Rockhopper Falklands oil disovery grows

Rockhopper Exploration, the company which found oil off the north coast of the Falkland Islands, has seen its shares soar 9.3% this morning following the announcement of a successful well dig.

Results from the "14/15-4" well suggest that the amount of oil and gas under the cold South Atlantic seas is greater than current estimates.

In its last resource update Rockhopper said it believed its 100% owned "Sea Lion Main Complex" site had 1.297bn barrels of oil in place. This was in addition to its nearby Casper field which was estimated at 90m barrels. Analysts have speculated this may equate to up to 400m barrels of "recoverable" oil.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

Rockhopper believes its discoveries extend into areas owned by another company called Desire Petroleum. 14/15-4 was therefore drilled in Desire's waters with Rockhopper taking a 60% stake in exchange for paying for the drilling.

14/15-4 hit 4 reservoirs, 1 gas (Beverley) and 2 oil (Casper, Sea Lion Main Complex) and one oil and gas (Casper South)

Rockhopper says "all four targets are hydrocarbon bearing and no water wet sands were observed".

Commenting on the result of the dig, Rockhopper's Chief Executive Sam Moody said: "This fantastic result from our most aggressive well of the campaign will further increase our minimum estimates of oil in place for Sea Lion and Casper, in addition to proving two new discoveries in Beverley and Casper South, which is our third oil discovery in the Basin."

BS