MercoPress. South Atlantic News Agency

Falklands’ oil industry, Rockhopper plans equity raise for second FPSO

The incorporated asset carries an aggregate cost of US$125 million and will target the so-called central development area, CDA, of the Sea Lion field.

Rockhopper Exploration is planning an equity capital raising to fund its share of a second FPSO, (OSX-1), for the Sea Lion oil field development in the Falkland Islands, since operator Navitas Petroleum exercised its option to acquire the vessel for some US$ 125 million with the purpose of further adding production to 125.000 barrels of oil per day.

According to information from oil and gas industry international agencies, Navitas will initially fund 100% of the OSX-1, while partners determine how she will be incorporated to the increased Sea Lion project. Rockhopper that is a non-operating partner of the development with a 35% share and Sea Lion license-holder, announced that it will require extra funding to acquire its percentage rata interest in the FPSO and other expenditures.

Rockhopper affirmed that “Navitas has provided an update that it has (through a subsidiary) exercised an option to acquire the second FPSO, named the OSX-1, and the completion of the acquisition is expected during the coming month.”

The asset carries an aggregate cost of US$125 million and will target the so-called central development area, CDA, of the Sea Lion field.

Samuel Moody, Chief Executive Officer of Rockhopper, commented: 'Today’s update from Navitas reflects its continued commitment to developing and accelerating Sea Lion, and the consequential significant enhancement of the Project’s value. We are working alongside Navitas to ascertain the optimal structure for Sea Lion’s participation in OSX-1 and are planning a Capital Raising to secure the required financing. We have already received positive indications of support for this financing and we look forward to updating the market in due course as appropriate.'

The first phase of Sea Lion is underway, with drilling work scheduled to start in early 2027 in the so-called northern development area, with first oil expected in 1Q28. Meantime the FPSO vessel Aoka Mizu, with 55,000b/d capacity, is on route to a shipyard in Asia where upgrading work will be carried out. Onshore work is also underway in the Falkland Islands, targeting quay and shore-based components.

Navitas intends to use OSX-1 to accelerate development of the CDA, with 20 wells planned for CDA Phase 1 and another 18 for Phase 2. Partners in the project are targeting an FID for the CDA during the first half of 2028, followed by first production from CDA Phase 1 by the end of 2030.

The accelerated development has also materially increased the estimated economics of Sea Lion.

An updated independent report prepared for Navitas by Netherland, Sewell & Associates, using a long-term Brent assumption of US$ 76 per barrel, indicates Navitas’s discounted project cash flow has increased by approximately 39% compared with its February 2026 assessment.

Rockhopper expects to publish an updated independent assessment for its own 35% interest shortly and believes it is likely to show a similar proportional increase.