Saturday 24 August 2019

Providence again forced to extend Chinese funding deadline

Delays: The Barryroe operation, 50km off the coast of Cork
Delays: The Barryroe operation, 50km off the coast of Cork
Ellie Donnelly

Ellie Donnelly

Irish oil and gas exploration group Providence Resources has extended a deadline to receive $10m (€8.9m) from Chinese backer APEC to July 26.

It was the latest in a series of delays.

The Dublin-listed company previously said it had received a letter from HSBC Bank on July 5, saying the funds would be paid on July 9.

The backstop to receive the funds was then extended to July 12, when the group, headed by Tony O'Reilly Jnr, said it did not expect to give any further extension.

However, the deadline was subsequently extended till July 19.

In a statement today, Providence said it has received further documentation showing the mechanics of the transfer of the $10m (€8.9m) in funds to its account. 

"However, due to ongoing banking processing delays, the funds have yet to be credited to Providence’s account," the group said. 

Providence and its associates, collectively known as the 'Barryroe Partners,' have agreed to a backstop extension of July 26 for receipt of the money.

The company said further updates would be issued as and when appropriate.

The loan is to be used to fund a survey of the Irish oil and gas explorer's Barryroe prospect off the Cork coast.

Funding from APEC had initially been expected late last year, and was then due to be paid over on June 14.

Drilling operations at the Barryroe site are expected to take place in the fourth quarter of 2019, a date that has been pushed back because of the delay to the planned survey at the site.

The group now expects the survey to be carried out in the third quarter of this year, assuming it receives the funds.

Under the terms of the updated farm-out agreement with APEC, a total of $24m (previously $19.5m) has been allocated to fund the forward costs of Exola, operator of the Barryroe project.

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