Sequa ‘not expected’ to land Barryroe farm-in

Sequa Petroleum, the Dutch-listed oil finance company previously touted as the frontrunner to farm into Providence Resources’ Barryroe oil field, is not expected to materialise as project partner.

At Providence’s AGM, in Dublin yesterday chief executive Tony O’Reilly Jnr reiterated that four interested parties — comprising integrated oil and gas firms and private equity-backed entities — are in the Barryroe data-room and are all very serious farm-in contenders.

He said while the original frontrunner (Providence has never formally identified the said entity as being Sequa) technically remains in the frame, they are not expected to meet the necessary closing conditions for a deal.

Providence’s senior management also hit back at critics at yesterday’s meeting over the time it has taken to progress Barryroe.

At the occasionally fractious gathering, the company’s board was criticised over failure to conclude a deal on Barryroe, its deflated share price and Mr O’Reilly’s leadership.

One shareholder called for Mr O’Reilly’s removal from the board, accusing him of running the company into the ground, and asking for the board to “very carefully consider the future stewardship of the company”.

Providence’s chairman James McCarthy said the company’s institutional investors who he said have given the company the oxygen to survive, are entirely supportive of not just the company but its management and constantly looked at board performance.

Regarding the length of time it has taken to get a partner for Barryroe, Mr O’Reilly was robust in his response; which listed at least four occasions Providence was on the verge of inking a deal with a prospective development partner, or takeover partner, only for each party to back out for varying reasons.

“We’ve been to the altar many times”, Mr O’Reilly told the floor, before saying management hasn’t been “twiddling our thumbs” for the last few years.

“We’re working our asses off to ensure we get a deal done as quickly as possible. We can’t give a precise timeline, other than to say we’re working as hard as we can to do a deal; but there is real interest. We are very focused on the Barryroe farmout conclusion, it’s our number one priority; nothing else matters,” he said.

“It’s hard to be precise, but we’re very anxious [to get a deal done] as soon as possible; but we’re only one side of the negotiating table,” he said,

Mr O’Reilly said the board remains very positive about its chances of concluding a deal on Barryroe, saying it is a world-class asset, with “much better economics than many European fields”.

While Providence’s management remains quiet over a deal timeframe, one source has hinted it could happen as soon as August or September. Mr O’Reilly suggested a 2020 date for commercial flow from Barryroe would, now be realistic as has been touted by some analysts.

Two shareholders asked if it would be more logical for a third party to bid for Providence as a whole rather than just a stake in Barryroe, given the values of both.

Mr O’Reilly suggested those showing interest in Barryroe want Providence to remain as project partners. However, he did say he “wouldn’t be surprised” if there are other parties sizing Providence up as a takeover target.