Providence Provides Update on Licensing Option 11/9 (Ireland)

Providence Provides Update on Licensing Option 11/9 (UK)

Providence Resources P.l.c., the Irish oil and gas exploration and production company, whose shares are listed in London (AIM) and Dublin (IEX), provided a technical update on Licensing Option 11/9 in advance of the upcoming Third Central & North Atlantic Conjugate Margins Conference. A new third party seismic inversion analysis of the Drombeg prospect will be exhibited at this conference which is being held at Trinity College Dublin on August 22-24, 2012.

Providence (80%, Operator) and Sosina Exploration (20%) were awarded Licensing Option 11/9 (“Drombeg”) as part of the 2011 Irish Atlantic Margin Licensing Round. The Drombeg prospect lies in c. 2,500 metre water depth (c. 3,000 metres below the seabed) and is located in the southern Porcupine Basin, c. 220 km off West Cork, being c. 60 km from the ExxonMobil-operated Dunquin exploration prospect which is due to be drilled Q2 2013.

As mapped, the Lower Cretaceous Drombeg stratigraphic prospect demonstrates a significant seismic amplitude anomaly and low seismic impedance as well as a marked AVO (amplitude versus offset) response. Providence recently engaged Ikon Science to carry out a rock physics modeling and 2D seismic inversion study of the Drombeg prospect using a number of key 2D seismic lines together with regional well data. This study has concluded that the mapped seismic anomaly is consistent with a modeled hydrocarbon bearing sandstone interval which has a seismically derived thickness of c. 200-300 ft. Providence’s mapping shows that the anomaly is aerially extensive covering c. 240 sq km and is interpreted to be the deepwater equivalent of Lower Cretaceous Apto-Albian aged shallow water marine sandstones encountered in the BP-operated 43/13-1 well, drilled in 1988. That well, which was situated c. 80 km from Drombeg, encountered c. 70 ft of net Apto-Albian sandstone (average porosity of c. 19%). An underlying second seismic anomaly has also been identified and modeled to be consistent with hydrocarbon bearing sandstone with a seismically derived thickness of c. 140-200 ft and both anomalies appear to have a potential common down-dip depth termination.

A major Jurassic tilted fault block closure covering c. 150 sq km has been mapped beneath the prospect and a marked fluid escape feature has been identified at its crest. This ‘chimney’ appears to terminate at the down-dip edge of the Drombeg seismic anomaly and provides potential evidence of hydrocarbon sourcing and migration into the prospect.

Speaking today, John O’Sullivan, Technical Director of Providence said,

“While a lot of recent focus has understandably been on our Barryroe oil field, it’s great to be able to provide shareholders with an update on another significant project within our portfolio where we hold a major equity position as we advance towards the drill-ready stage.

“The work carried out by Ikon Science clearly demonstrates that Drombeg offers significant potential, exhibiting many of the key ingredients of a major hydrocarbon accumulation. The evidence of potentially active hydrocarbon migration in this frontier basin has wider implications for our other projects in the southern Porcupine Basin, most notably Dunquin, which is to be drilled in 2013. Given Drombeg’s location and water depth, it is likely that we will seek a capable joint-venture partner with deepwater operating experience though that view may change with positive results from the upcoming Dunquin well.

“We hope to be in a position to update the market on the prospective oil and gas resource potential of Drombeg during Q4 2012.”

Press Release, August 07, 2012