Until now, the hunt for oil in Irish waters has been firmly focused on the North Celtic Sea basin, a relatively shallow area south of Cork where Providence Resources (PVR) discovered 1.6bn barrels of oil in place at Barryroe last year. But in a few short months, that could all change.
Providence and majority partner ExxonMobil spud the long-awaited Dunquin exploration well in April, a $175m (£115m) punt on the Emerald Isle's hottest frontier: the Porcupine basin in the Irish Atlantic Margin. Located some 200km off Ireland's west coast, the deepwater Porcupine basin has been attracting the attention of several large oil explorers of late because of its geologic similarities to the huge oil-bearing structures in the Atlantic margins offshore West Africa and French Guiana.
Atlantic Margin plays up and down the west coast of Africa have proved hugely successful in recent years - including the highly profitable Jubilee field offshore Ghana, discovered by Tullow Oil (TLW) and Kosmos Energy in 2007 - and billions of euros could be made should the Irish Atlantic Margin prove to be the next big extension. Irish government estimates from 2006 suggest up to 10bn barrels of oil-equivalent resources could ultimately be found there.
Certainly, New York Stock Exchange-listed Kosmos sees potential in the region. It struck deals in April potentially worth more than $200m by farming into a number of exploration licences in the Porcupine Basin held by Europa Oil & Gas (EOG) and Antrim Energy (AEY). Kosmos plans to conduct 3D seismic surveying on the licences ahead of a decision to drill two exploration wells in 2015.
Out-of-favour explorer Cairn Energy (CNE) has also decided to get in on the action. Last week it agreed to farm in to two licences containing the Spanish Point and Burren discoveries that are minority owned by Providence Resources. Both licences are in the Porcupine Basin and Cairn plans to drill the first appraisal well at Spanish Point in the second quarter of 2014.
Meanwhile, at Dunquin, Providence and Exxon say drilling should take between three and four months, excluding potential well testing. The partners are hoping to find an enormous gas-condensate accumulation that would rival many of the world's biggest offshore discoveries in the past decade. Mid-case estimates based on seismic data suggest Dunquin could contain 8.4 trillion cubic feet of gas and 316m barrels of oil-equivalent consdensate or light oil in a success case.
