir has significantly higher net to gross and porosity than previously encountered in any Kraken well,” the company said.
“This is a fantastic outcome for Nautical, which justifies our decision to complete the activity on a sole risk basis,” Jenkins said.
“The sidetrack has encountered a substantial oil column, which will result in the reclassification of significant oil volumes from prospective to contingent resources ... those volumes will now be assessed and incorporated into our planning for an enlarged Kraken development."