Shares in oil and gas small caps Providence Resources (PVR:AIM) and Lansdowne Oil & Gas (LOGP:AIM) are up 24.4% and 33.2% respectively on news which should bring drilling on their shared Barryroe project closer.
Providence currently owns 80% of Barryroe and Lansdowne 20%.
Providence has been notified that the $10m due from Chinese partner APEC Energy Enterprises has been transferred. In total APEC will put $24m in loans and capital into the development of Barryroe in return for 50% stake.
This initial loan will be used to fund a seismic survey of the Barryroe discovery off the Irish coast.
The funding from APEC had been expected last year, following an agreement with APEC forged in March 2018, but has been delayed multiple times. In turn this had pushed back drilling on Barryroe, which is now expected to take place in the fourth quarter of 2019.
It has been a long and winding road on Barryroe since successful results were announced from an appraisal well on the field back in 2012 with hopes for a farm-out agreement to finance its development raised and subsequently dashed several times.
Little wonder that broker Cantor Fitzgerald says ‘investors will remain nervous until the cash is in Providence’s account’.
This is a reminder of just how difficult and time consuming it can be to get oil and gas developments off the ground.