Fastnet wants to retain control of Irish assets

Fastnet Oil & Gas, a Dublin-based exploration company with prospecting licences in Morocco and off the south coast of Ireland, wants to retain a majority stake in its Celtic Sea prospects even if it brings a major on board to fund its drilling programme, according to its executive chairman Cathal Friel.

The company, which opened a “data room’ to prospective buyers of a stake in its Irish operations in March, has held discussions with several international major explorers about a “farm-down” agreement. Friel said he expects a deal to be done “by the end of the year, or before”.

“But we will want to keep at least 50 per cent of the license, and probably more,” he said. “We want to retain majority control.”

In its first-ever results as a public company, Fastnet yesterday said it planned to begin an Irish offshore drilling program in 2015. It costs between $30 million and $40 million to drill a shallow water discovery well, and Friel said Fastnet would drill “one or two” of these off the south coast.

Gas reserves
Fastnet is hoping to find oil in the Celtic Sea although the area is also known to hold some gas reserves, with the nearby Kinsale gas field the first commercial find in Irish history.

It has spent about $19 million on an extensive 3D scan of its Celtic Sea acreage, and it is understood that the company is seeking the return of at least that outlay as part of its farm-down arrangement.

“The minute we find something commercial, we will sell it to the big boys. We won’t be hanging around,” said Friel, who emphasised that Fastnet aimed to specialise in finding oil and gas, but not in developing fields.

The company, which was launched last year and held two fund raisings in June and November, also has onshore and offshore interests in Morocco. Friel said the company’s assets there were kept in a separate subsidiary.

“If we find oil or gas in Morocco, those subsidiaries will be sold of,” he said.

The company has yet to generate any revenues. It reported a loss yesterday of £1.4 million, although it still has almost £21 million on its balance sheet.

Friel said it has no plans to raise further capital, but he added that its cash reserves were “already committed” to projects.