MercoPress. South Atlantic News Agency

Desire Petroleum plc: Drilling Update

Desire is pleased to announce that the Environmental Impact Assessment, required for
drilling in Tranches C and D in the North Falkland Basin, has been submitted
for approval to the Falkland Islands Government.

The full documentation will be posted on the Desire website.

In order to increase the flexibility of the drilling programme, a detailed analysis of the shallow 3D seismic data, for site- survey purposes, at nine drilling locations, within Tranches C and D in the North Falkland Basin, has been submitted for comment to the Health and Safety Executive (acting for the Falkland Islands Government (FIG)).

In addition, and in response to long lead times for the supply of drilling equipment, Desire has decided to order now, all of the casing needed to fulfil a three-well drilling programme. When received, this casing will be stored in Aberdeen ready for the drilling programme.

Work is now well advanced on all of the fronts necessary to commence drilling as soon as the rig market allows and Desire will continue to review both its drilling programme and well design in order to meet changing circumstances when a suitable rig does become available.

At the recent conference in London on Commercial and Technical Strategies for Managing Exploratory Risk in Frontier Regions Ian Cross, Vice-President of IHS Energy presented a paper entitled ' What can we really expect from unexplored areas- Global elephant hunting. '

In this paper he highlighted the significant exploration wells to be drilled in the World in the next 18 months ie wells with the potential to find a major field with 250 million barrels or more of recoverable oil. In this category he included Desire's wells to be drilled in the North Falkland Basin.

He also noted that there are very few areas in the World where oil fields of this size can now be found with discovery levels now back at the levels last seen in the 1950s.

IHS is a leading global provider of consultancy services and technical information to the oil and gas industry and as such are well placed to provide a global overview of the oil exploration scene.