Island Oil & Gas has declined to exercise an Option Agreement with Lansdowne Celtic Sea Limited to farm into an area of Standard Exploration Licence 4/07 covering part blocks 49/11(p), 49/12(p), 49/13(p), 49/17(p) and 49/18(p) in the Celtic Sea offshore Ireland. The Option Agreement allowed Island to secure rights to protect acreage in the event that any structures defined by seismic acquisition in Island’s Old Head of Kinsale Licence extended into the Option Area.

Following the acquisition, processing and interpretation of a seismic survey over Standard Exploration Licence 4/05 (the “Old Head of Kinsale”), covering part blocks 49/17(p), 49/22(p) & 49/23(p), Island now believes that it has sufficient materiality within its existing licence boundaries to progress its near-term strategy.

• Gas storage: as security of supply develops as a key theme in the European gas market, the Celtic Sea gas fields have been identified by major players as having potential for either an Irish or western European gas storage facility

• Satellite near-developments: the development of satellite gas fields close to the Celtic Sea infrastructure

Commenting on the decision, Chief Executive Paul Griffiths said:

“Recent events have highlighted the importance of having sufficient gas storage capacity to meet unforeseen circumstances. Security of supply will remain a key strategic goal for all European states – the majority only have a number of days emergency storage capacity.

Island is committed to realising the potential of its undeveloped Old Head of Kinsale and Schull gas fields. We believe that there is an opportunity to contribute both to a material increase in Ireland’s gas storage capacity, and also gain a significant commercial advantage through our dominant asset position”

Tags: Island Oil & Gas