New west coast gas licences

Providence Resources PLC
09 December 2004


                 PROVIDENCE SECURES NEW WEST COAST GAS LICENCES

Providence Resources P.l.c. is today (Thursday, 9th December 2004) pleased to
announce that the Minister for Communications, Marine and Natural Resources,
Noel Dempsey T.D., has granted two new Frontier Exploration Licences in the
Porcupine Basin off the west coast of Ireland. The licences have been granted to
Providence (80%, Operator) and Sosina Exploration Limited (a UK registered oil
and gas exploration company) for a term of up to 16 years. The agreed work
programme comprises a review and reprocessing of existing subsurface data which
will be primarily carried out by Sosina.

The first of these new Frontier Exploration Licences contains two exciting
discoveries - a large gas condensate field known as 'Spanish Point' (IRL35/8-2),
as well as a tested oil discovery known as 'Burren' (IRL35/8-1). The 'Spanish
Point' discovery was made by Phillips Petroleum in 1981. Post-well analysis by
Phillips indicated that the structure could contain up to 1.1 TCF (Trillion
Cubic Feet) of gas and 112 MMBO (Millions of Barrels of Oil) recoverable.

At that time these potential reserves were considered to be uneconomic due a
combination of low oil/gas prices, lack of appropriate extraction technologies
together with remoteness from gas infrastructure. New technologies such as GTL
(Gas to Liquids) together with increased gas prices in Ireland now suggest that
the 'Spanish Point' field is worth re-evaluating for a possible commercial
development. In addition the nearby 'Burren' oil discovery, which has
significant upside potential, may provide a future satellite tieback
opportunity.

The second licence is located in the South Porcupine Basin and contains a
super-giant deepwater exploration target termed 'Dunquin'. The presence of
hydrocarbons at 'Dunquin' has been indicated both directly from seismic acquired
over the prospect as well as from seabed gravity cores overlying the structure.

Providence/Sosina are also commencing a methane gas hydrates study, to assess
the potential occurrence of methane gas hydrates in the deep waters off the west
coast of Ireland. This study will be carried out in close association with, and
as part of, the Irish Petroleum Infrastructure Programme (PIP-PEPPS) together
with the National University of Ireland Galway (NUIG) and the US-based firm
Hydrates Energy International (HEI). The group will utilise data from the Irish
National Seabed Survey and will work closely with The Geological Survey of
Ireland in this regard. Providence/Sosina believe that GTL technology, which may
be brought to bear on the 'Spanish Point' development, may also be applicable to
the future economic extraction of potential methane gas hydrate reserves
offshore Ireland in the form of a 'clean' low emission energy source.


Commenting on the licence award, Company Chairman, Dr. Brian Hillery said:

        'We are delighted to have secured these highly prospective licences in
        an area of increased oil and gas exploration and development activity.
        We look forward to working with our partner Sosina in evaluating the
        potential that these blocks afford and to ultimately progressing them
        towards drilling'.

Ends.                                    Thursday, 9th December 2004

For reference:
Providence Resources P.l.c.
Dr. Brian Hillery, Chairman                   Tel: [phone]
Stephen Carroll, Finance Director
John O'Sullivan, Exploration Manager

Murray Consultants

Pauline McAlester                             Tel: [phone]


NOTES TO EDITORS

'CORRIB' FIELD COMPARISON WITH 'SPANISH POINT'
It is notable that when compared with 'Spanish Point', Shell's recently
announced 'Corrib' field development, situated in a similar water depth and
distance from onshore gas infrastructure, is thought to contain a comparable
-1.0 TCF of recoverable gas.


'DUNQUIN' PROSPECT
Whilst lying in the deeper waters of the South Porcupine Basin (1,600 metres),
the 'Dunquin' prospect provides a world-class high risk/high reward exploration
opportunity. The 'Dunquin' prospect covers some 175,000 acres in Quadrant 44
(Kinsale Head is -25,000 acres) and which provides very considerable upside
potential. Previously licensed by Elf up to 2003, the blocks were subsequently
relinquished following Elf's merger with TotalFina, though their work, which has
since been published, supports the presence of a major Lower Cretaceous reef
system in the blocks. This type of hydrocarbon play is directly analogous to the
Golden Lane fields in Mexico (-5 Billion barrels of recoverable reserves). In
addition, TotalFinaElf noted the presence of both direct hydrocarbon indicators
in the seismic data together with hydrocarbon shows in gravity cores taken in
the seabed overlying the prospect. Providence/Sosina is planning to deploy new
cutting edge geophysical technologies such as CSEM (Controlled Source
Electro-Magnetics), which have been pioneered with great success on deepwater
prospects off West Africa, in order to further progress this vast potential
resource towards drilling.

TECHNOLOGY
Providence/Sosina will primarily focus on the assessment and deployment of
modern extraction technologies such
as horizontal drilling and FPSO (Floating Production Storage & Offloading)
platforms in tandem with emerging process technologies such as Gas to Liquids
(GTL), in order to unlock the value in the 'Spanish Point' field. GTL
technology, which allows for the transformation of methane gas into a 'clean'
low emission diesel fuel, is presently seeing very significant global investment
by the oil and gas exploration and production industry.

METHANE GAS HYDRATES
Gas Hydrates are non-stoichiometric crystalline compounds that belong to the
inclusion group known as Clathrates. Hydrates occur when water molecules attach
themselves through hydrogen bonding and form cavities which can be occupied by a
single gas or volatile liquid molecule. These naturally occurring hydrates
containing mainly methane exist in vast quantities within and below the
permafrost zone and in subsea-sediments, wherever suitable pressure-temperature
conditions occur.

Methane hydrate is found replacing fluid in sediment pore spaces. Permafrost
hydrates are restricted to Polar areas, mainly on land, and associated with
conventional gas and petroleum deposits. Oceanic hydrates, which appear to
contain much more methane than permafrost hydrates, are mainly developed in
marine sediments on continental slopes at water depths exceeding - 500m.


Concentrations of gas hydrate (a solid ore of methane) can be characterized as
shallowly buried strata bound mineral deposits, from which methane gas must be
derived in-situ and then recovered to the surface. Estimates of the volume of
methane in gas hydrate worldwide are firming up at about twice the mass of
carbon held in all conventional gas, oil, and coal deposits combined.


HYDRATES ENERGY INTERNATIONAL
Hydrates Energy International is a new company dedicated to research and
development in the field of natural gas hydrate. The principal gas hydrate
issues that are the focus of HEI are:

 1. Research and development activities leading to commercial extraction of
    natural gas from gas hydrate.

 2. The effect of hydrate on drilling safety and seafloor stability.

HEI delivers special expertise in a broad range of seafloor studies bearing on
natural gas and gas hydrates including the design, commissioning and
interpretation of seismic and other acoustic surveys, optimization of research
and work programs for gas hydrates, modeling of potential gas hydrate
concentrations and the development of integrated hydrate studies.

IRISH NATIONAL SEABED SURVEY
The Irish National Seabed Survey (INSS) encompasses an area that is
approximately ten times the size of Ireland's land area and represents one of
the largest seabed mapping projects undertaken anywhere in the world. The
project is managed by The Geological Survey of Ireland in co-operation with the
Marine Institute.

The INSS is primarily about acquiring baseline information (multi-beam sonar) to
promote and encourage research in marine science. This acoustic technique is
providing detailed bathymetry (water depth) data and knowledge of the nature of
the seabed and its overlying sediment. Magnetic and gravity techniques are
helping to evaluate the nature and structure of the deeper geology. Other survey
techniques are also being used to acquire additional primary datasets including:
single beam echo sounder ,sub-bottom profiler (shallow seismic),water column
measures of salinity, conductivity, temperature and speed of sound profiles
,seabed ground-truthing and sidescan sonar.

GAS TO LIQUIDS (GTL)
Gas to Liquids is a term encompassing a number of processes, whereby, gas
previously without a market can be exploited as a liquid thus creating
commercial value. Around the world there are substantial volumes of gas, often
associated with the production of oil from offshore fields, that are either
flared, re-injected or remain unused because of the lack of ways to bring the
gas to market. Up to 30% of the worlds discovered gas can be considered
stranded.

Natural gas can be used to produce bulk petrochemicals, including methanol and
ammonia, but these are relatively small users of the gas reserves with limited
markets. Liquid and other petroleum products are cheaper to transport, market
and distribute to large markets. These can be moved in existing pipelines or
products tankers and even blended with existing crude oil or product streams.
Additionally, no special contractual arrangements are required for their sale
with many suitable domestic and foreign markets.

New technology is being developed and applied to convert natural gas to liquids
in gas to liquids technology (GTL). The projects are scalable, allowing design
optimisation and application to smaller gas deposits. GTL not only adds value,
but capable of producing products that could be sold or blended into refinery
stock as superior products with less pollutants for which there is growing
demand. Reflecting its origins as a gas, gas to liquids processes produces
diesel fuel with an energy density comparable to conventional diesel, but with a
higher cetane number permitting a superior performance engine design. Another
'problem' emission associated with diesel fuel is particulate matter, which is
composed of unburnt carbon and aromatics, and compounds of sulfur. Low sulfur
content, leads to significant reductions in particulate matter that is generated
during combustion, and the low aromatic content reduces the toxicity of the
particulate matter reflecting in a worldwide trend towards the reduction of
sulfur and aromatics in fuel.


For reference:

Providence Resources P.l.c.

Dr. Brian Hillery, Chairman                   Tel: [phone]
Stephen Carroll, Finance Director
John O'Sullivan, Exploration Manager

Murray Consultants

Pauline McAlester                             Tel: [phone]



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