Tuesday 16 July 2019

Providence further extends deadline for €9m funding advance

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

Ellie Donnelly

Providence Resources has extended its deadline to receive a $10m (€8.9m) funding advance from Chinese backer APEC.

The Dublin-listed oil and exploration company received a letter from HSBC Bank on July 5, advising that the funds would be paid on July 9.

However, in a statement today Providence said that as of close of business yesterday no funds had been received and it has not got any additional paperwork from APEC or its corresponding bank to verify the transfer of funds. 

Providence and its partners – known collectively as ‘the Barryroe partners’ – said it has been given assurances that the transfer process is underway, but as of last night was not complete.

“The Barryroe Partners are seeking immediate clarification from APEC’s funders and its banks on the precise status of the transfer. Accordingly, to facilitate this, the Barryroe Partners have agreed to extend the backstop date to close of business on Friday, July 12, 2019,” Providence said.  

“Should [the partners] either not receive the required funds or adequate evidence that the transfer will be processed as a matter of urgency, the board do not envisage giving any further extensions to the backstop date,” it added.  

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, this deadline was then extended to July 5.

Drilling operations at the Barryroe site, 50km off the Cork coast, 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, which is the operator of the Barryroe project. These costs include the well-site survey operations and other project related expenditure.

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