Higher oil prices have pushed Providence Resources, the oil and gas arm of Arcon International, into profits for the first time. It recorded a pre-tax profit of £330,000 in 1999 (€419,000), contrasting with a loss of £1.9 million (€2.4 million) in an 18 months period to December 1998. The turnabout arose from an effective 39 per cent annual rise in turnover to £1.35 million. The sales were generated from the company's producing interests in the onshore UK Singleton oil field and offshore UK Claymore oilfield.
Its share of production from these fields averaged 280 barrels of oil per day (bopd) at an average oil price of $17.82 per barrel, compared with an average of $14.22 in the previous period.
The profits are attributed to "the significant improvement in oil prices during the second half of 1999 and certain foreign exchange gains, combined with a close control on finances", the group said in its preliminary statement.
As a result of the surge in oil prices the company has decided to concentrate on the appraisal and development of discoveries within the existing portfolio, particularly in the Celtic Sea.
Its main hope remains its 100 per cent stake in a petroleum lease for the Helvick field in Block 49/9 in the Celtic Sea, which flowed 9,900 barrels of oil per day when tested in 1983. The first phase of drilling is planned for later this year.
This is designed to provide further information on the potential recoverable reserves, including areas not tested, and to confirm the expected maximum flow rates. It is reviewing the financing options for this.
Providence is also to extend its exploration into surrounding areas. It has been granted a year's extension to the existing licensing option over Block 50/11 which lies less than 30 km to the east of the Helvic field. This, the statement said, "could contain significant quantities of hydrocarbons".
