Friday, 16 March 2012

A LITRE OF THE BLACK STUFF...

Stars: Red = Gas, Green = Oil
Ever since I was a child there has been off and on talk about exploiting the potential oil and gas in the Celtic Sea and the western approaches. Work has been quietly carrying on to explore and exploit the resources in Irish territorial waters for many years. Now what drives oil exploration is commercial viability, Esso first discovered oil of Ireland in the 1970s, but at the time it was perceived not to be a realistic commercial prospect, as oil prices were pretty low at the time. As the oil price has rocketed from around $10 to $15 a barrel to around $125 a barrel and demand has risen this is now longer the case.

The search for the ‘black gold’ off Ireland may now be about to deliver some tangible results. Now an Irish company has found the Irish Republic's first viable oil well. The oil exploration company Providence Resources plc has announced that it has made the discovery some 70km off the Cork coast. The exploratory Barryroe oil well has delivered double the amount of oil needed for future full-scale extraction to make commercial sense.

The exploratory well yield comes in at almost 4,000 barrels of oil a day. Providence Resources Plc incidentally also has drilling permits in Northern Ireland. The company is now seeking international investors to help it exploit the well and the surrounding field, which the firm hopes will contain many further viable wells.

At the moment the bulk of Ireland’s energy comes from imported oil. Oil accounts for over 60% of Ireland’s overall energy consumption, significantly above the EU average. As Ireland’s economy grew, so did their reliance on imported oil. Ireland is also heavily reliant on gas and Ireland’s consumption of gas is increasing rapidly. There is now a major international shift from oil to gas as a source for power generation.

With oil supplies expected to decline in the years to come and growing efforts to reduce the emissions of greenhouse gases, many see gas as the primary energy source for the 21st century. In Ireland gas is extensively used for heating and more than 60%of our electricity is also generated by power plants fuelled by natural gas. No wonder there is a degree of excitement in Ireland at this discovery.

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