UPDATE 1-Providence Resources hikes oil estimates at Barryroe project

Wed Jul 25, 2012 2:57am EDT

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DUBLIN, July 25 (Reuters) - Dublin-based oil explorer Providence Resources Plc said estimates of oil found off the coast of southern Ireland have more than trebled, slightly higher than analysts' had expected, as it eyes investment from larger players.

Providence said oil in place at the wells stood in a range of 1 to 1.6 billion barrels of oil, against a range of 373 to 893 million in previous estimates provided by third-party specialists.

Analysts at brokerage Liberum had estimated that the flagship Barryroe project could contain around 1 billion barrels oil in place and more than 160 mmb in recoverable oil.

"If developed at $15/bbl with Irish fiscal terms, (this) would be worth around 1,500p per share," said the analysts in a note ahead of Wednesday's announcement.

Providence will have to partner with a larger player at some stage to fund further developments at Barryroe, one of its six drilling programmes.

"Putting out this new oil in place figure ... is really the starting point for future discussions," Providence Resources Chief Executive Tony O'Reilly told Reuters.

"By the end of the year we'll be actively going out into the market, if the market hasn't already come to us," he said, citing Premier Oil's $1 billion deal with Rockhopper a fortnight ago as encouraging.

Shares in Providence closed at 650 pence on Tuesday, valuing the company at 420 million pounds.

Shares in Providence have surged to nearly four-year highs this year on the back of the expectations of an estimates upgrade at Barryroe, in which Providence has an 80 percent interest. Lansdowne Oil & Gas has a 20 percent interest.

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