Island Oil & Gas upbeat as its fields near production

ISLAND Oil & Gas currently assessing gas finds off Kinsale and Schull made an operating profit of Stg£904.000 (€1.12m) against a loss last time of £5.39m (€6.7m) for the six months to 31 January, 2008.

The better figures essentially reflect the sale of a 10% interest in the Amstel field in the Netherlands.

Sales from its Seven Heads field fell to £920,000 from £1.18m due to lower production volumes and lower gas prices.

“These interim results demonstrate Island’s ability to add value in tight market conditions”, said chief executive Paul Griffiths.

The group was “highly confident” that with oil and gas prices rising it was well positioned to grow its business from its current exploration portfolio.

In the six month period Island reported that considerable progress has been made in its Celtic Sea acreage where the appraisal well from the Schull field has demonstrated the potential of the gas find, while it and the Old Head of Kinsale field move closer to commercial production.

Island is becoming increasingly diversified. Off the west coat of Ireland in the Atlantic Margin it has identified a second significant project on the Kilalla licence, while in south eastern Europe it has acquired interests in Moldova, and in North Africa it acquired seven exploration permits relating to the Tarfaya Basin in which it holds 40% of the equity.

The diversification into Morocco and south eastern Europe has seen the group broaden its base and spread the risk while offering greater potential to the group, said Mr Griffiths.