Providence holds fire on well site after legal challenge

Irish oil and gas explorer Providence Resources is to apply for new permission to survey a well site 50 km off the south coast of Ireland after An Taisce issued a legal challenge to the Government's go-ahead.

The site contains the Barryroe oil accumulation and lies in about 100 metres of water in the North Celtic Sea Basin.

It is operated by Exola, which is a wholly-owned Providence subsidiary. It operates the site on behalf of its partners, Apec Energy Enterprises (50 per cent) and Lansdowne Celtic Sea (10 per cent).

Providence, which is run by Tony O’Reilly, announced plans in September to conduct well site survey operations in preparation for its future drilling programme at Barryroe, subject to regulatory consent.

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The permission for the well site survey operations was granted to Exola in October by then-Minister for Energy John Halligan, with the operations schedules to begin in the fourth quarter of this year using Gardline's Ocean Observer vessel.

On November 15th, Providence was notified that An Taisce had issued legal proceedings against Mr Halligan and the Attorney General with Exola as a notice party regarding the issuance of the permission.

An Taisce sought to challenge the process by which permission for the well site survey operations had been granted by Mr Halligan, as well as raising other issues relative to environmental assessment and compliance with EU law.

As a result of the decision not to act on the site survey permission, Exola has postponed the planned well site survey and will now apply for a new permission to carry out well site survey activities as early as practicable in 2019.

Providence said that Exola was planning to be in a position to conduct its well site survey operations in spring 2019 in advance of the commencement of the planned drilling operations during the third quarter of next year.

Providence chief executive Tony O’Reilly said the company was “frustrated” by the turn of events.

“We complied fully with all environmental and planning regulations in applying for and subsequently receiving the site survey permission,” he said.

“However, with the site survey permission now being the subject of legal challenge, combined with delays with the site survey vessel arriving in Irish waters would have resulted in undue delays to the company carrying out its proposed activities.

“Whilst it is disappointing that this situation has arisen, we felt that it was in the best interest for the overall programme not to act on the site survey permission and re-apply, thereby avoiding any unnecessary costs and possible further delays associated with the judicial review proceedings.

“Whilst this rescheduling will impact the planned start of the multi-well drilling programme at Barryroe, moving it from the second quarter 2019 into third quarter 2019, we believe does not materially impact the timing of the overall delivery.”