40 years and €1.5bn later Barryroe is last hope for Providence
TONY O’Reilly Jnr has resigned as CEO of Providence Resources, the energy exploration firm he helped found in 1997, ending his family’s four-decade involvement in the business.
Providence holds stakes in exploration assets off the coast of Ireland, particularly the Barryroe site off the Cork coast, where it started drilling for oil in 2011 – but has yet to make a commercial strike.
The company, and its predecessors Arcon and Atlantic Resources, along with their exploration partners, have spent an estimated $1.5bn (€1.4bn) prospecting for Irish offshore oil over four decades.
Its latest efforts to tap Barryroe’s potential riches were thwarted this year when Providence’s exploration partner, APEC Energy of China, did not send $9m in finance as Mr O’Reilly had long expected.
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Providence extended APEC’s deadline week by week over the summer before admitting defeat in September, when it made most staff redundant, pruned its board and turned to shareholders to raise €3.5m in new equity.
Shares that peaked in 2008 above £8 (€7), three years after Mr O’Reilly took the CEO chair, have slumped to penny stock status since 2015, following sell-offs of UK and Nigerian interests and a string of false starts in Irish waters.
Before markets opened yesterday, Providence announced Mr O’Reilly had “resigned from the board and all subsidiaries with immediate effect”.
Shares rose 8pc in London on the news – to 3.15 pence.
Mr O’Reilly said in a prepared statement: “After more than two decades with Providence, it is time for me to pursue new opportunities.
“I am extremely proud of all that we have achieved over the years and the key role that our collective team efforts at Providence have played in establishing interest in Ireland’s offshore arena. I wish all stakeholders in Providence every success in the years ahead, particularly with the Barryroe project.”
Chairman Pat Plunkett, an industry veteran late of Tullow Oil, will act as interim CEO while Providence seeks a successor.
“Since the foundation of the company, Tony has been the main driver behind development of the business and has been passionate in promoting the company’s role in oil and gas exploration in the Irish offshore sector,” Mr Plunkett said.
“Over the years, Tony led the company into partnerships with some of the world’s leading energy companies, including ExxonMobil, Eni, Chevron, Repsol, Petronas and Total.
“A major milestone during his tenure at Providence was the successful drilling and testing of Barryroe located in the North Celtic Sea Basin.”
None of the efforts produced commercial success but Davy Stockbrokers said Barryroe was not a lost cause.
“The difficulty and twists and turns … conceal the fact that Barryroe is a substantial target, where oil has been identified in numerous wells,” Davy said. “Its potential rivals, and is larger than, most mature late-stage North Sea projects.”
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