Falklands : Falkland Oil and Gas: The Story Thus Far
Submitted by Falkland Islands News Network (Juanita Brock) 29.09.2005 (Article Archived on 13.10.2005)
FOGL, thanks to the Falkland Islands Company, now have a Stanley Office..
FALKLAND OIL AND GAS: THE STORY THUS FAR
By J. Brock (FINN)
The size of FOGL's Acreage can be compared to a similar sized area in the Gulf States of the United States.
Mr. John Armstrong and Mr. Patrick Bird from Falkland Oil and Gas are presently visiting the Falklands and based in the Crozier Place Offices at the Falkland Islands Company. They gave a presentation to the Chamber of Commerce on Monday night, which will be the subject of a further story on the FINN(COM) Daily Record. However, as an introduction to that, a brief history of the story thus far is in order.
At the time of exploration in the North Falkland Basin in the late ‘90s, the South Falkland Basin was thought to be too deep for drilling but technology has improved and Falkland Oil and Gas have taken up the gauntlet, licensed acreage and done a 2D seismic survey. Now that over 130 areas of interest have been discovered, further 3 D seismic surveys will be carried out on those areas.
It’s an interesting challenge to name one Jurassic/Cretaceous/Tertiary sedimentary basin in the world that does not contain at least some commercial oil and gas. The real issue is whether the resource is tapped in large enough accumulations and held in sufficiently productive reservoirs to provide viable commercial reserves.
Falkland Oil and Gas Limited, (FOGL) was formed in May 2004 to invest in an offshore oil exploration programme south and east of the Falkland Islands. It was admitted to the London Stock Exchange’s Alternative Investment Market (AIM) in May 2004 raising £12Million. At the time, FOGL held a 77.5% interest over a 33,300 sq km area. Hardman Resources Limited holds the remaining 22.5% interest in these licences. In December 2004, the Company was awarded 100% interests over an additional 50,000 sq km adjacent to its existing licence areas. Later that year, FOGL commenced a 2 D seismic survey, which identified the previously mentioned 130 leads, far in excess of the 8 leads identified at the time of the IPO. Furthermore, the survey has suggested that some of the numerous possible drill targets could be of significant size.
FOGL plans to conduct further seismic surveys targeting all the leads but with particular emphasis on 50 of the most promising, with the aim of developing 20 high quality, technically sound and potentially economically viable drilling prospects. FOGL will then process an aggressive and focused exploration programme through the current 2 D seismic survey, possibly followed by 3 D seismic survey. The Company then intends to develop a multi well drilling programme aimed to begin in 2007.
As one of the worlds few un-drilled sedimentary basins, the extent and depth of the South Falkland Basin suggests that if it exists, the hydrocarbon resource would be of a major scale. Analysts have concluded, based primarily on a top-down view on the scale of the basin as interpreted from seismic, that the size of the prize in terms of future potential for oil discovery could be in the range of 8 and 24 billion barrels in FOGL’s licence area.
While the inherent risks in FOGL at this stage clearly remain high, the exploration story has advanced considerably since flotation with a significant increase in acreage under licence and highly encouraging signs from seismic.
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