Providence Resources confirms Dunquin exploration drilling plans
Providence Resources (LON:PVR) today confirmed that a well will be spudded on the Dunquin exploration prospect in the second quarter of next year.
The Dunquin joint venture partners have now approved the budget for the current year and that includes well design and the procurement of long lead items for the drilling programme, it said.
"We are extremely pleased to confirm that the pre-drill activities for the Dunquin exploration well have commenced and that a spud date has now been scheduled," said chief executive Tony O'Reilly.
"This well forms an important part of Providence's Irish multi-basin, multi-well drilling programme which kicked off in November 2011."
ExxonMobile is the operator of the Dunquin project and it has a 27.5 per cent stake in the venture.
Fellow majors Eni and Repsol are also partners in the project owning 27.5 and 25 per cent respectively. Providence has a 16 per cent stake and Sosina owns the remaining 4 per cent stake.
Last week, Providence gave an update on the Barryroe well, which is the first in the multi-well programme.
The well has now successfully assessed both the upper gas field and a secondary reservoir target.
Drilling is now going ahead through to the primary reservoir target and the result is likely to be ready within around three weeks' time.
Discovered in the 1970s, Barryroe previously flowed oil at the rate of 1,400-1,600 barrels a day.
A flow rate above 1,800 barrels a day makes Barryroe economic, according to an independent report compiled by RPS, which also estimates there is 60 million barrels of crude recoverable from 373 million barrels in place.
The economics of the field show that this one development prospect could be transformational for Providence.
Based on the field's P50 reserves - those with a 50 per cent chance or better of being recovered - the net present value for Barryroe is just over US$800 million using a 10 per cent discount rate.
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