Oil and gas exploration off Ireland’s west coast is likely to step up over the next year despite ExxonMobil’s exit last week.
The oil major abandoned a well it had drilled in the Dunquin licence about 150km from the southwest coast after finding just residual quantities of oil and some water there. A spokesman said it had no further plans to drill in Irish waters.
Commercial oil and gas
Its move was seen as a blow to hopes of a fresh wave of exploration in the Republic's territorial waters and particularly along the high-risk, deep-water Atlantic margin, whose geology indicates it could hold commercial quantities of oil and gas. However, there are indications up to 10 consortiums are still preparing to begin full-scale exploration activities, including drilling, in this area.
Minister for Communications, Energy and Natural Resources Pat Rabbitte recently told the Dáil eight-10 of the 13 exploration licence options issued by his department in 2011 are being converted to full licences.
According to the department, this will require licensees to submit a full work programme for the areas assigned to them “progressing ultimately to the drilling of exploration wells”.
It could take up to three or four years before any drilling begins but, in the meantime, licensees will have to carry out further studies of their acreage, including three-dimensional seismic studies, a process that allows them to build a detailed picture of what lies under the seabed.
The options are due to expire in November. The department described their conversion to full exploration licences as a “very positive development”. Its spokeswoman would not say which firms are in the process of converting their licences as the information is commercially sensitive.
It is thought London-listed exploration specialist Europa Oil & Gas Holdings, which holds two options, is seeking to convert both to full licences.
Local operator, Providence, also a stakeholder in Dunquin, has shares in four of the licence options issued in the 2011 round.
Odds of 32/1
The success rate of exploration activity in Irish waters remains low and the odds against hitting a commercial find stand at 32/1. Fergus Cahill, chairman of the Irish Offshore Operator's Association says more exploration could result in a higher strike rate.
