Providence Resources Awarded Licenses Offshore Ireland

Providence Resources reports that the Minister for Communications, Marine and Natural Resources, Noel Dempsey T.D. has granted two new Frontier Exploration Licenses in the Porcupine Basin off the west coast of Ireland. The licenses have been granted to Providence (80%,Operator)and Sosina Exploration Limited (a UK registered oil and gas exploration company)for a term of up to 16 years. The agreed work program comprises a review and reprocessing of existing subsurface data which will be primarily carried out by Sosina.

The first of these new Frontier Exploration Licenses contains two exciting discoveries -a large gas condensate field known as 'Spanish Point ' (IRL35/8-2),as well as a tested oil discovery known as 'Burren ' (IRL35/8-1).The 'Spanish Point ' discovery was made by Phillips Petroleum in 1981.Post-well analysis by Phillips indicated that the structure could contain up to 1.1 TCF (Trillion Cubic Feet)of gas and 112 MMBO (Millions of Barrels of Oil) recoverable.

At that time these potential reserves were considered to be uneconomic due a combination of low oil/gas prices, lack of appropriate extraction technologies together with remoteness from gas infrastructure. New technologies such as GTL (Gas to Liquids) together with increased gas prices in Ireland now suggest that the 'Spanish Point ' field is worth re-evaluating for a possible commercial development. In addition the nearby 'Burren ' oil discovery, which has significant upside potential may provide a future satellite tieback opportunity.

The second license is located in the South Porcupine Basin and contains a super-giant deepwater exploration target termed 'Dunquin'. The presence of hydrocarbons at 'Dunquin' has been indicated both directly from seismic acquired over the prospect as well as from seabed gravity cores overlying the structure.

Providence/Sosina are also commencing a methane gas hydrates study, to assess the potential occurrence of methane gas hydrates in the deep waters off the west coast of Ireland. This study will be carried out in close association with, and as part of the Irish Petroleum Infrastructure Program (PIP-PEPPS) together with the National University of Ireland Galway (NUIG)and the US-based firm Hydrates Energy International (HEI).The group will utilize data from the Irish National Seabed Survey and will work closely with The Geological Survey of Ireland in this regard. Providence/Sosina believe that GTL technology which may be brought to bear on the 'Spanish Point ' development may also be applicable to the future economic extraction of potential methane gas hydrate reserves offshore Ireland in the form of a 'clean ' low emission energy source.

Commenting on the license award Company Chairman, Dr.Brian Hillery said: "We are delighted to have secured these highly prospective licenses in an area of increased oil and gas exploration and development activity. We look forward to working with our partner Sosina in evaluating the potential that these blocks afford and to ultimately progressing them towards drilling ".