Exploration group Fastnet hopes to start shipping oil and gas from two discoveries off the south coast between 2014 and 2016.
The company recently acquired licensing options to two blocks in the Celtic Sea off the Cork coast, 49/13 and Shanagarry, where potentially commercial quantities of oil and gas were discovered in the mid-1980s.
Neither find was economically viable at the time of discovery, but Fastnet believes advances in technology and the higher hydrocarbon prices now prevailing mean both can be exploited.
Executive chairman Cathal Friel said yesterday Fastnet’s current schedule provides for oil production to begin from 49/13 sometime in 2014.
Gas production could take longer, as it would require connecting the Shanagarry block to a nearby pipeline that brings gas ashore from the Kinsale field, which is about 35km west of Fastnet’s field.
Managing director Paul Griffiths agreed yesterday that, all going to plan, the Shanagarry field could begin production sometime around 2015-2016. That means it could come on stream about the same time as the Shellcontrolled Corrib field off the Mayo coast, which is due to start production in 2015.
Mr Griffiths believes the oil reservoir could contain up to 500 million barrels of crude, while Shanagarry could hold between one and three trillion cubic feet of gas, so is potentially on a similar scale to Corrib.
However, he stressed it is not possible at this stage to say how much gas or oil could be recovered. Mr Griffiths and Fastnet shareholder John Craven, who recently led the sale of Cove Energy to PTT for $1.9 billion, were involved in both discoveries in the 1980s.
Difficult and expensive
The oil discovered in 49/13, which is about 40km off the south coast, was “heavy” – that is, more dense than normal crude oil. Extracting it using the technology available at that time would have been difficult and expensive, but advances in drilling and extraction techniques have meant it is now possible.
As a further disincentive, oil prices were low during the period, less than $10 a barrel. “We left it in the ground,” Mr Griffiths said yesterday.
The gas find was made by Marathon, which operated the nearby Kinsale field.
Mr Friel pointed out yesterday that as the Kinsale field is almost spent and there are two gas pipelines linking Ireland and Britain there are ready-made domestic and export markets for the gas from Shanagarry.
