Tony O'Reilly Jnr., Chief Executive of Providence Resources said:
"These are extremely exciting developments in our Celtic Sea operations. We are delighted that Atlantic Petroleum, Forest Gate and Dyas have joined us in this license, in addition to their recent farm-in to License 2/07. This license contains the highly prospective Blackrock oil discovery, where we have just completed a very encouraging OBS survey, the results of which will now be factored into our future drilling programs.
"All these developments go to the heart of Providence's strategy of continuing to develop and progress its portfolio of exploration, development and production assets. We are hugely encouraged by this progress we have made in the Celtic Sea and very much look forward to continuing to develop our operations there".
New Celtic Sea Exploration Licenses
The Irish Minister for Communications, Marine and Natural Resources today announced that he has approved the granting of a new Petroleum Exploration License to Providence and its existing partners.
Standard Exploration License 3/07 has been granted over part blocks 48/29, 48/30 & 49/26 in the North Celtic Sea Basin. License No. 3/07 is a successor license to Licencing Option 03/1, which contains the "Blackrock" oil discovery.
The OBS (Ocean Bottom Seismic) survey over the Blackrock oil discovery was carried out on Providence's behalf in November 2006 by the Ocean Bottom Instrument Consortium (OBIC). The data have since been processed and interpreted by OBIC. The results support the post-drill interpretation of the 2004 Blackrock well and indicate the potential presence of additional hydrocarbons between the existing well control points. In addition to the OBS data, multi-channel reflection seismic data were acquired along two transects over the crest of the Blackrock structure. These lines indicate that the crestal area is larger than had been previously mapped and also indicates the possible presence of a gas chimney. These encouraging data will now be factored into the assessment of future drilling plans and locations.
New Farm-Out Agreements
A further three farm-out agreements on Providence's Celtic Sea area interest, held under this new Standard Exploration License (SEL) 3/07 are subject to approval from The Minister for Communications, Marine and Natural Resources.
SEL 3/07 which contains the Blackrock oil discovery has recently been successfully surveyed using OBS technology.
The first agreement covers a farm-out of a 15% equity interest in License 3/07 to Dyas BV, a Dutch oil and gas company. Dyas BV is a subsidiary of SHV Holdings NV, a large privately-owned Dutch investment holding company.
The second agreement covers a farm-out of a 10% equity interest in License 3/07 to Atlantic Petroleum (Ireland) Limited, a subsidiary of P/F Atlantic Petroleum. P/F Atlantic Petroleum is a Faroe Island based oil and gas exploration company listed on both ICEX (Icelandic) & OMX (Copenhagen) stock markets.
The third agreement covers a farm-out of a 15% equity interest in License 3/07 to Forest Gate Resources Inc, a Canadian resource company listed on the Toronto Stock Exchange.
These farm-outs follow on from the recent announcements where the above companies farmed into Standard Exploration License 2/07 on similar equity positions.
Subject to Irish governmental approval of these agreements, Providence's equity stake will reduce to 40% in License 3/07, whilst its most recent farm-in partner, Challenger Minerals (Celtic Sea) Limited, (a subsidiary of GlobalSantaFe Corporation) will retain a 15% interest and Midmar Energy Limited, will retain a 5% stake.
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