clickable links:

• Operations Summary PAD ZOOMABLE IRISH CONCESSIONS MAP Upstreamonline ARDMORE ► BARRYROE ► BURREN ► CAMA ► CUCHULAIN ► DRAGON ► DROMBEG ► DUNMORE ► DUNQUIN ► HELVICK ► HOOK HEAD ► KISH BANK ► NEMO ► NEWGRANGE ► ORPHEUS ► PEGASUS ► POLARIS ► SILVERBACK ► SPANISH POINT ► SPANISH POINT SOUTH ►

must be eyeing up a production buy or two.

winner,as of Oilbarrel Presentation 3 weeks ago PVR have tendered for 3 production buy proposals. Could be news on that front very soon.

No.18 on leaders board on LSE yesterday and No.3 on ISE. The comeback has begun and January is only around the corner....

someway to go to get back to years high,if only we had flow tested.
08 looks very positive,plenty of cash to keep us busy and hopefully some good finds to really get the sp moving.

winner,a sizeable acquisition must be on the cards. Lots of dealmakers on PVR Board,Lex Gamble of Smith Barney,Jim Mc Carthy has his own Corporate Finance boutique.Execs Tony O'Reilly and Stephen Carroll are supreme dealmakers too.

Hermana, Could iog be the possible acquistion??

GUTTA,possibly. PRE GOM assets are another possibility. O'Reilly will be receiving many proposals from the Investment Banking community in the very near future.

iog looks fairly good value.I wonder how he market would react,i agree pre gom assets look more attractive though.

winner,ideally buy IOG Celtic Sea assets and PRE GOM assets. Prefer not to inherit the management or apparatus of either of said outfits.

http://www.oilbarrel.com/feature/article.html?body

There is a shortage of prime exploration acreage around the world and companies of all sizes are willing to take another look at basins that theyd walked on by in the past and to wonder whether new technologies might help increase exploration success rates, bring down development costs and so on.

However, there is one simple fact. Everybody, but especially all the countries bordering the Atlantic - whether Ireland, Trinidad & Tobago, in North-West or West Africa, the Falkland Isles faces competition from the country and the Basin with the most opportunities, the most experience in offering leases, the best terms - the benchmark - namely the USA and the Gulf of Mexico. To quote from an Oct 3 2007 US MMS press release:

A Federal sale of offshore oil and natural gas leases in the Central Gulf of Mexico attracted US$904,321,011 in high bids today, the second highest total of high bids in U.S. leasing history. The sale underscores the Gulfs continuing importance as a vital source of domestic energy production for the Nation.

The U.S. Department of the Interiors Minerals Management Service, which conducted Oil and Gas Lease Sale 205, received a total of 1,428 bids on 723 tracts. The sum of all bids received - losing as well as winning bids - was US$2.945,583,944. There were 84 companies participating in this sale.

Yes, thats US$2.9 billion and 84 companies and the best Sale since the 1980s!

That said, what other new exploration provinces might the explorers consider? In this review, I look at what you might call Atlantic Ireland.

There seems to be a bit of a buzz about exploration offshore Ireland nowadays, not seen since the 1980s, with not only a few discoveries being announced, for example, Providence Resources potentially significant oil discovery at Hook Head in the Celtic Sea but more excitement concerning recent and upcoming licence rounds.

One has to give plenty of credit to the Irish Petroleum Affairs Division (PAD) for an innovative approach to telling the geological story of the Irish Offshore, especially the Atlantic Margin.

Back at the Paris AAPG in 2006, there was one presenter that stood out for many people, and that was the Irish PAD. It seems that the Irish had listened to the industry and executed precisely what was required to make the evaluation attractive to exploration managers:
There was a coherent and revealing geological story for the Atlantic margin which enabled new entrants quickly to introduce themselves to the acreage and its potential

The main risks to successful exploration were tackled head-on and the opportunities to mitigate them through the application of technology were explained.
And all this was achieved in six months, with the Paris AAPG as a key milestone in a carefully managed programme. The PAD had a commercial product version of their story available for sale and followed-up on the interest shown with vigour, and a seismic data pack, and a commercial handbook.

What were the elements of this story?

The Atlantic Basins of Ireland are an under-explored frontier petroleum province with proven working hydrocarbon systems. An innovative new evaluation of the area focussed on a major revision of the tectonic and deposition systems evolution.

Atlantic reconstruction shows the juxtaposition of the Porcupine and Rockall basins with the Orphan Basin of Eastern Canada. This reconstruction shed new light on the depositional environments and sediment transport directions, highlighting the possibility of regional world class Upper and Lower Jurassic source rocks and with potential reservoir distribution at four stratigraphic levels controlling the following play systems:

Permo-Triassic (proven by the Corrib and Dooish discoveries)
Middle Jurassic shelf sands (proven in the Connemara discovery)
Lower Cretaceous syn-rift shelf and basinal sands shed from Southern Ireland and Flemish Cap
Tertiary shelf and slope sands
Source rock modelling, lead evaluation and analogue basin review show a multi-billion barrel Yet-to-Find potential, with the structural style allowing for the presence of giant un-drilled structures.

In addition, a review of seismic technology demonstrated that in the areas to the northwest of Ireland, where relatively shallow basaltic sheets represent a severe challenge to conventional seismic imaging, twentieth century progress - especially in super-long-offset acquisition - offered the possibility of being able to image structures beneath basalts for more or less the first time.

All good, and certainly capable of creating a bit of a buzz in the exploration departments of companies large and small.

Unfortunately, whats happened recently is not quite so good!

The most recent licence round to be opened (8th October 2007) was for the Porcupine Basin. The announcement was accompanied by this statement:

Ireland: 160 prospects to drill, according to Hannon Westwood

Up to 160 undrilled prospects are contained within the acreage now on offer in Irelands latest Porcupine Licensing round according to a study on the prospectivity of the region.

Developed in advance of the round using data from Irelands Petroleum Affairs Division (PAD), the GM Matrix Ireland database is claimed to the be the first of its kind.

It contains technical descriptions of prospects, resource information and figures on each prospect both in the Porcupine Basin and other Atlantic Margin areas offshore Ireland.

Since 2004, PAD has been raising the awareness of the petroleum prospectivity of Irelands continental shelf, said Andrew Vinall, technical director of consultancy Hannon Westwood, which has produced the prospect report.

We have designed GMatrix Ireland to demonstrate the undrilled potential of this area, Vinall said. We believe that by incorporating over 30 years of exploration prospect information, we have produced one of the most comprehensive views of potential prospectivity available to the oil and gas industry in any sedimentary basin to date.

Now the question here is who is this study intended for, bearing in mind that it predicts that the Porcupine alone contains more prospects than the whole of the Angolan Deep Water province where not too many more than 50 have been drilled in Blocks 14-18 and 31-34 in the ten years since the first well was spudded in Block 17? Any company with a significant exploration team, so anybody from a medium-sized Independent to a Super-Major, will likely regard this assertion as simply amusing. Surely, the intention cannot be to attract small companies who are so thinly staffed that they know no better!

And the Irish Government has clearly decided that the oil actually exists, the following also appearing as the Porcupine round was opened:

Announcing the offer, Energy Minister Eamon Ryan - whose Green Party entered a coalition government earlier this year - said he was determined Ireland's waters would be fully explored and that the exchequer benefit fully from successful finds.

"The change in the tax regime I announced in August will apply to Porcupine basin finds," he said in a statement.

"Therefore, profitable fields will pay up to 40 per cent in taxation to the Exchequer. That's a top rate increase of 15 per cent for the oil and gas companies involved.

Now it may be true that companies are very keen to find new, preferably, oily hydrocarbon provinces.but not so keen that they are going to accept poor terms before the new ideas, new concepts and new plays have been tested out with the drill-bit. A good example might be Trinidads ultra deep water round earlier this year which attracted just one bid. Now Trinidad is a major producing hydrocarbon centre with the potential for a world class source rock equivalent to the La Luna of Venezuela, to be present in deep water. The reason for the dismal participation in the bid round was attributed to the new terms and conditions of the PSCs, with the government having increased its take of the revenues and the level of taxes.

One lesson from Trinidad is this Dont start counting the barrels until theyve been discovered!

Many, many years ago (OK - it was the late 1960s and early 1970s!), I was involved in geophysical surveying of the Celtic Sea and Porcupine Basin aboard the UKs RRS John Murray, a converted stern-end trawler that didnt take kindly to much of what the North Atlantic had to throw at it. I thought this the worst piece of ocean in the world - until I encountered the Pentland Firth a few years later! I have vivid memories of both and doubt that much has changed in the 35 years or so since I had the fortune to be out there.

My point is this - development engineering in such hostile, relatively deep, waters will be a challenge. Can we hope for benign reservoirs to help us out? The most useful analogue is not that encouraging.

In the 1980s, BP had made a significant discovery (supposedly with circa 220 million barrels of oil-in-place) offshore SW Ireland which produced major excitement but was relinquished because of very difficult reservoir conditions. This discovery was subsequently acquired by Aran Energy and named Connemara; next, Statoil gained a position in Ireland in 1995 through the acquisition of Aran Energy. Statoil quickly announced an FPSO-based development of Connemara, and invested significant capital into appraisal only to find that nothing had changed with the reservoir. Connemara is now operated by Island Oil &Gas (see http://www.islandoilandgas.com/default.asp?docId=12436 for a summary).

Of course, better reservoirs may be found elsewhere in the Basin but overall I suspect we are close to the edge of the envelope of what can be developed today.

The Porcupine Basin is a good example of the challenges facing explorers today. The geologists have been there before but with some imaginative thinking can invent a persuasive, new story about the regional geology. However, at a development level, the reservoirs may be complex and the deep water and hostile environment presents very significant engineering challenges.

Its precisely the sort of area where the concept of mutual advantage is important to persuade companies to commit both the financial and intellectual resources (their Know How) to explore. However, exaggerated prospectivity estimates and dodgy terms speak more to an era that has gone than to the next one.

Im not a betting man but if I was, Id bet that the Majors - with the possible exception of ExxonMobil who already own acreage in the area - will walk on by the Porcupine Basin once again.

My longer review of Atlantic Ireland can be found at: http://www.oilvoice.com/open/Features.aspx.





______________________________________________________________________________

David Bamford is 61. With a Ph.D in Geological Sciences from the University of Birmingham, he had over 23 years exploration experience with BP where he was Chief Geophysicist from 1990 to 1995, General Manager for West Africa from 1995 to 1998, and acted as Vice President, Exploration, directing BP's global exploration programme, from 2001 to 2003. He retired from BP in 2003 and now is a non-executive Director of Tullow Oil plc and of Paras Limited (a specialist oil and gas industry consulting firm), and chairman of NewEyes Exploration Ltd.







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Oil Brat posted this on the DES board today after I asked him his views. IMO it's very interesting. Hope he doesn't mind me copying it here.

PVR are quite significantly under valued and is the one I’m still building a position in. I never wanted them to drill hookhead as it muddled the maths. The target they have with Exxon is huge, 7bn bbls. Run the basic petrophysical / financial calculation and you get 600p+ from a start point of 5p. That’s to big an imbalance so during the drilling phase the price will have to rise to match the potential, I’m guessing that 25p up to 50p would be about right.

Hookhead was a discovery but they can’t prove it directly. I gave them a call and had a long talk with them from a PI / oilman perspective. They got a poor cement job on the final string so didn’t isolate the water. Water will flow preferentially over oil so the well tests were rubbish / flawed. They have modeled production data on the petrophysics that they have and come up with 3-4kbbls a day. I understand what they have done and I understand why they can’t publish it as fact, (if you check their broker you’ll see they carry the number as part of their analysis). But its still there and got going anywhere. On this alone they are undervalued, probably as much as 100%, (if the 3-4k is close to right it’s a tidy find). Their broker gets about 17p I think that number is out of thin air. The second hookhead spuds shortly expect good things from that.

Now look at Exxon, who I have had some dealings with, (not too much but enough). They are strange company and they play a very long term game. They have farmed in to PVR taking 80% but carrying all costs for everything, it’s a great deal for PVR. (Note this please Mr Phipps). The key for me is Exxon shot and processed the seismic which they are very very good at, (their Angola recorded is astonishing with their new technique, I made PVR aware of this which they were most interested in). What did Exxon do after they had processed the data? They (and PVR) mopped up all the unclaimed acreage around the prospect. I put 2 and 2 together and come up with approximately 4.

My understanding on the rumor mill is they are looking for a rig slot for Jan 09, which makes sense and should allow me to expand my position as long as they don’t do anything careless, like discover oil somewhere else in the mean time…

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PVR in market for drill ship for Spanish Point.

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SPANISH POINT 35/8 Appraise Providence Resources N Sea, Irish 2007-9-26 3:11 PM

Glad to see I\'m not the only one who knew PVR tested water from a bum cement job at Hook Head. ;-0

Al,no muckups on reentry in Spring.

As I said when I first posted here - ADTI = cowboys!

Would ADTI be in charge of casing?

Yep, casing and cementing it in ordinarily. ;-)))

BTW, it ain't necessarily easy to prevent muckups in the Spring unless it's properly planned and implemented. There will be remedial work to complete by the sound of it.

Fingers crossed then!