MercoPress. South Atlantic News Agency

Fifth company, Argos plans to drill for oil off the Falkland Islands says FT

Dr John Hogan, Chief Executive Argos Resources

A fifth UK company plans to drill for oil off the Falkland Islands after it raises £70m in a London stock market listing, reports the Financial Times. Argos Resources, which holds licences next to the landmark 250m-barrel Falklands’ oil discovery made by peer Rockhopper Exploration in May, hopes to achieve a £200m value on AIM.

People close to the company said Argos began pre-marketing the share offering to investors this week with broker Evolution.

The news comes after three UK oil explorers – Rockhopper, Desire Petroleum and Falkland Oil & Gas Ltd – raised almost £150m to fund a drilling campaign off the Falklands that was condemned by the Argentine government as a violation of its sovereignty.

Rockhopper’s value surged 650% in May after its Sea Lion prospect, which lies just east of Argos Resources’ PL001 license, made the Falklands’ first large oil discovery.

According to the FT Argos, formed in 1995, is led by John Hogan, who worked on Lasmo’s attempts to find Falklands’ oil in 1997. Ian Thomson is the company’s chairman and founder.

Proceeds from the Argos IPO will be used to shoot 3D seismic data and to fund exploration. It is not clear whether Argos will attempt to use the ‘Ocean Guardian’ drilling rig being used by oil explorers on the Islands, or if it plans to use another rig at a later date.

Since exploration around the Islands began this year, Argentina has sought to make it difficult for companies to move in equipment and supplies by requiring special shipping permits to cross Argentine waters to the Islands.

Legislators in Buenos Aires have also approved a bill to impose sanctions on any companies working in Argentina with links to the Falklands’ exploration program. The bill was passed unanimously in the Lower House, an illustration of the depth of feeling across parties and nationally, and is expected to be ratified by the Senate.

Britain says the Islanders have the right to self determination and to develop their own hydrocarbons industry.