Providence Sells U.K. Fields to IGas to Focus on Irish Drilling
Providence Resources Plc (PRP), the Dublin-based explorer that found more than 1 billion barrels of oil at Barryroe in the Celtic Sea, sold its onshore U.K. operations to help fund further drilling in Irish waters.
The company divested its Singleton field and a 50 percent stake in License 233, both in southern England, to IGas Energy Plc (IGAS) for $66 million, Providence said today in a statement. It will use the funds to pay off debt and finance operations.
Providence is focusing on the Celtic Sea, where it upgraded resource estimates this month. The company plans to drill five more wells in five basins by the end of 2013 after the discovery at Barryroe, where it’s seeking partners for development. The explorer has already teamed up with Exxon Mobil Corp., Repsol SA and Eni SpA (ENI) for its $500 million drilling program.
“In the post-Barryroe world, with a project that will move into production, the benefit of selling the U.K. operations is that it gives us incremental cash and retires all our debts,” Chief Executive Officer Tony O’Reilly said by telephone. “Our focus will continue to be the Irish drilling program.”
Providence rose 1.6 percent to 685 pence in London trading as of 9:07 a.m. local time.
IGas, which also develops coal-bed methane and shale-gas fields in the U.K., is funding the purchase with debt and is in talks with lenders. IGas expects to complete the transaction by the end of the year, it said in a separate statement.
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