MercoPress. South Atlantic News Agency

Department of Mineral Resources. February 2001 Newsletter.

Offshore Oil Exploration

Licensed Acreage

The Falkland Islands Government issued seven offshore Production Licences to five consortia in October 1996. The licensed tranches are situated in the Falkland Islands Designated Area to the North of the Islands in the North Falkland Basin where water depths range from 150 to 500 metres and the distance from the shore is between 100 and 250 kilometres. The operators of the seven licensed areas committed to an exploration expenditure of over US$ 150 million during the first five year phase of the licences. This phase ends in November 2001.

The tranches are currently licensed to :

Tranche AOperatorArgos Evergreen Ltd. (Initially Amerada Hess Tranche BOperatorShell Petroleum Development Ltd., (FalklandsBranch) PartnersAgip Exploration B.V. Tranche C, DOperatorDesire Petroleum Ltd., (Initially Lasmo) Tranche F OperatorSodra Petroleum B.V. (Parentcompany is Lundin Oil) PartnersDesire Petroleum Ltd Tranche I, LOperatorDesire Petroleum Ltd

Data Acquisition in the Area

Oil companies with well commitments in the North Falkland Basin embarked on a fast track exploration programme directly from the award of licences. From December 1996 to May 1997 over 7,000 km 2D seismic data was acquired over the area as well as 300 km 3D seismic data and 11,452 km aeromagnetic data. Approximately 2,400 km 2D seismic data was acquired in the third quarter of 1998. Sixteen site surveys were conducted before drilling began and a comprehensive metocean study of the area continued from June 1997 to the end of the drilling programme in late November 1998.

More recently, Lundin Oil, for Sodra Petroleum, acquire a further 2000km of 2D seismic data in the North Falkland Basin using a Veritas survey vessel. The survey was completed in under three weeks in January 2001. These data will increase the geological understanding of the area and assist with identifying new drilling targets.

Falklands Offshore Sharing Agreement (FOSA)

By mid 1997 the companies intending to drill in the North Falkland Basin had agreed to pool resources and share a drilling rig. Amerada Hess, Shell, Lasmo and IPC (o