PVR 2014 Preliminary Results Providence Resources P.l.c. - 2015 Half Year Results LEADERSHIP IN THE IRISH OFFSHORE Dublin and London - September 29, 2015 - Providence Resources P.l.c. (PVR LN, PRP ID), the Irish based Oil and Gas Exploration Company, today announces results for the half year ended June 30, 2015.


Tony O'Reilly, Chief Executive Officer commented:

'To date in 2015, we have further consolidated our leading position in the Irish offshore sector with a diversified portfolio of assets consisting of net audited 2C resources of 358 MMBOE and net un-risked prospective resources of 3,020 MMBOE. In addition to continuing the data room process for Barryroe, we also commenced the evaluation of recently acquired seismic data over a number of our key exploration prospects along the Atlantic Margin. We also recently announced a strategic exploration collaboration agreement with Schlumberger which is designed to unlock the potential of the Southern Porcupine and Goban Spur Basins.

Similar to other junior E&P companies, Providence has been impacted by the fall in oil prices which has led to a significant divergence between our market capitalisation and the underlying value of our substantial resource base. Despite market turbulence, we have remained focused on our core Irish-centric strategy and, with the continued support of our existing shareholders and new institutional investors following our successful fundraising in the first quarter, we continue to prudently invest across our portfolio.


In view of the current challenging global industry environment, the board continues to actively review Providence's corporate strategy and longer term financing options. In this regard, discussions are also ongoing with Melody Finance LLC, the company's debt provider, regarding the possible extension of the terms and maturity of the facility. In addition, the board has initiated a cost reduction programme in order to remove any and all non-essential costs from the business which will deliver meaningful savings going forward.

Providence remains fully committed to offshore Ireland, an area with both exceptional prospectivity and internationally competitive cost and operating dynamics. The potential of the area has been further enhanced by the post well analysis of our Dunquin North exploration well combined with the major oil discoveries in the Flemish Pass Basin, offshore eastern Canada. We believe that first gas from Corrib, together with the record high level of applications for the 2015 Irish Atlantic Margin Licensing Round, are defining moments for the Irish offshore, only serving to further enhance the value of our exploration and appraisal portfolio.'


H1 2015 OPERATIONAL HIGHLIGHTS

  • Barryroe Oil Field, North Celtic Sea Basin
    • Farm out discussions continue with a number of counterparties

    • Successfully defended Transocean litigation case

  • Spanish Point Gas Condensate Field, Northern Porcupine Basin
    • Acquisition of Chrysaor E&P Ireland Limited ('CEPIL') increased the Company's equity in Spanish Point licence from 32% to 58% which delivers a major cost benefit in terms of a promoted partial carry on 2 wells

    • Operator estimated a revised HIIP of c. 730 MMBOE (2,034 BCF & 391 MMBC) and combined contingent plus prospective recoverable resources of up to 337 MMBOE (1,322 BCF & 117 MMBC)

    • Updated well modelling indicated original 35/8-2 vertical well had an undamaged flow potential of c. 10,700 BOEPD (c. 500% flow rate increase over original 1981 well test, which had significant skin factor damage)

  • Drombeg Oil Prospect, Southern Porcupine Basin
    • 3D seismic morphologies consistent with a large Lower Cretaceous deep-water fan system

    • Potential sediment input systems from the nearby Porcupine Bank

    • Class II AVO response evident on initial seismic gather inspection

  • Other Atlantic Margin Prospects, Southern Porcupine and Goban Spur Basins
    • Following the acquisition and evaluation of 3D and 2D seismic in 2014, technical updates were provided on:

      • Druid Oil Prospect, Southern Porcupine Basin

      • Ruadhan 3D Survey (Spanish Point South), Northern Porcupine Basin

      • Newgrange Gas Prospect, Goban Spur Basin

  • Silverback Oil Prospect, South Celtic Sea Basin
    • Initial work indicated un-risked oil in place of 1,360 MMBOE


      H1 2015 FINANCIAL HIGHLIGHTS

  • Operating loss for the period of €3.787 million (€3.016 million in H1 2014)

  • Loss for the period of €8.425 million (€3.374 million in H1 2014)

  • Loss per share of 7.94 cents (5.22 cents in H1 2014)

  • At June 30, 2015, cash & cash equivalents were €11.289 million

  • At June 30, 2015, debt was €15.610 million

  • In March, gross proceeds of c. €25.8 million (c. $28 million) raised via a Placing Offer and Open Offer

  • Fund raise supported by both existing shareholders and new institutional investors

  • Significant increase in depth and diversity of institutional shareholder base


    POST JUNE 30 EVENTS

  • Barryroe Oil Field, North Celtic Sea Basin
    • Farm out discussions ongoing with a number of counterparties

  • Dunquin Oil Prospect, Southern Porcupine Basin
    • Acquisition of 4% stake in Dunquin from Atlantic Petroleum increasing our equity stake to 20%

  • Spanish Point Gas Condensate Field, Northern Porcupine Basin
    • Work continues on pre-drill activities

  • Silverback Oil Prospect, South Celtic Sea Basin
    • Licensing Option extended to November 2016

  • Diablo Ridge, Southern Porcupine Basin
    • A technical update was provided on the new Diablo Ridge contained within the Drombeg Licence

  • Exploration Collaboration Agreement with Schlumberger, Southern Porcupine & Goban Spur Basins
    • Exclusive basin modelling studies to be carried out by Schlumberger

  • Cost reduction programme initiated


    BOARD ACTIONS

    Whilst the company continues to execute on its strategy, general market conditions continue to impact investment sentiment. As a result of this ongoing uncertainty, and to ensure that the Company continues to have in place the necessary resources to meet this dynamic business environment, the board continuously reviews the company's strategy, cost base and financing structures to ensure it is well positioned and appropriately capitalised to take advantage of any improvement in market conditions. In this regard, the Company has already commenced discussions with Melody Finance LLC, its debt provider, with the objective to amend the terms and the maturity of the existing facility, as appropriate.

    Furthermore, since June 30, the board has initiated a cost review exercise to see what non-essential expenditure can be reduced or removed from the business and this is currently forecast to reduce G&A costs by 12% in 2015 (versus 2014) and by 20% in 2016 (versus 2014). Additionally, the company has looked at its sustaining capital expenditure programme and is now forecasting a reduction of c. 40% in 2015 (versus 2014). The Board anticipates further capital expenditure savings will be achieved in 2016 as final operator budgets are prepared.


    ASSET/RESOURCE BASE

    • APPRAISAL ASSETS
      • Barryroe Oil Project, North Celtic Sea Basin (PVR-80%)

        Field Size (2C): 346 MMBOE REC Net to PVR: 277 MMBOE REC

      • Spanish Point Gas Condensate Project, Northern Porcupine Basin (PVR-58%)

        Field Size (2C): 97 MMBOE REC Net to PVR: 56 MMBOE REC

      • Hook Head Oil Project, North Celtic Sea Basin (PVR-72.5%)

        Field Size (2C): 35 MMBOE REC Net to PVR: 25 MMBOE REC

        Gross 2C Resources of 478 MMBOE REC Net to PVR: 358 MMBOE REC


    • EXPLORATION ASSETS
  • Dunquin South Oil Prospect, Southern Porcupine Basin (PVR-20%)

    Prospect Size (Pmean): 1,389 MMBOE REC Net to PVR: 278 MMBOE REC

  • Newgrange Gas Prospect, Goban Spur Basin (PVR-80%)

    Prospect Size (P50): 1,126 MMBOE REC Net to PVR: 900 MMBOE REC

    Newgrange Ridge (P50): TBC

  • Drombeg Oil Prospect, Southern Porcupine Basin (PVR-80%)

    Prospect Size (P50): 1,090 MMBOE REC Net to PVR: 872 MMBOE REC

    Druid prospect size (P50): TBC Diablo Ridge size (P50): TBC

  • Spanish Point Exploration Prospects, Northern Porcupine Basin (PVR-58%)

    Prospect sizes (P50): 749 MMBOE REC Net to PVR: 434 MMBOE REC

  • Kish Oil Prospect, Kish Bank Basin (PVR-50%)

    Prospect Size (P50): 210 MMBO REC Net to PVR: 105 MMBOE REC

  • Polaris Oil Prospect, Rathlin Basin (PVR-100%)

    Prospect Size (P50): 159 MMBO REC Net to PVR: 159 MMBOE REC

  • Silverback Oil Prospect, South Celtic Sea Basin (PVR-100%)

Prospect Size: 1,360 MMBO STOIIP

REC estimated @ 20% = 272 MMBOE REC Net to PVR: 272 MMBOE REC

Gross Un-Risked Prospective Resources of 4,995 MMBOE REC Net to PVR: 3,020 MMBOE REC


BOARD

Having acted as Chairman since 1997, Dr. Brian Hillery retired from the Board in May with Mr. James S.D. McCarthy accepting the Board's invitation to take up the role of Chairman. The Board also established a Nomination Committee and Dr. Phil Nolan was appointed Senior Independent Director.


3

OUTLOOK

The industry backdrop remains very challenging both at a macro level and specifically within our peer group with oil price volatility continuing to delay investment within the sector. However, recent market developments have signalled some positive changes, and market commentary on the forward oil market, coupled with increased M&A activity and the significant industry interest shown in the Irish Atlantic Margin Licensing Round, are all encouraging signs. In such an environment, with our extensive and mature portfolio, we remain well-placed to deliver on our plans and continue to be optimistic about the prospects both for Providence and the overall Irish Oil and Gas sector. We are both determined and uniquely positioned to lead the industry in identifying and realising the significant potential that exist offshore Ireland.


INVESTOR ENQUIRIES

Providence Resources P.l.c. Tel: +353 1 219 4074 Tony O'Reilly, Chief Executive Officer

Dr. John O'Sullivan, Technical Director


Cenkos Securities plc Tel: +44 131 220 9771

Neil McDonald/Derrick Lee


J&E Davy Tel: +353 1 679 6363

Eugenee Mulhern/Anthony Farrell


MEDIA ENQUIRIES

Powerscourt Tel: +44 207 250 1446

Lisa Kavanagh/Rob Greening


Murray Consultants Tel: +353 1 498 0300

Pauline McAlester


ABOUT PROVIDENCE RESOURCES

Providence Resources is an Irish based Oil and Gas Exploration Company with a portfolio of appraisal and exploration assets located offshore Ireland and the UK. Providence's shares are quoted on the AIM in London and the ESM in Dublin.


ANNOUNCEMENT

This announcement has been reviewed by Dr. John O'Sullivan, Technical Director, Providence Resources

P.l.c. John is a geology graduate of University College, Cork and holds a Masters in Applied Geophysics from the National University of Ireland, Galway. He also holds a Masters in Technology Management from the Smurfit Graduate School of Business at University College Dublin and a doctorate in Geology from Trinity College Dublin. John is a Chartered Geologist and a Fellow of the Geological Society of London. He is also a member of the Petroleum Exploration Society of Great Britain, the Society of Petroleum Engineers and the Geophysical Association of Ireland. John has more than 25 years of experience in the oil and gas exploration and production industry having previously worked with both Mobil and Marathon Oil. John is a qualified person as defined in the guidance note for Mining Oil & Gas Companies, March 2006 of the London Stock Exchange. Definitions in this press release are consistent with SPE guidelines.


SPE/WPC/AAPG/SPEE Petroleum Resource Management System 2007 has been used in preparing this announcement.


TERMS USED IN THIS ANNOUNCEMENT

MMBO - Million Barrels of Oil MMBOE - Million Barrels of Oil Equivalent

BCF - Billion Cubic Feet of Gas BOPD - Barrels of Oil Per Day

BOEPD - Barrels of Oil Equivalent per Day AVO - Amplitude Variation with Offset HIIP - Hydrocarbons Initially in Place REC - Recoverable

MMBC - Million Barrels of Condensate STOIIP - Stock Tank Oil Initially in Place

PROVIDENCE RESOURCES P.l.c.

Condensed consolidated income statement

For the 6 months ended 30 June 2015


Notes


6 months ended

30 June 2015

Unaudited

€'000


6 months ended

30 June 2014

Unaudited

€'000


Year ended 31

December 2014

Audited

€'000

Continuing operations

Administration expenses

(3,250)

(2,672)

(6,119)

Pre-licence expenditure

(441)

(245)

(245)

Impairment of exploration and evaluation assets

(96)

(99)

(99)

Operating loss

1

(3,787)

(3,016)

(6,463)

Finance income

23

16

39

Finance expense

2

(4,661)

(374)

(5,065)

Loss before income tax

(8,425)

(3,374)

(11,489)

Income tax expense

-

-

-

Loss for the period

(8,425)

(3,374)

(11,489)

Loss per share (cent) - continuing operations

Basic and diluted loss per share

6

(7.94)

(5.22)

(17.77)


PROVIDENCE RESOURCES P.l.c.

Consolidated statement of comprehensive income

For the 6 months ended 30 June 2015


6 months ended

30 June 2015

Unaudited

€'000

6 months ended 30

June 2014

Unaudited

€'000

Year ended 31

December 2014

Audited

€'000

Loss for the financial period

(8,425)

(3,374)

(11,489)

Items that may be reclassified to profit or loss

Foreign exchange translation differences

6,076

83

2,257

Total income and expense recognised in other comprehensive income from continuing operations


6,076


83


2,257

Total comprehensive expense for the period

(2,349)

(3,291)

(9,232)


The total recognised expense for the period is entirely attributable to equity holders of the Company.

1

PROVIDENCE RESOURCES P.l.c.

Consolidated statement of financial position

As at 30 June 2015


Notes

30 June 2015 Unaudited

€'000

30 June 2014 Unaudited

€'000

31 December

2014

Audited

€'000

Assets

Exploration and evaluation assets

3

96,504

84,670

89,733

Property, plant and equipment

35

40

31

Total non-current assets

96,539

84,710

89,764

Trade and other receivables

338

3,026

1,887

Restricted cash

-

2,928

3,296

Cash and cash equivalents

11,289

18,040

5,256

Total current assets

11,627

23,994

10,439

Total assets

108,166

108,704

100,203

Equity

Share capital

4

25,694

18,151

18,151

Capital conversion reserve fund

623

623

623

Share premium

4

226,998

210,230

210,230

Foreign currency translation reserve

10,719

2,469

4,643

Share based payment reserve

3,996

4,738

4,282

Retained deficit

(184,478)

(168,680)

(176,339)

Total equity attributable to equity holders of the Company

83,552

67,531

61,590

Liabilities

Decommissioning provision

6,875

5,361

6,034

Total non-current liabilities

6,875

5,361

6,034

Trade and other payables

2,129

18,959

13,231

Loans and borrowings

5

15,610

16,853

19,348

Total current liabilities

17,739

35,812

32,579

Total liabilities

24,614

41,173

38,613

Total equity and liabilities

108,166

108,704

100,203

PROVIDENCE RESOURCES P.l.c.

Consolidated statement of changes in Equity

For the 6 months ended 30 June 2015



Share Capital

€'000


Capital Conversion Reserve Fund €'000


Share Premium

€'000

Foreign Currency Translation Reserve

€'000


Share Based Payment Reserve

€'000


Retained Deficit

€'000


Total

€'000

At 1 January 2014

18,151

623

210,230

2,386

5,382

(165,950)

70,822

Profit for financial period


-


-


-


-


-


(3,374)


(3,374)

Currency translation

-

-

-

83

-

-

83

Total comprehensive income


-


-


-


83


-


(3,374)


(3,291)

Transactions with owners, recorded directly in equity

Share options lapsed in period


-


-


-


-


(644)


644


-

Transfer to P&L - Singleton sale


-


-


-


-


-


-


-

At 30 June 2014

18,151

623

210,230

2,469

4,738

(168,680)

67,531

At 1 January 2015

18,151

623

210,230

4,643

4,282

(176,339)

61,590

Profit for financial period


-


-


-


-


-


(8,425)


(8,425)

Currency translation

-

-

-

6,076

-

-

6,076

Total comprehensive income


-


-


-


6,076


-


(8,425)


(2,349)

Transactions with owners, recorded directly in equity

Shares issued in period

7,543

-

16,768

-

-

-

24,311

Share options lapsed in period


-


-


-


-


(286)


286


-

At 30 June 2015

25,694

623

226,998

10,719

3,996

(184,478)

83,552

At 1 January 2014

18,151

623

210,230

2,386

5,382

(165,950)

70,822

Loss for financial year

-

-

-

-

-

(11,489)

(11,489)

Currency translation

-

-

-

2,257

-

-

2,257

Total comprehensive income

-

-

-

2,257

-

(11,489)

(9,232)

Transactions with owners, recorded directly in equity

Share options lapsed in year

-

-

-

-

(1,100)

1,100

-

At 31 December 2014

18,151

623

210,230

4,643

4,282

(176,339)

61,590


3

Consolidated statement of cash flows

For the 6 months ended 30 June 2015


6 months ended

30 June 2015

6 months ended

30 June 2014

Year ended 31

December 2014

Unaudited

Unaudited

Audited

€'000

€'000

€'000

Cash flows from operating activities

Loss before income tax for the period

(8,425)

(3,374)

(11,489)

Adjustments for:

Depletion and depreciation

10

11

18

Impairment of exploration and evaluation assets

96

99

99

Finance income

(23)

(16)

(39)

Finance expense

4,661

374

5,065

Foreign exchange

1,326

(137)

(441)

Change in trade and other receivables

1,549

(135)

1,004

Change in trade and other payables

(11,194)

2,896

(2,855)

Interest paid

(1,512)

-

(1,350)

Net cash (outflow) from operating activities

(13,512)

(282)

(9,988)

Cash flows from investing activities

Interest received

23

16

39

Acquisition of exploration and evaluation assets

(2,190)

(4,680)

(8,221)

Acquisition of property, plant and equipment

(15)

(15)

(14)

Change in restricted cash

3,296

(2,928)

(3,296)

Net cash from investing activities

1,114

(7,607)

(11,492)

Cash flows from financing activities

Proceeds from issue of share capital

25,754

-

-

Share capital issue costs

(1,443)

-

-

(Repayments) / proceeds from loans and borrowings

(6,252)

16,823

16,699

Net cash from financing activities

18,059

16,823

16,699

Net increase/(decrease) in cash and cash equivalents

5,661

8,934

(4,781)

Cash and cash equivalents at beginning of period

5,256

8,998

8,998

Effect of exchange rate fluctuations on cash and cash equivalents

372

108

1,039

Cash and cash equivalents at end of period

11,289

18,040

5,256


6 months ended 30

June 2015

6 months ended 30

June 2014

Year ended 31

December 2014

Unaudited

Unaudited

Audited

€'000

€'000

€'000

Segment net (loss) for the period

UK - exploration assets

-

(2)

-

Republic of Ireland - exploration assets

(96)

(97)

(99)

Corporate expenses

(3,691)

(2,917)

(6,364)

Operating loss for the period

(3,787)

(3,016)

(6,463)

Segment assets

UK - exploration assets

1,879

1,682

1,638

Republic of Ireland - exploration assets

94,997

85,910

88,095

US

-

27

30

Group assets

11,290

21,085

10,440

Total assets

108,166

108,704

100,203

Segment Liabilities

UK - exploration

(57)

(159)

(37)

Republic of Ireland - exploration

(8,882)

(23,437)

(16,176)

US

-

(15)

-

Group liabilities

(15,675)

(17,562)

(22,400)

Total Liabilities

(24,614)

(41,173)

(38,613)

Capital Expenditure

UK - exploration assets

88

360

417

Republic of Ireland - exploration assets

2,102

4,320

7,804

Republic of Ireland - property, plant and equipment

15

15

14

Total Capital Expenditure

2,205

4,695

8,235

Impairment charge

Republic of Ireland - exploration assets

96

97

97

UK - exploration assets

-

2

2

96

99

99

Note 2 Finance Expense


6 months ended 30

June 2015

6 months ended 30

June 2014

Year ended 31

December 2014

Unaudited

Unaudited

Audited

€'000

€'000

€'000

Interest expense

1,399

118

1,467

Amortisation of arrangement fees and other amounts

720

-

516

Unwinding of discount on decommissioning provision

748

256

929

Foreign exchange loss on revaluation of loan

1,794

-

2,153

Total finance expense recognised in income statement

4,661

374

5,065

Recognised directly in equity

Foreign currency differences on foreign operations

6,076

83

2,257

Total finance expenses recognised in equity

6,076

83

2,257


Republic of Ireland

UK

Total

€'000

€'000

€'000

Cost and book value

At 1 January 2014

78,948

1,141

80,089

Additions

2,977

320

3,297

Administration expenses capitalised

1,343

40

1,383

Impairment charge

(97)

(2)

(99)

At 30 June 2014

83,171

1,499

84,670

At 1 January 2014

78,948

1,141

80,089

Additions

6,815

367

7,182

Administration expenses capitalised

1,739

50

1,789

Cash call received in year

(750)

-

(750)

Impairment charge

(97)

(2)

(99)

Foreign exchange translation

1,440

82

1,522

At 31 December 2014

88,095

1,638

89,733

At 1 January 2015

88,095

1,638

89,733

Additions

1,273

70

1,343

Administration expenses capitalised

830

17

847

Impairment charge

(96)

-

(96)

Foreign exchange translation

4,523

154

4,677

At 30 June 2015

94,625

1,879

96,504


Number

Authorised:

'000

€'000

At 1 January 2015

Deferred shares of €0.011 each

1,062,442

11,687

Ordinary shares of €0.10 each

123,131

12,313

At 30 June 2015

Deferred shares of €0.011 each

1,062,442

11,687

Ordinary shares of €0.10 each*

223,131

22,313

Number

Share Capital

Share Premium

Issued:

'000

€'000

€'000

Deferred shares of €0.011 each

1,062,442

11,687

5,691

Ordinary share of €0.10 each

64,649

6,464

204,539

At 1 January 2014

64,649

18,151

210,230

At 30 June 2014

64,649

18,151

210,230

At 31 December 2014

64,649

18,151

210,230

Share issued in period**

75,427

7,543

18,211

Share issue costs

-

-

(1,443)

At 30 June 2015

140,076

25,694

226,998



* On the 20th March 2015, an EGM was held which increased the authorised share capital of the company from 123,131,360 to 223,131,360 shares.


** On the 20th March 2015, the company raised through a placing and open offer approximately $28.0m or (c.€25.8m) before costs by issuing 75.4m shares at GBP £0.25 (€0.34).

distributed by