Audit raises Barryroe oil potential

Providence Resources believes improved resource figures should further enhance global awareness of its Barryroe oil and gas field, in which it hopes to sell a significant equity stake later this year.

Results published yesterday of an independent audit on the Basal Wealden reservoir — one of four reservoirs at Barryroe — undertaken by oil and gas consultancy, Netherland Sewell & Associates (NSAI), showed recoverable resources of 266m barrels of oil. Added to a previous study of the only other audited reservoir at Barryroe — which is located 50km off the Cork coast and counts as Ireland’s largest oil find to date — the Middle Wealden block, means that the known potential recoverable resources at Barryroe now stand at 346m barrels of oil equivalent, combining oil and significant gas reserves. That is up from Providence’s last estimate of 280m barrels.

The two remaining reservoirs will be audited in the future which could enhance Barryroe’s overall potential.

The company’s technical director, John O’Sullivan, called the new NSAI figures “another very positive step” for Providence, saying the company will now proceed with its farm-out plans to introduce a developmental partner for the field.

Providence currently has 80% control of the field, with Lansdowne Oil & Gas controlling the remaining 20%. The Tony O’Reilly Jr-led exploration company plans to farm-out a significant stake in Barryroe — potentially halving its own stake from 80% to 40% — and aims to conclude a deal with a foreign partner before the end of September.

Mr O’Reilly said that “significant international interest” has already been shown and that the new NSAI survey should “further enhance market awareness” and encourage increased levels of interest.

Although Providence’s share price was up by over 1.3% in earlier trading, it closed the day in Dublin down 0.27% at €7.33.

Lansdowne Oil & Gas chief executive, Steve Boldy, said the encouraging audit results confirmed “the substantial recoverable resources at Barryroe and the scale of the Wealden oil play in the North Celtic Sea Basin.

“This endorses Lansdowne’s view of the overall prospectivity and commercial attractiveness of the basin, in which Lansdowne holds an extensive acreage position,” he added.