Offshore oil exploration to ramp up

IRELAND has upped its efforts to discover offshore oil by yesterday awarding 13 new licensing options.

Minister for Communications, Energy and Natural Resources Pat Rabbitte said yesterday that 13 out of 15 applications had been approved, involving 12 companies.

Ireland’s entire offshore area has only seen 14 exploration wells drilled since 2000, yielding four discoveries

Mr Rabbitte told the Atlantic Ireland 2011 oil conference in Dublin that “Ireland needs to see an increase in exploration activity and exploration drilling in particular, if the petroleum potential of our offshore is to be realised. The positive outcome of the 2011 Atlantic Margin Licensing Round will help bring a new momentum to the level of exploration activity in our offshore. Ireland must continue to communicate the message to international exploration companies that Ireland is open for business and that the Irish offshore has real potential.”

That message certainly reached the stock markets yesterday. One licence award recipient, Petrel Resources, saw its share price jump almost 70% yesterday, reaching €10.75 at various stages after having started the day valued at a little over €6.

Petrel managing director, David Horgan, said: “This is excellent news: the high hydrocarbon prices, fast-developing offshore technology and a proven hydrocarbon system means that Ireland’s opportunity for offshore exploration has finally come.

“There was considerable industry interest in the current round. We are delighted to have been offered two blocks. We have started initial work and look forward to executing this exciting project. There will be discoveries in the Irish offshore.”

Others to receive exploration licences included Repsol, Spain’s largest oil company, and Providence Resources, who were awarded options to explore in four areas off the Irish coast.

Providence chief executive, Tony O’Reilly, said: “Our studies to date indicate a number of structures with significant potential which will greatly augment our already formidable acreage position offshore Ireland.

“Providence now holds licence interests in eight distinct basins offshore Ireland, including our first licence in the Slyne Trough offsetting the Corrib gas field as well as additional acreage adjacent to our Spanish Point gas condensate discovery.

“I am also particularly pleased to welcome Repsol and FirstOil into Ireland as new co-venture partners, as well as continuing our very positive working relationship with Chrysaor and Sosina.”

Mr Rabbitte said that the Government’s view was that the Irish offshore is as yet “very under-explored”.

He said that while even a small number of new commercial discoveries would bring significant benefits in terms of both tax revenue and strengthened energy security of supply, this is unlikely to happen unless we can bring a new momentum to the level of exploration activity.

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