Friday 19 January 2018

Providence shares tumble on €11.5m loss

Providence raised just under €26m in a share placing earlier in the year
Providence raised just under €26m in a share placing earlier in the year

Paul O'Donoghue

Shares in Irish oil and gas explorer Providence resources fell by as much as 10pc yesterday after it announced a loss of almost €11.5m for the year to the end of December.

This compared to an overall loss of about €2.8m the year before.

Operating losses narrowed slightly from €6.46m to €7.23m in 2013. Providence said that the industry backdrop "remains challenging" and added that the current oil price environment "has continued to hamper investment within our sector".

The Dublin-based firm raised just under €26m in a share placing earlier in the year, the proceeds of which is intended to be used to help pay agreed debt facilities of $24m with Melody. Around $20m is scheduled for repayment next year.

Providence said that it is also still in discussions over the potentially lucrative Barryroe oil field with various counterparties.

Terms were agreed with a potential new partner earlier this year though the farm-in deal has remained conditional upon the un-named incoming company securing finance.

This condition has yet to be satisfied, Providence said, and it is currently seeking clarification of the potential partner's position.

The company's chief executive Tony O'Reilly said: "2014 was a year of significant progress on a number of fronts for Providence despite a very challenging backdrop for the oil and gas industry.

"With the support of our existing shareholders and new investors, we have secured additional financing in recent months to allow us continue to execute our strategy."

He said that the company remains focused on building on its "diversified material exploration and appraisal portfolio offshore Ireland and will do so by continuing to leverage in partners with whom we can co-venture and who can help validate the prospectivity of our acreage."

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