Exploration company Island Oil & Gas has announced two farm-out deals on two of its projects off the Irish coast.

Island is to give Valhalla Oil & Gas a 20% stake in the Old Head of Kinsale gas field in return for £2m in cash plus a 7.5% royalty. Island's interest in the project now falls to 80%.

Island and Valhalla have also agreed a deal with Oyster Energy, which will allow Oyster the option of taking a 10% stake in the Connemara licence before the end of August in return for cash. The deal would reduce Island's stake from 61.5% to just over 55% and Valhalla's from 38.5% to 34.7%.