Rockhopper Exploration plc (AIM: RKH), the North Falkland Basin oil and gas exploration company is ready to begin a flow test on the Sea Lion discovery which should give an early indication of the production potential of the reservoir sands.
According to the latest release from the company the Ocean Guardian drilling rig is heading for the Sea Lion location while it awaits the necessary consent from the Falkland Islands government to carry out the a flow test at the well 14/10-2
The flow test is expected to give an early indication of the production potential which will be an essential part of the planning process required as the Company moves towards its full appraisal and possible development programs.
The design for the initial flow test uses equipment that is available on the Ocean Guardian and certain chemicals which are expected to mitigate the wax appearance temperature and the pour point of the oil
Meanwhile Rockhopper’s second well 26/6-1 at the Ernest location has been safely plugged and abandoned as a dry hole following completion of all logging runs.
The company is expected to provide an update of its operations once the Ocean Guardian is at the Sea Lion location.
The oil well at the Sea Lion prospect was drilling during April and May 2010, the result of which is the first oil discovery and Contingent Oil Resource in the North Falkland Basin.
Rockhopper was established in 2004 and was floated on AIM in August 2005 and holds a 100 per cent. interest in four offshore production licences granted by the Falkland Islands government.
Before the drilling begun early this year the company was involved in an extensive work program which included 2D and 3D Seismic and Controlled Source Electromagnetic Mapping (CSEM).
In February 2010, the Ocean Guardian drilling rig contracted by Desire Petroleum arrived in Falklands’ waters to carry out the current multi-wall drilling campaign.
The Ocean Guardian first drilled the Liz prospect well for Desire Petroleum, discovering natural gas; the Sea Lion well for Rockhopper, discovering oil; and the Toroa well for Falklands Oil & Gas, which was a dry hole. However it was the first well to be ever drilled to the south of the Falklands. The Ernest well was also dry.
FOGL junior partner (49%) of Australian mining giant BHP Billiton (51%) has plans to continue with its original exploratory program to the south of the Islands, probably with a deeper water submersible rig. Two more companies, Borders & Southern Petroleum (in May) and Argos Resources (early July) have announced their intentions of drilling in Falklands’ waters.