Providence Resources (LON:PVR) this morning reported that its had identified what could be a significant gas accumulation on the same North Celtic Sea option licence that contains the Baltimore heavy oil discovery. Providence got its hands on the option to acquire licence 10/01 in February this year and later signed a 40% farm-out deal with Nautical Petroleum (LON:NPE) , which committed to carry out a specific work programme to assess the development feasibility of the Baltimore oil discovery – this work is ongoing. As part of the Nautical study, the option and surrounding area were mapped using available seismic data and this has revealed the new Marlin exploration prospect which is located around 10 km north-west of the producing Kinsale Head gas field.

This structure, which is the same age as the primary producing reservoirs in the Kinsale Head gas field, has been mapped to extend beyond the current option area. Accordingly, the Baltimore partners applied to the Minister for Communications, Energy and Natural Resources for an increase in the area covered by the option to include the mapped extension of the Marlin prospect into open acreage. Geological modeling of the Marlin prospect suggests that it is likely to be gas charged with a total resource potential of up to around 74bn standard cubic feet of gas.

John O’Sullivan, the technical director of Providence, said: “We are excited about this new exploration prospect as it is in the same geological setting as other proven producing fields in the region and it is very close to the Kinsale Head production facilities. In particular, the Marlin prospect demonstrates striking similarities to the nearby Ballycotton gas field, which is a highly successful offshore development.”

Last week, Providence kicked off drilling operations as part of its 2010 drilling programme at the Singleton oil field, onshore UK. The Singleton field is located in the Weald Basin and currently produces around 800 barrels of oil equivalent per day (boepd). The drilling programme includes the sidetracking of the X9 well to a new and more optimal location together with the addition of two new lateral sections to the currently producing X8x well, potentially providing around 350 boepd of additional cumulative production.

In May this year Providence pulled out…

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