Ireland Operations

OFFSHORE WEST OF IRELAND

Frontier Exploration Licence 3/04

DUNQUIN (16% interest)

Dunquin FEL 3/04 is located in 1,600 m of water and lies some 200 km off the west coast of Ireland. The licence term is for a 16-year period which commenced November 2004. The exploration authorisation covers five blocks located in the South Porcupine Basin. Interpretation of existing seismic data has revealed the presence of two giant deepwater exploration targets. Seismic analysis of existing data has suggested that these features are porous and hydrocarbon-bearing. This analysis has been further supported by seabed gravity cores recovered over the area, which contain anomalous traces of hydrocarbons.

In February 2006, ExxonMobil farmed into an 80% equity interest in the licence by proposing a work programme of seismic and drilling, in which Providence has a carried 16% interest. The 2006 programme, which was successfully completed, involved the acquisition of a new 1,500 km programme of long offset 2D seismic data over the area. In addition, 450 km of existing 2D seismic data (which were acquired in 1999 by a previous operator) were also reprocessed. In addition, the Dunquin partners entered into an Area of Mutual Interest (AMI) agreement in the South Porcupine Basin which covers a nine quadrant area (circa 70,000 square km). This agreement subsequently led to the successful application for c. 6,750 sq kilometers of additional acreage in the area.

In March 2008, the Company announced that, by agreement, ExxonMobil assumed operatorship of the Dunquin licence. Additionally, and as had been anticipated following ExxonMobil’s entry to the Dunquin licence in February 2006, ExxonMobil advised the Company of their intention to farm out a portion of their equity of the Dunquin. This process is presently underway.