Irish exploration company Providence Resources has said negotiations are at an advanced stage on a farm-out agreement at its Barryroe oil field off the coast at Cork.

The agreement would involve a bigger oil company taking a stake in an oil field after a smaller company has already made some progress.

In half-year results this morning, Providence chief executive Tony O’Reilly said: "The Barryroe farm-out remains our main priority.

"Negotiations are now at an advanced stage and we are working hard to satisfactorily conclude this with the objective to return cash to the business and obtain capital funding, whilst also ensuring that Providence retains a material stake in Barryroe, with a clearly defined road map for the timely drilling (2015) and development of the field."

Providence reported a €3.4m loss for the period to the end of June, compared to a €1.3m loss for the first half of 2013.

Shares in the firm ended the day 6% on Dublin's ISEQ following the statement.