Providence Resources primed to tap new Barryroe partners
Providence Resources will, effectively, begin the search for a new development partner for its Barryroe oil and gas field as early as this week, if long-awaited funding from its existing partners fails to materialise.
A promised $9m (€8m) payment from Chinese consortium APEC Energy - which agreed to take a 50% stake in Barryroe last year - has missed numerous deadlines throughout the summer.
The latest deadline is close of business tonight and Providence is expected to update on the matter either tomorrow or Wednesday. Chief executive Tony O'Reilly Jr said Providence will review the funding situation in the next few days, but said the issue has "gone on a little bit too long" for both the company and its shareholders.
Speaking ahead of the deadline, Mr O'Reilly reiterated comments he made at the company's recent annual shareholders' meeting; namely that he remained confident of payment, but that there is unlikely to be any more deadline extensions if the money fails to materialise once again.
"I can't say categorically [if the payment deadline won't be extended further] until we weigh up all the facts. The view of the company is consistent with what I said at the agm [in that] we'd probably not look to extend," he said.
Asked, then, if Providence will be back to square one at Barryroe and searching for new development partners - as early as this week - if payment doesn't arrive, Mr O'Reilly said "there's probably a likelihood of that".
He was speaking after shareholders formally approved a recently announced $3.76m (€3.4m) share placing. That emergency funding move was a direct result of APEC's missed payments and gives Providence financial breathing space up to February.
Mr O'Reilly said Providence will be working on "lots of other scenarios" if the APEC funds are not forthcoming. He also said identifing funding sources beyond February is "a work in progress".
He said if Providence is forced to look elsewhere for development partners "there are other companies that would be interested in talking to us".
He said while the operating environment is becoming tougher for exploration companies it doesn't necessarily mean it should be difficult for Providence to raise cash in the future, if needed.
