Providence to commence drilling for offshore oil

PROVIDENCE Resources is to start drilling in its Blackrock prospect off the Cork coast as soon as the drill arrives from Holland.

Providence believes this is a good prospect with over 600 million barrels of oil in prospect if the conditions are right.

Indo boss Tony O’Reilly became the single biggest shareholder in Providence when he reversed his Atlantic Resources into Conroy Petroleum and Natural Resources.

After the company was split into separate mining and oil businesses, both of them came under O’Reilly’s control, with Arcon set up to handle his mining interests.

At this stage the group has oil and gas interests in Ireland and Britain that it is hoping to explore.

“We are very pleased to report that the Stena Dee drilling rig is currently being mobilised in Rotterdam and is expected to be en route imminently to commence drilling operations on the Blackrock prospect.

We look forward to evaluating the results,” a spokesman said.

During the year Providence farmed out a 50% interest in the Blackrock prospect (Licensing Option 03/1) to two international large scale partners, Challenger Minerals Inc and Palace Exploration Company.

The area has a 30,000 acre hydrocarbon structure with five separate target horizons, estimated to contain 613 million barrels of oil. That potential has prompted the move to early drilling.

Under the farm-in agreement Challenger Minerals Inc and Palace Exploration Company have the right to a 50% interest in the prospect.

In return they will be funding some of the drilling of a test well in 2004. It will also fund 100% of the costs of drilling a second well if they elect to exercise the second well option to earn their interest.

In May Providence raised a total of €13.35 million through new institutional shareholders and a rights issue to existing shareholders.