The Providence operation, drilling for oil and gas in the Atlantic ocean off the coast of Ireland

IRELAND'S hopes of becoming a centre for oil and gas exploration received a hammer blow yesterday after drilling for a potentially huge oil or gas field in the Atlantic apparently failed and the world's biggest company said it would not drill around Ireland again.

Exxon, which had been drilling an exploration well at the Dunquin North licence off the west coast of the country, said it did not recover any "commercially viable hydrocarbons" from the well.

It will therefore be plugged, and Exxon does not plan to drill again around Ireland "for the foreseeable future".

The decision to effectively quit Ireland is a huge blow to hopes that explorers may want to drill in Irishwaters and potentially create a windfall for the Exchequer.

Hydrocarbons

Dunquin, which is in the Porcupine Basin about 150km off Kerry, had long been seen as the prize asset for Irish oil and gas with potentially huge reserves of hydrocarbons.

When Exxon began drilling on the licence in April it was one of the most anticipated moves in Irish exploration history. However, Exxon said yesterday that while some residual oil had been found in the well, it was not in large enough quantities to warrant continuing drilling.

"It is disappointing that the Dunquin prospect has proved to be water bearing, with no commercially recoverable hydrocarbons," said ExxonMobil's European exploration director Kevin Biddle.

"This project had a higher level of risk and a higher reward, which unfortunately was unsuccessful. This result underlines the uncertain