A DONEGAL Consortium which was unsuccessful in a bid for an oil exploration licence for the north-west coast has challenged the decision in the High Court this week.

Grianan Energy, which lost out on a licence last year, mounted a legal challenge to the decision of the then Minister for Communication and Natural Resources Noel Dempsey which left them out in the cold.

Four companies were successful but Grianan Energy Ltd lost out on the frontier exploration licence for the Slyne, Erris and Donegal basins.

Grianan Energy Ltd was formed two years ago to bring together a group of Donegal and Derry-based entrepreneurs to take advantage of a licensing round for frontier petroleum exploration licences off the North West coast.

Now the group, which is based in Muff, is seeking an order quashing the decision of the then Minister for Communications and Natural Resources, Noel Dempsey, refusing the application for the licence in March 2006.

The group claims that the refusal was based on a draft rather than Grianan Energy's actual application.

It is also seeking an order quashing the decision of the Minister for Natural Resources in April of this year which refused to reconsider the first decision made.

Grianan Energy is also looking for a declaration from the High Court that no lawful decision has so far been taken in respect of the 2006 application for a licence.