Eni takes stake in Providence's Dunquin licence

Italian energy group Eni has taken a stake in Providence Resources' Irish offshore 'Dunquin' licence, the oil and gas company…

Italian energy group Eni has taken a stake in Providence Resources' Irish offshore 'Dunquin' licence, the oil and gas company said today.

Under the agreement, Eni will assume half of US oil fiorm ExxonMobil's 80 per cent share in the licence off the west coast of Ireland. ExxonMobil will retain 40 per cent, while Providence and minority partner Sosina will retain 16 per cent and 4 per cent respectively.

ExxonMobil, Providence and Sosina will also assume a cumulative 40 per cent interest in the adjacent Eni-operated Frontier Exploration Licence 1/99.

"The Exxon-ENI transaction is good news for Providence," Caren Crowley, analyst with Davy Stockbrokers wrote in a note.

"The deal gives further third-party validation on Dunquin and brings Providence into partnership with another major oil and gas company. More importantly, the farm-out was an essential step for Exxon before committing to a well and as such the transaction now clears the way."