Irish oil and gas explorer Petrel Resources has said it will increase its activity in the Atlantic Ocean's porcupine basin when a new well is drilled in the region next month.
The company made a before-tax loss of €256,505 last year, according to results published on Monday, as compared with a loss of €227,234 in 2015. The results also show Petrel had net assets worth €6.7 million, which was down from €6.9 million in 2015.
In a statement accompanying the results, Petrel said it would increase activity off the coast of the Republic next month.
“After a fallow period there is renewed interest and activity in the Irish Atlantic, particularly the porcupine basin,” it said. “For the first time in recent years a well will be drilled. It is scheduled for July 2017.”
Petrel was awarded two licences covering 924sq km in the porcupine basin after the Government ran a successful bid for new licenses in 2015.
The company cited an increase in the global demand for oil, as well as a slight recovery in oil prices as reasons for the increased activity.
“Exploration costs have fallen dramatically as rig supply and services supply are greater than current demand,” it said. “Technology, particularly seismic and its interpretation continues to improve.
“Boards of directors looking to a future 10-20 years out see the potential of elephant discoveries in the Atlantic. The risk-return equation has moved and the Irish Atlantic is once more attractive to some, not many, but some.
Our projects are risky and fail but over decades we have persisted through wars, political disruptions, legal challenges and geological failures
“But note, only one well is being drilled this year and there are only vague plans for wells next year. If the druid well is successful this year in 2,200m of water it will provide a huge boost to the industry. If it fails, and it is a wildcat, then the risk reward equation will be looked at again.”
In terms of the outlook, the company, which also has interests in Iraq and Ghana, said its track record demonstrated “resilience, adaptability and persistence”.
“Our projects are risky and fail but over decades we have persisted through wars, political disruptions, legal challenges and geological failures,” it said.
“So it is with our present projects. Some have problems but all have great potential. We are very hopeful that the revived interest in offshore Ireland will be rewarded with a successful discovery.
“The money we received from selling our Iraqi interest has sustained Petrel in recent years. Shareholders have not had to provide fresh capital. We have sufficient funds for the near future.”
