British firm Serica Energy finds oil off Mayo coast

A BRITISH exploration company has made the first discovery of oil off the west coast for almost 30 years.

London and Toronto-listed Serica Energy yesterday said that it had found oil in an exploration well where it originally expected to encounter natural gas.

The well is located in the Slyne Basin, around 80km off the Mayo and Connemara coasts, and 40 km south of the Corrib field, where Shell has discovered enough natural gas to supply Irish needs for 10 years.

Serica began drilling there last month, and after probing close to 2,000 metres under the sea bed, discovered oil. A statement said that it is the first such discovery off the west coast in around 30 years.

The company said yesterday that the volume cannot yet be estimated with certainty as it has more technical work to complete, “but the results to date are encouraging”, it added.

Chief executive Paul Ellis said the discovery could mark the beginning of an exciting phase of Irish exploration. However, Mr Ellis told The Irish Times that Serica is still relatively cautious about the find. “We don’t know if it’s going to be commercial,” he said.

He said the find was encouraging, and added that Serica would carry out a survey of the area between now and October, the only period where the weather in the north Atlantic allows exploration work to be carried out.

Mr Ellis pointed out that Serica had expected to find natural gas in the area. Irish company, Enterprise Oil, drilled for oil there in the mid-nineties and found nothing. “That is the way the exploration business works sometimes,” Mr Ellis said yesterday.

He explained that if the oil find does turn out to be commercial, it would be easier to process and get to the market than gas. Local objections have hit Shell’s efforts to get the Corrib gas ashore.

The company’s licence, one of a number of “frontier” permits granted by the Government in recent years, covers three blocks and an area of around 600 sq km. The field where it discovered the oil is named Bandon.

Serica has 50 per cent of the Slyne Basin licence and is running the project’s operations, while German oil and gas explorer and producer, RWE DEA has the other half of the venture.

It is normal practice for exploration risks and costs to be shared in this way. Serica is based in Britain. Along with the Slyne basin, it has exploration and production interests in the Irish Sea, North Sea and off the Vietnamese coast.