MercoPress. South Atlantic News Agency

FOGL doubles oil acreage and seismic surveying

Falkland Oil and Gas Limited (“FOGL”) announced Tuesday that it has been awarded an offshore production licence for an additional 50,000 sq km by the government of the Falkland Islands; the licence area is adjacent to its existing licences where FOGL is in a Joint Venture with Hardman Resources from Australia. A 2D seismic survey program extensive to the whole acreage is scheduled to begin this summer.

FOGL already holds a 77.5% interest in licences covering 33,000 sq km to the south and east of the Falkland Islands, with its joint venture partner Hardman Resources holding the remaining 22.5%, and the Company now has 100% of the new 50,000 sq km licence area. As a result FOGL now has an interest in a total of 83,000 sq km.

Furthermore Geophysical Services Incorporated ("GSI") has been contracted to undertake a 2D seismic survey on FOGL's Joint Venture acreage and that survey will now be extended to include the new area. This will enable the mobilization and demobilization costs to be spread over both licence areas.

It is expected that the seismic survey over both the new and the Joint Venture areas will amount to over 10,000kms of 2D seismic lines. The surveys will investigate the 8 leads already identified in the 33,000 sq km Joint Venture area as well as providing a 5,000 km reconnaissance grid of new seismic lines in the new 50,000 sq km area. These new data will be used to high grade the 8 leads, to investigate other parts of the Joint Venture licence area and to provide the first ever seismic survey of the new 50,000 sq km area.

"We are very pleased to have secured the offshore production licence for this additional acreage, which is intended to provide the company with opportunities to the North East of and on trend with the leads in the company's Hardman Joint Venture area", said John Armstrong, Executive Chairman of FOGL, adding that "FOGL now has licences covering a vast area and has by far the largest acreage of any company operating in the region".