UPDATE 1-Desire says report confirms Falklands potential

Fri Nov 23, 2012 1:39pm IST

Stocks

   

LONDON Nov 23 (Reuters) - British oil explorer Desire Petroleum said the findings of a third person report confirmed the potential of its controversial discoveries offshore the Falklands.

The chance of commercial development at its Sea Lion complex in the North Falkland basin was estimated to be 80 percent, the report by energy consultancy Senergy found, although it was a much lower 25 percent for the gas condensate discovery at its Liz complex.

"This competent person's report confirms our view that the Desire licences have excellent remaining exploration potential," Desire's Chairman Stephen Phipps said on Friday.

Oil exploration by British companies in the area has sparked anger in Argentina, which claims sovereignty over the islands it knows as the Malvinas. It has called the drilling there 'illicit' and threatened legal action.

However, while many investors have shrugged off the geopolitical risk, bumping up the company valuations, some analysts have questioned the likely chance of commercial success of the finds, particularly given the high costs of extraction.

Gas condensate, which has also been found offshore the Falklands by Borders & Southern and Falkland Oil & Gas is especially tricky to extract and transport.

Desire said it now had 41 oil prospects and 4 gas prospects, 12 of which had best case prospective resources of over 100 million barrels of stock tank oil.

The company's priority was to attract further investment, Phipps said.

Fellow explorer Rockhopper signed up Premier Oil earlier this year to help it fund the costs of developing its own discovery at Sea Lion.

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

India-WTO Row

REUTERS SHOWCASE

Market Eye

Market Eye

Nifty falls most in nearly 3-1/2 weeks; Sensex down over 400 points  Full Article 

Factory Activity

Factory Activity

Factories post fastest growth for 17 months in July  Full Article 

Paying for Bail

Paying for Bail

Jailed Subrata Roy gets office to negotiate hotel sales.  Full Article 

Rupee Dips

Rupee Dips

Rupee posts biggest weekly loss since record lows in August.  Full Article 

Reviving Infosys

Reviving Infosys

CEO Sikka says to improve business with new growth avenues  Full Article 

Outlook Slashed

Outlook Slashed

ArcelorMittal cuts outlook as ore prices hit mining  Full Article 

Re-gaining Momentum

Re-gaining Momentum

China, Asian factory growth gathers pace; Europe falters  Full Article 

Factory Lockout

Factory Lockout

Pfizer says threats to managers force staff lockout at Mumbai factory .  Full Article 

Gold Smuggling

Gold Smuggling

In cat-and-mouse game, India uncovers new gold smuggling route.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage