Tony O’Reilly jnr quits Providence with immediate effect
Beleaguered oil and gas explorer had been trying to get new partner for key prospect
Tony O’Reilly jnr said that, after more than two decades with Providence, “it is time for me to pursue new opportunities”. Photograph: Dara Mac Dónaill
Tony O’Reilly jnr has stepped down as chief executive of Providence Resources with immediate effect, after a tumultuous year for the oil and gas explorer.
Mr O’Reilly’s announcement follows a series of failures at Providence which ultimately left it without funding to progress drilling at its key asset, Barryroe.
The board said it has now initiated a process to identify and recruit a new chief executive to lead the company in its next phase of development. Mr O’Reilly has agreed to work with the board until the end of January 2020 “to ensure an orderly transfer of his responsibilities”.
In the intervening period, Mr O’Reilly’s functions will temporarily be assumed by company chairman Pat Plunkett.
Mr Plunkett said that Mr O’Reilly leaves by “mutual and amicable agreement” and has the “great appreciation of the board for his management of Providence”.
Recently, however, progress began to unravel at Providence. As late as last week, Providence’s partner on a licence off the southwest coast of Ireland, French oil major Total, pulled out.
More significant, however, was the company’s failure to receive funds from its Chinese backer Apec to to progress its Barryroe licence. Apec repeatedly missed deadlines to transfer $9 million (€8.1 million) in funding that Providence required, leading the company to raise $3.76 million from existing shareholders in September.
It was at that time the Mr O’Reilly said his role as chief executive would be up for discussion if funds promised by the Chinese investors did not materialise before September 30th.
That date came and went, and Providence was forced into seeking a new partner which has yet to be announced. It has also announced plans to slash costs by laying off technical and support staff to cut running costs to $1.9 million a year from $5.3 million a year.
In an announcement to the stock exchange, Mr O’Reilly said that, after more than two decades with Providence, “it is time for me to pursue new opportunities”.
“I am extremely proud of all that we have achieved over the years and the key role that our collective team efforts at Providence have played in establishing interest in Ireland’s offshore arena. I wish all stakeholders in Providence every success in the years ahead, particularly with the Barryroe project.”
Davy analyst Job Langbroek said Mr O’Reilly’s resignation was a “milestone event for Providence, which now requires a new CEO to pursue the group’s Irish offshore assets”.
In particular, Mr Langbroek believed the first task for the new chief executive would be to steer Providence through the appraisal programme for the Barryroe prospect, an asset where its “potential rivals, and is larger than, most mature late-stage North Sea projects”.