Providence reports losses of €9.8m

PROVIDENCE Resources has reported a pre-tax loss of €9.83 million and a 4.4% fall in revenues for the first half of this year.

The Dublin-headquartered oil and gas exploration company has also announced the disposal of its near 7% stake in the AJE filed off the coast of Nigeria to Australian exploration company Jacka Resources for $16m.

The near €10m pre-tax loss for the first half corresponds to a profit of €584,000 for the first six months of 2010; but comes as a direct result of once off impairment charge of €4.4m related to unfinished drilling work at Providence’s main British asset, the Singleton field.

The year-on-year fall in revenue — down from €5.98m to €5.72m — relates to production interruptions during the period.

Providence’s balance sheet also shows an operating loss of just under €3.2m for the period.

The Nigerian asset sale, meanwhile, frees up more money for Providence ahead of its ambitious two-year Irish-based drilling round. That work is due to begin in mid-October once Providence gets delivery of the relevant rig equipment.

First drilling will commence at the Barryroe discovery off the Cork coast in the Celtic Sea&.

Speaking yesterday regarding the Barryroe drill, Providence’s chief executive Tony O’Reilly Jnr called the move “a momentous step forward, that should not only unlock the value of this particular asset, but should also trigger a complete industry re-appraisal of the Irish offshore.”