Saturday 3 December 2016

Providence in talks with lender after $7m legal hit

Published 14/04/2016 | 02:30

Providence Resources' Barryroe well. Photo: Finbarr O'Rourke.
Providence Resources' Barryroe well. Photo: Finbarr O'Rourke.

Irish oil explorer Providence Resources is in talks with its lenders on how to fund its share of $7m (€6.2m) the company was ordered to pay to drilling firm Transocean by a court in London yesterday.

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Irish stock exchange-listed Providence Resources said it is now "in active discussions" with its financial advisors and lender "to ensure that the company has the appropriate financial resources to satisfy its obligations to Transocean".

The decision is the latest blow to Providence Resources which has struggled to capitalise on its portfolio of Irish off-shore oil finds.

Providence said yesterday that all sides and their legal advisors are in a process to agree the final amount payable to Transocean. Providence will have to pay 80pc of the bill, with its partner Lansdowne paying the balance.

Shares in Providence were suspended in Dublin and London yesterday ahead of a decision on the case by an appeals court in London.

Following the ruling, Providence Resources requested a continued suspension of its shares from trading while it assesses the situation.

"Pending clarification of such matters, and having regard to the company's existing financial resources, the company has requested the continued suspension of its shares from trading on AIM and ESM," it said.

Drilling firm Transocean had appealed a previous ruling that Providence and its partner Landsdowne were not obliged to pay it $19m in connection with drilling activity at the Barryroe field off the Cork coast.

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