Oil & Gas Round-Up: 2010 - The Falkland Islands
31 December 2010
Far too much has been said here and elsewhere about the Falkland Islands this year, and it will no doubt be more of the same next year.
Falkland Oil and Gas (FOGL) had a dry hole at its Toroa prospect, the first and currently only well to the east of the Falkland Islands. No sign of a rig for further drilling yet, and its joint venture partner BHP Billiton has since decided not to continue to the second exploration phase on the southern licences. Falkland Oil and Gas is keeping the faith and assumed 100% and operatorship of the southern licences.
Borders and Southern (BOR) has signed up a rig to drill two of its prospects in the south, in late 2011.
In the North Falkland Basin, Desire Petroleum (DES) declared Liz a gas discovery, but it needs further analysis, Rachel and Rachel North were unsuccessful, although Rachel North was initially declared an oil discovery and then was found to be water wet on test a few days later. Desire Petroleum is now pinning its hopes on the Dawn/Jacinta well, however the latest news is that the Jacinta target is dry and Desire is drilling on to Dawn. After that, its more 3D seismic acquisition.
Rockhopper Exploration (RKH) recorded a dry hole at Ernest and discovered and flow tested oil at its Sea Lion prospect. An appraisal well and a further exploration well outside the Sea Lion Discovery Area are next up on the agenda as well as 3D seismic acquisition programmes on its own account and jointly with Desire and Argos. Rockhopper is also hoping to tie down a deal to keep the Ocean Guardian drilling rig in the Falkland Islands for further drilling after the current contract ends.
Argos Resources (ARG) arrived late to the party when its shares started trading on AIM in late July alongside a £22 million fundraising at 31 pence per share. Argos will use the funds to undertake 3D seismic acquisition over its acreage. Argos has also held out the possibility of a well in late 2011.
Share prices of the Falkland Island exploration companies are heavily influenced by punter passion and can rightly be described as a rollercoaster ride:
Rockhopper Exploration shares started 2010 at 50 pence, reached the dizzy heights of 500 pence and has ended it on 367 pence.
Desire Petroleum started at 90 pence, dropped as low as 40 pence, climbed back up to nudge 170 pence and following its latest bad news is exiting the year around 48 pence.
Falkland Oil and Gas opened the year at 130 pence per share, reached 245 pence in anticipation of a positive well result, crashed to 95 pence on the dry hole and is currently just above 100 pence.
Even Borders & Southern which hasn't yet drilled a well in the Falklands, is ending the year pretty much where it started, about 63 pence per share, however that ignores the drop to 45 pence, the jump up to 92 pence and the subsequent slide back to 63 pence.
Argos Resources has done a bit better, from a starting point in July of 31 pence, the share price touched 70 pence and has since dropped back to finish the year on 44 pence.
Who knows where these companies shares price will be this time next year, but unless it has more than one oil discovery to its account, the Falkland Islands could be competing with offshore Namibia for the passionate punters money.
www.smallcapnews.co.uk/article/...as_RoundUp_2010_The_Falkland
