MercoPress. South Atlantic News Agency

Rockhopper confirms drilling of two wells in Falklands’ waters

A busy summer of oil exploration in the South Atlantic

Rockhopper Exploration oil and gas company which operates in the North Falkland Basin confirmed this week it was considering various options, including a share sale, to fund drilling activities scheduled to begin this coming austral summer in the South Atlantic

Responding to media speculation about an equity financing, the company also said it intended to drill a minimum of two wells on its operated acreage, along with partner Desire Petroleum, which has contracted an exploration rig to drill at least four wells in the Falkland North Basin beginning February.

The Financial Times reported this week that Desire Petroleum was looking to raise 50 million pounds (80 million US dollars) by selling new shares at 75 pence each, while Rockhopper was planning to raise up to 50 million pounds by selling shares at a price yet to be determined, to help finance their drilling programs in the Falkland Islands.

On September 10 Desire Petroleum signed a contract with Diamond Offshore Drilling (UK) Ltd to secure a rig to drill a minimum of four wells in the Falklands Islands.

The last oil and gas exploration campaign in Falklands’ waters was in 1998, when Shell Oil struck some promising deposits, but the whole operation was suspended following the collapse of the oil market at the time.

Desire Petroleum announced that prospective un-risked recoverable resources net in Falkland Islands waters are “over 3 billion barrels of oil in the company’s ten top prospects”. The estimate is based of a recently completed Competent Person’s Report, CPR. More over at 50 US dollars the barrel price, the minimum economic threshold can be estimated in a 56 million barrel recoverable field.

Desire which has focused its exploration efforts in the North Falkland Basin commissioned a CPR from Senergy Limited (UK), which is considered a major independent consultancy specializing in reservoir engineering, geology, geo-physics and petroleum economics.