The company already owned a 50% stake in the asset — which marks the starting point on its wide-reaching drilling campaign offshore Ireland — but is now acquiring the 30% controlled by rival exploration company, San Leon Energy.
San Leon will receive a 4.5% net profit interest in the licence.
After the transaction is completed — pending Government approval — Providence will have an 80% share of Barryroe and will continue as operator of the licence, while Lansdowne Oil & Gas will hold the remaining 20%.
Providence’s chief executive Tony O’Reilly Jnr said: “This transaction makes perfect strategic sense for both companies, allowing each to focus on their respective core areas. Providence remains firmly focused on its Irish port-folio, with the Barryroe appraisal well being the first well of its multi-year,multi-basin drilling programme.”
Providence issued its end-of-year trading review on Thursday in which Mr O’Reilly said “the time has come” for Ireland’s hydrocarbon potential to be realised.
Touching on the firm’s ambitious drilling plans for Irish waters over the next few years, he mentioned recent appraisal drilling at Barryroe and said the significance of this should not be underestimated.
“The successful demonstration of a commercial flow rate should not only unlock the substantial value of this particular asset, but should also trigger a complete industry re-appraisal of the Irish offshore,” he added.
Full results from appraisal works at Barryroe will be known in the coming weeks. Following Celtic Sea drilling — at both Barryroe and Hook Head — Providence will begin drilling at its Kish Bank Basin asset, off the Dublin coast near Dalkey Island; before moving north to Rathlin Island.