Providence Resources, the Irish based oil and gas exploration company, has entered into an exclusive option agreement with PSE Kinsale Energy Limited over the southern portion of Offshore Petroleum Lease 1 (OPL 1), offshore Ireland.
The OPL 1 is immediately adjacent to Providence-operated Barryroe oil field in the North Celtic Sea Basin.
Providence entered the agreement through its wholly owned subsidiary, Exola Limited.
Under the terms of the option, Exola will have the right to earn a 60% working interest in the southern portion of OPL 1 below 4,000′ TVDSS (true vertical depth subsea), through the 100% funding and drilling of an exploration well in the option area to evaluate the resource potential of the basal Wealden reservoir interval.
Providence notes the option does not cover the northern portion of OPL 1 which contains the producing Kinsale gas field and related infrastructure and is owned and operated by PSE Kinsale Energy Limited.
According to the company, the option is exercisable for a period of 3 years and is at the sole discretion of Exola, with any future assignment of equity in respect of the option area, being subject to the approval of the Minister for Communications, Energy and Natural Resources.
Commenting on the announcement, Tony O’Reilly, Chief Executive of Providence said: “We are very pleased to have agreed this option to acquire a 60% interest over a portion of OPL1. This represents a unique opportunity to test a potential eastern extension of the Barryroe oil field.”