Dublin-based exploration firm Fastnet Oil and Gas is open to partaking in merger and acquisition activity, as part of the wave of consolidation expected to materialise in the international oil and gas sector in the next few years.
The company — which is active offshore in Morocco and Ireland, in the Celtic Sea —yesterday announced some significant extensions to its Irish asset portfolio; including the awarding of a new licensing option located in the north Celtic Sea basin.
Yesterday Fastnet chief executive Carol Law said that despite a number of setbacks (the company has relinquished its onshore interests in Morocco and has shelved plans for further asset acquisitions in eastern Africa; while plans to finalise farm-in agreements on its various Celtic Sea assets by the end of 2014 didn’t come to fruition), management remains upbeat on the company’s progress.
Up to nine parties were, reportedly, interested in investing in Fastnet’s Irish and Moroccan assets in the third quarter of last year and management was hopeful of concluding deals by the end of December. A drying up of deal activity and a shrinking oil price has turned the industry on its head since then, but Ms Law said Fastnet has maintained open dialogue with a number of US-based interested parties and is “optimistic” about how that dialogue is progressing.
A significant part of yesterday’s announcement — along with the new option award and the extension of three licences off the south coast — was news that Fastnet’s exclusive option agreement with the Malaysian-owned Kinsale Energy, regarding the highly-rated Deep Kinsale option, has been extended until the end of this year. The prospect, which lies underneath the producing Kinsale Head gas field, has been likened to the nearby Barryroe field as a potential key find in Irish waters.
Fastnet had until the end of this month to decide on whether to drill, but has now got that date extended to December 31; giving it more time to continue farm-in discussions.
Ms Law added that Fastnet will show interest in this year’s Atlantic Margin licensing round — the Government’s first such round for three years — but is likely to keep its main focus on the Celtic Sea region; noting that full operations off the west coast may be a challenge for the company, but a small piece of acreage could be considered.
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