TIDMLOGP
RNS Number : 8703Y
Lansdowne Oil & Gas plc
08 January 2024
8 January 2024
Lansdowne Oil & Gas plc
("Lansdowne" or the "Company")
New Year Outlook and
Comments on Energy Security in Ireland to 2030 publication
With the completion of the recent equity placing following the
Company's General Meeting on 29 December 2023, the Company is now
focused upon progressing its Energy Charter Treaty claim against
Ireland, following the refusal to award a Lease Undertaking for the
Barryroe oil and gas field ("Barryroe").
On 14 November 2023 the Irish Government finally published its
strategy for Ireland's Energy Security, and having reviewed this
Lansdowne provides the following comments:
The voluminous documentation produced identifies numerous
actions to be taken and the setting up of additional committees,
all to be overseen by a new Energy Security Group (ESG).
Some of the key findings in the report are:
-- Concern about gas supply leading to the need recognized for a
Strategic Gas Emergency Reserve.
-- Also concern regarding oil supply with need to strengthen
National Oil Reserves Agency (NORA).
-- Actions to be taken on both will add further cost burden to consumers.
Lansdowne believes that an alternative pathway, allowing the
development of the Barryroe oil and gas field, would deliver
greater energy security at lower cost and with lower associated
emissions.
Lansdowne considered that the report highlights the following
key risks:
Supply-side risks:
-- As one of the most energy import dependent countries in the
EU with limited diversity of supply, Ireland is exposed to this
risk. In 2022, 82% of Ireland's energy needs came from imports. 48%
of energy used in 2022 was from imported oil and nearly 31% from
natural gas. 74% of Ireland's natural gas came from imports through
two interconnectors from the UK.
-- A disruption of gas supplies from the UK, for whatever
reason, would have a significant impact on Ireland's economic and
social wellbeing.
Demand side risks:
-- The dependence of the electricity system on natural gas is
expected to increase in the short to medium-term, particularly at
times of very low wind. In addition, the peak day demand for
natural gas is expected to increase. This means the electricity
system will continue to rely on natural gas as a fuel source as it
transitions to a majority-renewables system and phases out natural
gas in the medium term.
Introduction of a Strategic Gas Emergency Reserve:
-- It is anticipated that a floating reserve (FSRU) will best
meet the criteria set by the Government.
-- The costs of this state-owned enterprise will be paid for by
an additional levy on the consumer, as applies for NORA (National
Oil Reserves Agency)
The Oil Sector
-- Ireland relies heavily on imports to meet its oil
requirements as it does not produce crude oil and is a net importer
of refined products.
Given all of the above, it is extraordinary that Eamon Ryan
Minister for Environment, Climate and Communications and Minister
for Transport blocked the progress of the Barryroe oil and gas
field, that contains abundant supplies of both fuels, especially
given the application was also noted as being satisfactory from a
technical standpoint.
The development of Barryroe would ensure secure indigenous
supplies of both oil and gas, with lower emissions/carbon
footprint, compared with imports. A study commissioned by Europa
Oil and Gas (Holdings) plc and announced on 7(th) March 2023, found
that the Emission Intensity (EI) from the indigenous Corrib Field
at 5 kgCO2e/boe is 14% of the EI of imported gas from the UK and
3.5% of the EI of LNG imported from the US.
Offshore Wind
Minister Ryan is placing all his faith in developing offshore
wind at scale and at pace. As recognised in the McCarthy Report on
the Security of Electricity Supply, "The ambition to decarbonise
has not been matched by sufficient management of the project
delivery risks, with evidence of an underestimation of risk in the
sector."
A recent article on Offshore Wind in the Guardian newspaper (27
October 2023) commented on the headwinds facing the industry.
Siemens Energy had encountered problems with the turbines it
manufactures and was in rescue talks with the German Government to
secure EUR15 billion to shore up its balance sheet.
Vatenfall AB had stopped work on a windfarm project off the
coast of Norfolk as the recent 40% rise in costs meant it was no
longer profitable.
The Danish windfarm giant Ørsted A/S announced a near GBP2
billion asset write-down due to delays in windfarm projects
offshore the U.S.
On 4(th) January 2024 Equinor ASA and BP Plc announced the
termination of the Offshore Wind Renewable Energy Certificate
(OREC) Agreement for the Empire 2 project offshore the U.S.A.
recognising that "commercial conditions driven by inflation,
interest rates and supply chain disruptions that prevented Empire
Wind 2's existing OREC agreement from being viable."
Conclusion:
It is the Company's view that the long delayed report on
Ireland's Energy Security has taken a blinkered approach, driven
entirely by environmental dogma, and will ensure that Ireland's
energy insecurity will persist to 2030 and beyond and that the
Irish consumer, already paying some of the highest electricity
prices in Europe, will face additional cost burden. Energy
insecurity of this nature will be magnified many times over in the
event that global disruptions occur thus also multiplying the costs
to the Irish consumer. Domestic energy supply can help to alleviate
this multiplier effect.
There is an obvious alternative pathway, to allow the
development of already discovered oil and gas resources in the
Barryroe field, delivering greater security at lower cost and with
lower associated emissions. There is no reliable forecast which
shows an elimination of oil and gas imports to Ireland. Domestic
oil and gas can provide energy security and be provided at a much
lower emissions cost than imported oil and gas.
The Company remains willing to engage in any worthwhile or
pragmatic discussion with the Irish Government, however all
attempts to engage in such conversations at an appropriate level
have been ignored by the Irish government. Without an ability to
engage in a respectful and frank conversation the Company has no
alternative other than to pursue its arbitration efforts under the
Energy Charter Treaty.
For further information please contact:
Lansdowne Oil & Gas plc +353 1 963 1760
Steve Boldy
SP Angel Corporate Finance LLP +44 (0) 20 3470 0470
Nominated Adviser and Joint
Broker
Stuart Gledhill
Richard Hail
Tavira Financial Limited +44 (0) 20 3192 1739
Joint Broker
Oliver Stansfield
Notes to editors:
About Lansdowne
Lansdowne Oil & Gas (LOGP.LN) is an oil and gas exploration
and appraisal company focused on the North Celtic Sea and quoted on
the AIM market and head quartered in Dublin.
In May 2023 the application for a Lease Undertaking for the
Barryroe Field, in which Lansdowne held a 20% interest, was refused
by the Irish Department of the Environment, Climate and
Communications.
In June 2023 Lansdowne announced the commencement of action
under the Arbitration Process of the Energy Charter Treaty.
Since 20 September 2023, Lansdowne has been designated a
"Cash-Shell" under AIM Rule 15.
For more information on Lansdowne, please refer to
www.lansdowneoilandgas.com .
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
MSCDDGDBRDGDGSR
(END) Dow Jones Newswires
January 08, 2024 02:00 ET (07:00 GMT)
Lansdowne Oil & Gas (LSE:LOGP)
Historical Stock Chart
From Nov 2024 to Dec 2024
Lansdowne Oil & Gas (LSE:LOGP)
Historical Stock Chart
From Dec 2023 to Dec 2024
