Providence given heavy oil option in Celtic Sea

Ireland’s government has issued an exploration permit to Providence Resources covering the Baltimore heavy oil discovery in the north Celtic Sea basin.

Offshore staff

DUBLIN -- Ireland’s government has issued an exploration permit to Providence Resources covering the Baltimore heavy oil discovery in the north Celtic Sea basin.

Licensing option 10/1 relates to block 48/19(p). The 48/19-2 well that discovered Baltimore in 1992 is 30 km (18.6 mi) off the Irish southern coast in water depths of around 100 m (328 ft). Providence estimates that the field has an in-place resource potential of up to 300 MMbbl of 11º API crude.

The well was drilled into a Lower Cretaceous structure of around 12 sq km (4.6 sq mi). According to Providence, it encountered a 300-ft (91.4-m) gross hydrocarbon-bearing section at a TVD of 3,000 ft (914 m) in Lower Cretaceous sands, similar to those in the nearby producing Kinsale Head oil field.

Reservoir cores recovered at the time indicated strong production potential, the company adds, with permeabilities greater than 3,000 md and log-derived porosities of around 27%. However, the well had been targeting a gas prospect and subsequently was plugged and abandoned.

Providence’s resource estimate is based on analysis of available well data and subsurface mapping. It plans further technical studies, along with a review of potential development scenarios.

The company has noted Statoil’s recent work on undeveloped heavy oil accumulations in the UK North Sea. It believes that technologies such as artificial lift, horizontal drilling, and chemical injection all will come into play if Baltimore is to be developed.

Providence Chief Executive Officer Tony O’Reilly said that analysis will be managed by the company’s new division EXOLA.

02/16/2010

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