Falklands : Hydrocarbons Daily Record (06/06/2006)
Submitted by Falkland Islands News Network (Juanita Brock) 07.06.2006 (Article Archived on 21.06.2006)

Rockhopper Exploration's Press Release is attached.

HYDROCARBONS DAILY RECORD: MONDAY, 05 JUNE 2006

By J. Brock (FINN)

At 1800 LMT on Tuesday, 06 June 2006 Light Sweet Crude fell 10 cents to $72.50 per barrel on the New York Mercantile Exchange and Brent Crude was at $70.81 barrel, down 56 cents on London’s ICE Futures Exchange. 

Readers note the Rockhopper press release at the bottom of the report.

TRENDS:

There is optimism today ad Iran is considering the proposals and sanctions document given to them by EU International Foreign Policy Chief, Javier Solana. This reflected in a drop in the oil price.  It is thought unlikely that Iran would disrupt shipping in the Gulf of Oman as an Iranian Muslim Mullah had threatened.

THE MARKETS:

FTSE100

The selling spilled over into the Far East today, Tokyo stocks slumping almost 2% while Hong Kong's Hang Seng index also suffered losses. It was inevitable London would open lower although selling pressure was contained. The FTSE 100 index fell 92.3 to 5669.8 while the FTSE 250 index tumbled 276.7 at 9075.2.

DOW JONES AND NASDAQ:

Statements by the Federal Reserve Bank Chairman indicated that the board would make an effort to curb inflation.  This means that it may be planning to increase interest rates.  This had a direct affect on stock prices today and stocks were sold.  The market hasn’t been this low since 09 March 2006.

The Dow Jones Index dropped 0.42% and settled at 11,002.14, with the NASDAQ falling 0.32% and settling at 2,162.78.

DEVELOPING FACTORS

(Iran)

The delivery of a package of measures aimed at either providing benefits or sanctions for Iran finally arrived today.  Iran is studying the proposals that, as yet, have not been disclosed in full to the general public.  It is thought that the benefits would be: a light water nuclear reactor and a supply of fuel, the ability to buy spare airplane parts from Boeing for Iran’s ageing airline, a lift of the ban to import agricultural technology and support from the US and the EU for Iran to join the World Trade Organisation.  It is thought that the penalties would include a continued arms embargo, the suspensions of visas for travel, and a freeze of assets overseas.

(Falkland Islands)

Falklands Oil Stocks End of Day Price for the 6.06.06

Desire Petroleum down 3p or 7.7% on the day to stand at 36.p

Falklands Oil and Gas down 3.5p or 2.7% on the day to stand at £1.26.50p

Rockhopper Exploration up on the day 1p or 3.5% to end the day at 29.5p

Border and Southern unchanged on the day to stand at 44p

PRESS RELEASE

For immediate release: 6 June, 2006

Rockhopper Exploration plc

Preliminary Results for the Year ended 31 March 2006

Rockhopper Exploration plc (“Rockhopper” or “the Company”), the oil and gas exploration company focussed on the North Falkland Basin, which listed on AIM in August 2005, has today announced its preliminary results for the year ended 31 March 2006.

Highlights:

− Successful placing and listing on AIM

− 2D seismic survey completed

− Electromagnetic surveys completed

− 3D seismic survey commissioned

− Cash at bank 31 March 2006 of £12.5 million

− Pre tax loss of £0.354 million

Executive Chairman, Dr. Pierre Jungels commented:

“We completed a successful listing on AIM in August 2005 raising £15 million before expenses to undertake work on all of our licence areas.

A 2D programme has been completed on licences PL023 and PL024 and a 3D vessel is now secured for licences PL032 and PL033. CGG, one of the world’s leading marine seismic contractors, will undertake the survey.

We have also completed two Controlled Source Electromagnetic surveys in order to give ourselves greater confidence in the prospects over which they were acquired. These are the first such surveys ever completed in the Falkland Islands, the results of which will be fully integrated with all our other technical studies once they are available.

We remain positive about the prospectivity of the basin as a whole and our acreage specifically.”

For further information, please contact:

Rockhopper Exploration plc www.rockhopperexploration.co.uk

Sam Moody, Managing Director 01722 414 419

Peter Dixon-Clarke, Finance Director

Aquila Financial Limited www.aquila-financial.com

Peter Reilly 020 7202 2601

Yvonne Fraser 020 7202 2609

Rockhopper Exploration was established in early 2004 to explore for oil in the North Falkland Basin. We currently have a 100% working interest in and are the Operator of 4 licences, PL023, PL024, PL032 and PL033, which between them cover approximately 5,800 km². In addition, we have a 7.5% working interest in licences PL003 and PL004, which are operated by Desire Petroleum. In total, our net acreage position of over 5,900 km² currently makes us the largest acreage holder in the North Falkland Basin.

are currently in a period of relatively high oil prices and have seen a significant growth in exploration activity across the world. Access to high quality acreage is becoming increasingly difficult and expensive while high quality people and equipment are in high demand and short supply. Against this background, your board has built up an acreage position of real prospectivity and value and has also been able to carry out a significant part of the work programme set out at the time of our listing on the Alternative Investment Market (AIM), with more work already timetabled for later this year.

Achievements

We completed a successful listing on AIM in August 2005 raising £15 million before expenses to undertake work on all of our licence areas. We specified at the time that we would conduct both 2D and 3D seismic acquisition programmes and consider using other exploration technologies in addition to fulfilling our commitment to drilling with Desire Petroleum.

The 2D programme has been completed on licences PL023 and PL024 and the 3D vessel is now secured for licences PL032 and PL033. CGG, one of the world’s leading marine seismic contractors, will undertake the survey. We have also completed two Controlled Source Electromagnetic (CSEM) surveys in order to give ourselves greater confidence in the prospects over which they were acquired. These are the first such surveys ever completed in the Falkland Islands. The results of these surveys will be fully integrated with all our other technical studies once they are available.

We are working closely with Desire in moving towards drilling on licences PL003 and PL004 but have experienced a significant tightening in the worldwide market for drilling units.

Outlook

Once the results of the two CSEM surveys have been fully integrated into the seismic studies, our knowledge of the southern, undrilled part of the North Falkland Basin will be taken to a new level.

Processing the new 920km 2D seismic survey data is nearing completion. Once we have the processed data, we will focus on interpreting and integrating it into our existing knowledge of the area.

The next active step in our exploration will be the collection of the new 3D seismic survey in licences PL032 and PL033. Once the data has been acquired, processing and interpretation will carry the work programme into 2007. The ultimate test of any exploration is, of course, drilling. To this end, not only do we have the 7.5% interest in PL003 and PL004, but we are working on our own 100% acreage with modern seismic techniques and CSEM in order to reduce risk before committing to a drilling programme. It is our intention to co-operate as fully as possible with other operators in the region in order to reduce costs and maximise not only knowledge and experience, but also the chance of success.

We have achieved a great deal in this first year against a background of increasingly difficult markets for services in the oil sector. We look forward to being able to present the full results of our new 2D and CSEM programmes later this year and the results of our significant 3D programme during 2007. At that point, we will need to consider our funding options should we confirm the presence of drillable targets in our acreage.

Summary

We remain positive about the prospectivity of the basin as a whole and of our acreage specifically. We believe a number of completely untested plays remain in the basin which give a better chance of success than the original drilling campaign in 1998. The technical work is progressing as anticipated at the time of the listing and the board as a whole remains strongly supportive of the management team as we move closer to discovering the real potential of the basin.

Dr Pierre Jungels CBE

Executive Chairman

5 June 2006

NB: This statement has been approved by the Company’s geological staff who include Keith Williams (Exploration Director), who is a Member of The European Association of Geoscientists & Engineers (EAGE) with over 30 years of experience in petroleum exploration and management, for the purpose of the Guidance Note for Mining, Oil and Gas Companies issued by the London Stock Exchange in respect of AIM companies, which outline standards of disclosure for mineral projects.

Rockhopper Exploration plc

Group profit and loss account

for the year ended 31 March 2006

The operating loss for the year/period arises from the group’s continuing operations. No separate Statement of Total Recognised Gains and Losses has been presented as all such gains and losses have been dealt with in the Profit and Loss Account.

Rockhopper Exploration plc

Group balance sheet

31 March 2006