Providence now aiming to kickstart Dalkey Island drilling plans
Rothschild cranks up Barryroe sale process as buyers jostle for position
Providence Resources, Ireland's biggest oil exploration company, is preparing to start work on its Dalkey Island oil drilling once a regulatory 'Snafu' is resolved.
The Department of the Environment is preparing to amend legislation that will enable Providence Resources to reactivate its foreshore licence, which clears the way for drilling.
Providence handed back its foreshore licence following a legal snarl up over the wording of the permit.
The department had been expected to fix the regulatory issue in May but the timetable has slid. Latest indications suggest that the new wording will be in place before the end of this year.
In its exploration timetable given to investors, Providence has said that it is scheduled to start drilling in the first half of 2015. Providence owns the Kish Bank prospect off Dalkey Island with giant Malaysian oil firm Petronas.
The Dalkey Island prospect is one of a number of high-potential drilling projects being undertaken by Providence in the biggest-ever offshore exploration programme around Ireland.
The seabed lying off the West of Ireland has come in for increased interest from investors following a major oil find by Statoil off the East coast of Canada. Investors may gamble on the same oil bearing geology on both sides of the Atlantic.
The company's Barryroe oil field has dominated investor interest since its discovery last year.
"Following the truly transformational year of 2012, the first half of 2013 continued with a high level of activity," chief executive Tony O'Reilly Jnr told investors last week.
"The main focus of our activities remained the ongoing post well work at Barryroe, the independent audit of resources and the launch of our industry-wide Barryroe farm-out campaign."
Providence has appointed investment bank Rothschild to sell off a stake in Barryroe. This will see another major oil firm carry the €1bn cost of developing the infrastructure in return for the stake.
Analysts have speculated that Providence may be taken over as part of any farm-out deal.
The sales process is understood to be heating up, with a farm-out agreement expected by analysts towards the end of the year.
Petronas is thought to be among those interested, with a number of North American, European and Asian groups also thought to be keen on the asset.