Gaelic Resources, the exploration company, said yesterday its newest acquisition, European Hydrocarbons, gave it a 30 per cent interest in a North Sea production licence which has the potential to contain 280 million barrels of recoverable oil, with an upper case "possibly of more than 1 billion barrels".

A group of five Portuguese licences, in which the company has a 25 per cent stake, have the potential to contain "in the range of 1 to 10 trillion cubic feet" of gas, Gealic added.

The company said it had reduced sharply its losses for the first six months of the year, compared with the same period in 1996. Losses to June 30th 1997 were down to £88,808, compared with £629,334 to the end of June 1996. The previous year's high level of loss was attributed to the write-off of intangible assets relating to the expiry of an Irish licence.

Earlier this month, it was revealed that the six directors and secretary of Gaelic Resources had made combined paper profits of about £2 million from share options and warrants issued as part of an acquisition. The firm's chairman, Mr Ian Forrest, said yesterday that the management team would now re-introduce Gaelic as a high-profile exploration company.