Business News

Global 100: Tony O’Reilly Jr, Providence Resources

By Business & Finance
20 August 2012
Tony O'Reilly Jr

Drilling his way to success off the Irish coast, O’Reilly’s Providence Resources has been propelled into the national limelight after its recent oil find.

Tony O’Reilly Jr. is CEO of what is probably the most talked about company in Ireland this year, Providence Resources.

In March, Providence announced that tests at it’s Barryroe well off the Cork coast showed oil flowing at a rate almost double that of pre-drilling targets with a resource conservatively estimated to be at least 59 million barrels.

O’Reilly was appointed as chief of the Dublin-listed oil and gas company in September 2005, having served as a founding director since its incorporation in 1997. Providence Resources is an international upstream oil and gas company currently actively involved in Ireland, the UK, Nigeria and the Gulf of Mexico.

The O’Reilly family own 35% of Providence’s shares, while institutional shareholders hold roughly 40%, and retail shareholders hold the balance.

Since the Barryroe testing announcement, Providence has been offered a new licensing option on five blocks adjacent to the Barryroe oil field and have begun raising $100 million from investors in Ireland and the UK. Including the Barryroe well, Providence and its partners are spending upwards of $500mn in the drilling of wells in six different basins offshore on the island of Ireland. This multi-year programme, which began in November 2011, represents the largest drilling campaign ever carried out offshore in Ireland.

Earlier this year, Providence announced that PR Singleton, which is a wholly-owned subsidiary of the firm, was offered the licence over six blocks in the Rathlin Basin, offshore Northern Ireland by the UK’s Department of Energy and Climate Change (DECC) as part of the UK’s 26th seaward oil and gas licensing round. Providence said the initial licence phase covers six years, and under the terms of the deal, a well must be drilled within this period to progress to the next phase.

Providence recently announced a 36% increase in revenue to €7.7mn for the first half of this year. €28.3mn in impairment charges for UK onshore assets widened operating losses in H1 however to €27.9mn from €3.2mn last year.

The increase in revenue to €7.7mn from €5.717mn is due to increased volumes and higher oil prices with overall production at 97,309 barrels of oil, according to Providence.

The company also announced in September that it has agreed a $66mn sale of its interest in its Singleton onshore oil field in the West Sussex, UK to IGas Energy.

Providence CEO, Tony O’Reilly said that the sale deal with IGas and the repayment of a convertible bond in July, will help free up capital to pursue its Irish drilling programme.

“During what has been an exceptionally busy time for the company, we were also pleased to be able to raise appropriate funding to facilitate our drilling programme, in addition to reducing corporate debt levels. This $66mn transaction will show a substantial gain on our original investment in Singleton in 2007, will result in Providence being debt free and will provide additional working capital to finance our drilling programme in 2013,” he explained.
Prior to his work with Providence, O’Reilly was chief executive of Wedgwood from January 2001 through to September 2005. He was the chairman of the London-listed mining company Arcon International Resources, until it merged with Lundin Mining Corporation in April 2005.

He worked as the CEO of Arcon from 1996 to 2000, having worked in the position of deputy CEO from 1994 and as director of planning and corporate development from September 1992.

In the late 1980s and early 1990s, he worked in mergers and acquisitions at Dillon Read in London, and in corporate finance at Coopers & Lybrand in New York, advising natural resource companies. He is also director of the O’Reilly Foundation.

O’Reilly was educated at Clongowes Wood College in Naas, and went on to graduate from Brown University in Providence, Rhode Island, USA in 1990 with a BA in Economics and History.