Providence agrees one last extension to loan backstop date

Ireland-based energy company Providence Resources updated the market on Standard Exploration Licence 1/11 on Monday, which contains the Barryroe oil accumulation.

The AIM-traded firm explained that SEL 1/11 is operated by EXOLA - a wholly-owned Providence subsidiary which has a 40% working interest - on behalf of its partners, APEC Energy Enterprises and Lansdowne Celtic Sea.

It said the area lay in around 100 metre-deep water in the North Celtic Sea Basin, and was located about 50 kilometres off the south coast of Ireland.

On 5 June, the company announced that it had agreed to certain amendments to the farm-out agreement for the Barryroe Project with APEC Energy Enterprises and, together with EXOLA and Lansdowne, a revised backstop date with APEC for receipt of the $9m loan advance to 14 June.

Following that, on 17 June the Barryroe partners agreed to a further extension of that backstop date to no later than 5 July.

Under the terms of the updated farm-out agreement, that $9m loan was to cover the costs associated with front-end well-site survey operations and pre-drill well consenting.

“Providence has received a HSBC remittance notification dated 5 July from APEC’s funder for the transfer of $10m in favour of Providence’s bank account in Dublin, with a payment date of 9 July,” the Providence board said in its statement.

“Of the $10m, $9m is to cover EXOLA front-end and pre-drill costs, with $1m to cover APEC costs.

“Therefore, a backstop extension to 10 July has been agreed with APEC to allow for the receipt of funds.”