One significant discovery ‘could supply’ country’s entire oil needs

Petrel Resources chairman says fiscal implications of one big oil find would be immense

Wed, Jun 25, 2014, 10:50

One significant oil discovery off the Irish coast may be “enough” to supply all of the country’s oil needs and more, according to Irish exploration firm Petrel Resources.

Currently, the Republic imports all of its 132,000 barrel-a-day oil consumption and 95 per cent of its gas needs.

“The importance of a successful oil discovery offshore Ireland cannot be exaggerated,” said John Teeling, chairman of Petrel Resources, which has interest blocks in the Porcupine Basin off the Cork coast.

“One oil discovery in the Porcupine is likely to be big enough to supply all of Ireland’s oil demand if not more. Apart from security of supply, the fiscal implications are immense,” he said.

Publishing its annual results today, the company said it had successfully concluded a farm out agreement on its flagship project in the Porcupine Basin, which includes two hydrocarbon exploration blocks, with Australian energy company Woodside Petroleum.

The agreement provided for the repayment of 85 per cent of all costs incurred by the company, it said.

The company said the wave of investor interest in the Irish offshore which occurred last year had “declined significantly” due to several factors.

The company said the Dunquin drilling by ExxonMobil in the south Porcupine Basin, while finding traces of hydrocarbons was seen by the market as a failure.

The failure of Cairn Energy to drill the Spanish Point block in the Porcupine Basin this year, due to rig problems, has also dampened investor appetite, it said.

Petrel also said the failure by the relevant partners to farm out the Barryroe discovery in the Celtic Sea off the south coast of Ireland had adversely affected attitudes toward offshore Irish exploration in general.

“It is frustrating to make repeated protestations, which are not accepted, that there is no relationship between Celtic Sea geology and that of the Porcupine Basin in the Atlantic,” the company said.

Petrel has a number of energy interests in Iraq, most notably in Block 6 in the Anbar province.

“The situation in Iraq is now very uncertain. War has raged in Anbar province for months. At the present time it is not possible to predict the results of these events but a fragmentation of the country looks possible. We are not giving up on Iraq.”

Petrel remains in a dispute with the Ghanian government over its decision to grant a licence to a US company which the company believes overlaps with its own block.

“With goodwill on both sides a satisfactory solution can be found,” Petrel said.