"This is one of the most important stories of it's kind in Europe."
IRISH HYDROCARBON discoveries are like buses; you wait ages and then a couple turn up together. Earlier this month, Tamboran announced that it believes there may be up to 4.4 trillion cubic feet of gas in the rock underlying Fermanagh and Leitrim. Yesterday, Providence Resources revealed that it has encountered high-quality light crude oil in a well in the Barryroe area of the Celtic Sea.
The last notable “commercial” discovery was, of course, the Corrib field off the Mayo coast, from which Shell and its partners, Statoil and Vermillion, hope gas will begin flowing in early 2015.
Providence’s discovery is very different from Tamboran’s. It’s oil, not gas, and it’s around 50km offshore rather than on land. But nevertheless, it qualifies as a hydrocarbon discovery.
The markets certainly think it’s a significant one. Providence’s shares surged yesterday, increasing by over 25 per cent at one point and closing 22 per cent ahead at €4.20.
In the past, the company has made much of the fact that it is the only one with exploration interests around the entire Irish coast. It’s too early to say that its faith in Ireland is going to be repaid, but those who bought at prices approaching €4.29, almost 86 cent ahead of its opening quote, obviously think there’s a good chance that this will happen.
There’s no question the well-documented controversy involved in getting the Corrib project up and running has dented Ireland’s reputation as a location for hydrocarbon exploration. But there are some indications that that is likely to change and a flow of good news from here may serve to perk up interest among the big players once again.
After Shell bought into Corrib, none of the majors turned up here for a while. Perhaps, like the proverbial buses, we could see more than one arriving all at once.