Barryroe oil field could start production ‘within 2-3 years’

Oil production at the one-billion-barrel Barryroe oil field off the Cork coast could commence within the next “two to three years” according to Tony O’Reilly, chief executive of the field’s owners Providence Resources.

Mr O’Reilly told the Irish Examiner that the exact time-frame for the field to enter production will depend on which major oil player Providence Resources chooses to enter into partnership with to develop the Barryroe field. Oil companies from the US, Asia and North Sea have all been in contact with Providence to discuss the prospect of partnering with the Irish company to develop Ireland’s first commercial oil field.

The next phase in setting up a partnership agreement will come when the company publishes its oil recovery factor data in October and the opening of a data room for prospective partners to fully access all available information on the Barryroe field. Following this phase it is expected Providence will enter into a partnership with a major oil company to bring Barryroe to production. Mr O’Reilly said the most likely oil production method will be the employment of shuttle tankers from a fixed platform; with gas from the field being piped to link with the existing gas pipeline attached to the Kinsale gas field.

Providence Resources is set to become debt-free following the sale of its onshore UK licence interests to IGas Energy for $66m (€51.3m). Mr O’Reilly said the sale will also have the knock-on impact of freeing up valuable management time to focus on its Irish off-shore prospects, including Dunquin, where drilling is set to commence in the first quarter of next year.

Providence also reported a loss before tax of €29.7m in the six months to the end of June, compared with a €9.8m loss a year ago because of mechanical issues at a well at Singleton in June.

The company said the sale of the interests in two licences in West Sussex will enable it to become debt-free and concentrate on Barryroe, Ireland’s biggest ever oil strike.

“We’re not selling because we had a bad afternoon, we’re selling because it was the right price and it made sense in the context of what we’re doing offshore Ireland,” Mr O’Reilly told Reuters.

Davy analyst Caren Crowley said: “The divestment of Singleton is strategically sensible.”