Oil and gas sector to get €500m of investment
Lack of commercial discoveries and the negative impact of the developments at Corrib have been cited as the main hurdles to the development of the oil and gas industry in Ireland, according to the PwC Oil and Gas survey 2017.
In addition, more attractive investment opportunities elsewhere, and the current regulatory regime here, were listed as further barriers to progress.
While the current successful operation of the Corrib field was a good news story during the year, the report found that the difficulties experienced during its development continue to cast a shadow over Ireland's international reputation in the oil and gas industry.
Overall the report found that €502m is expected to be invested in the Irish oil and gas sector by survey participants in the next two years - up from €300m last year. However this figure remains well below the 2015 high of €1bn.
Of those surveyed, nine out of 10 think that oil prices will remain at current levels or increase in the next two years.
Meanwhile, 78pc said that an oil price in the range of $50-$70 per barrel would be required to support a progressive and sustainable Irish petroleum industry.
Prices are currently in the range of $50-$55 per barrel.
While Ireland would be seen as one of the more "unusual" places for oil and gas exploration, Ronan MacNioclais, partner at PwC, said that as world costs come down, investors are now looking at more unusual places. "The views of economists would suggest that in some ways the current low oil prices represent an opportunity for Ireland, though of course this may not always be the experience on the ground and some significant difficulties remain," Mr MacNioclais said.
For future licensing rounds, the south and north Porcupine Basin were the most popular choice of location, with 52pc of respondents expressing an interest in each, while the basin in the North Celtic Sea was also popular.
When asked about the steps that the Government can take to encourage further oil and gas exploration, maintaining or enhancing fiscal terms was seen as the most important measure, with 85pc of respondents expressing this view.
Streamlining the regulatory process was also identified as a key measure.
Meanwhile, shares in Providence rose by almost 7pc yesterday after the exploration company announced that it expects to commence Phase 1 drilling close to its Barryroe field in the second half of 2018.
In a statement to the Irish Stock Exchange, the company said that the drilling, expected to cost $20m, would materially move the Barryroe East Flank project towards development.