Multinational oil giants surrender Irish prospect licence
A JOINT venture between four oil and gas explorers has dropped a frontier exploration licence for a prospect in Irish waters.
Irish oil and gas explorer Providence Resources announced the decision as part of a corporate update.
The joint venture, which also included Total, Cairn Energy and Sosina, said it had conducted detailed technical assessments of the area and had concluded it could not recommend any further development of the prospect.
Total, the French oil exploration company, informed the Government of the decision to voluntarily surrender the exploration licence for the FEL 2/14 Diablo site, located off the south-west coast of Ireland, by the end of the year.
It follows Taoiseach Leo Varadkar’s declaration during September’s UN Climate Summit in New York that Ireland would not issue oil exploration licences for the Atlantic area in future, affecting 80pc of the country’s waters.
The status of issued licences, such as the one given to the joint venture, is unaffected by Varadkar’s declaration.
FEL 2/14 was awarded to Providence and Sosina as part of the 2011 Irish Atlantic Margin Licensing Round.
Total currently holds a 35pc stake in FEL 2/14 after farming into the licence in late 2017.
Total’s block partners include Capricorn, a wholly-owned subsidiary of Cairn Energy, which holds 30pc of the prospect.
Providence has 28pc and Sosina holds 7pc.
According to the Irish Offshore Operators Association, about €1bn has been invested in the hunt for oil and gas off the coast of Ireland.
Nearly 160 wells have been drilled in Irish waters since exploration began in the 1970s, with only the Kinsale and Corrib gas fields yielding recoverable hydrocarbons.
In 2012, Irish-headquartered Providence, headed by Tony O’Reilly Jnr, discovered oil at the Barryroe oilfield in the Celtic Sea, 50km off the coast of Cork. The company believes the area holds 311m barrels of recoverable oil.
It is seeking a new partner to help fund the recovery of the oil after APEC, a Chinese backer, failed to provide $9bn (€8.1bn) in funding. Providence said it was laying off technical and support staff to cut running costs.