MercoPress. South Atlantic News Agency

Argos Resources raised £ 22 million for hydrocarbons exploration in Falklands

Shares under the symbol ARG should join AIM Thursday

Argos Resources with exploration licences in the North Falkland Basin expects its shares to be admitted to trading on AIM on Thursday 29 July. Argos Resources has raised £22 million (£20.6 million net of costs) in a placing of new ordinary shares at 31 pence per share which will give the company a market capitalisation of £67 million.

The company’s shares are expected to join the AIM market, under the symbol ‘ARG’, on the 29 July 2010.

Earlier this month, the Financial Times reported that Argos was hoping to raise £70 million with a £200 million market capitalisation. Evolution Securities is Argos Resources Broker and Nominated Adviser.

Led by John Hogan, a geologist, who joined the Board in 2005, Argos Resources has a 100% interest in Production Licence PL001 covering an area of approximately 1,126 square kilometres in the North Falkland Basin.

Two wells were drilled on the acreage in the first Falkland Islands drilling campaign in 1998 but the wells were plugged and abandoned as non commercial after having oil shows. The Licence Area also adjoins licence areas being explored by Rockhopper Exploration and Desire Petroleum, who are of course leading players in the ongoing 2010 Falkland Islands drilling campaign.

Argos Resources reckons that approximately 30% of the Johnson Gas discovery, drilled by Shell in 1998 but only declared as a discovery by Rockhopper Exploration in 2009, extends into Licence PL001.

Argos Resources has not had the benefit of access to Rockhopper Exploration’s 3D seismic or any of their proprietary studies and will no doubt have to enter negotiations with Rockhopper Exploration on the subject in due course.

Based on recently reprocessed and reinterpreted 2D seismic data acquired in 1997, Argos Resources has identified seven prospects and five leads in Licence PL001.

According to Argos Resources, the prospects have a total un-risked potential of 747 million barrels of prospective recoverable resource in the most likely case, and up to 1.75 billion barrels in the upside case.

With the funds raised Argos proposes to undertake a 3D seismic program in 2010/2011 to better define a number of those prospects, and potentially to identify new prospects, leading to the selection of possible targets for a subsequent drilling programme in Q4 2011 and 2012.