Uchenna Izundu
International Editor
LONDON, Aug. 14 -- Providence Resources PLC, Dublin, and Sosina Exploration Ltd. have granted a 30% stake under a farmout agreement to privately owned Chrysaor Holdings Ltd. for their Spanish Point gas-condensate discovery in the Porcupine basin off Ireland's west coast.
Chrysaor will pay for a 3D seismic program on Spanish Point as consideration for the initial 30% interest. It can increase its stake to a maximum of 70% interest if two appraisal wells are drilled on Spanish Point. This is also dependent on Chrysaor funding at least 60% of the cost while also capping the other partners' cost share.
Their stakes will be reduced pro rata if these conditions are met.
Phillips Petroleum first discovered Spanish Point in 1981 when the well flowed 1,000 b/d of oil and 5 MMscfd from Upper Jurassic sandstones. Providence says the field may contain reserves of 1.4 tcf of gas and 160 million bbl of oil.
Recent pipeline and wellhead technological improvements as well as seismic technology, markets, and higher commodity prices now make this an attractive proposition, Tony O'Reilly, chief executive of Providence Resources told OGJ.
Providence will remain operator of the discovery with a 56% interest during the 3D seismic program and Sosina will retain a 14% interest.
"The proposed assignment of the initial 30% interest to Chrysaor is subject to Irish governmental approval," Providence said.
Contact Uchenna Izundu at [email protected].