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Troubled Providence to tap investors for funds to cover capital costs

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Providence's Barryroe site

Providence's Barryroe site

Providence's Barryroe site

Providence Resources will tap investors for funding in the coming weeks, it is understood.

The troubled Irish oil and gas explorer last month said it had sufficient working capital to keep going until early April.

It is understood the company will look for money to cover its working capital costs for around the next 12 months.

In January, Alan Linn, an oil and gas veteran with more than 35 years' experience in the sector, took over the reins of Providence following the resignation of Tony O'Reilly Jnr at the end of last year.

The company last month said its prime focus in the near to medium-term is on the successful appraisal of its flagship Barryroe field, and on finalising plans to facilitate its future development.

Barryroe is estimated to have as much as 310 million barrels of recoverable oil.

The additional funds will be used to support the company in the short-term as it searches for a farm-out partner following the failure of a deal last year with Chinese consortium Apec.

As well as carrying out exploration for oil and gas, Providence is also assessing the potential for a carbon-neutral gas development as an option for the Barryroe field. Several nearby depleted gas fields are being prepared for decommissioning.

Providence said last month it may be possible to minimise the carbon footprint of a Barryroe development by recycling some existing pipelines and infrastructure associated with the depleted fields and participating in a broader carbon capture initiative.

In September 2019 it stopped extending the deadline to receive a $9m loan from Apec, in the latest in a series of delays to the money being transferred.

The group implemented a number of cost-cutting measures during the year, including a redundancy programme, and now operates with a skeleton staff.

Irish Independent