'Oil in two years' report lifts Providence shares
Published 19/02/2011 | 05:00
SHARES in Providence Resources rose more than 8pc yesterday after a report suggested that oil at one of its sites off the Irish coast could be brought to production in as little as two years.
A "competent third person's report" -- essentially an independent assessment -- of the Barryroe and Helvick oil discoveries in the Celtic Sea off the south-east coast has found that first oil could be produced within two years of the project beginning at Helvick.The report was carried out by FPS Energy for Lansdowne Oil & Gas, but Providence holds half of Barryroe and 62.5pc of Helvick.
"Under the current conditions of high oil price, commercial production could be achieved, which could lead to first oil within two years of project sanction," the report said.
Providence estimates to have 31.8m barrels of oil (MMBO) between the two sites. Although Helvick has a relatively small oil volume at just above 3m barrels, the fact that oil is still more than $100 a barrel and expected to go even higher makes drilling at the site commercially viable.
On Wednesday, it announced it had completed a placement that raised some £41m to fund a drilling programme at a number of its sites around the Irish coast. That will include drilling two appraisal wells at Barryroe, which is estimated to have recoverable resources of 58 MMBO.
Providence closed up 8.38pc at €3.36. The stock gained 22pc in the week.