Desire runs hot on oil find rumours

27th Oct 2010 08:22

The share price of Falkland Islands oil explorer Desire Petroleum soared on Wednesday morning as rumours swirled around the market that the company had struck oil.The share price, which closed last night at 66.75p, raced ahead to 150p in the middle of the morning, though dealers were at a loss to explain exactly why; a competing rumour to the oil find story was the suggestion of a bid approach, though this rumour appears to have emanated from the not always reliable source of one or more internet message boards. The share price quickly came off the top after spiking at 150p but as at 1:00pm it was still trading at around 100p, a 50% increase on the day.Early in the morning trading session the shares had gently firmed up after the company said it had signed a contract for marine seismic acquisition services with Polarcus for the use of the seismic vessel MV Polarcus Nadia.Desire, wholly focused on the North Falkland Basin, said it is buying a 3D survey over the areas of Tranches C and D not previously covered by 3D, and most of Tranche F to ensure that the east flank fan play fairway, on Desire acreage, has complete coverage. It also wants to acquire 3D data over the northern part of Tranche I and adjacent areas.A contract to process the data will be the subject of a separate invitation to tender, which will be issued shortly. Rockhopper Exploration has also signed an identical contract with Polarcus allowing Desire and Rockhopper to share the vessel for acquiring seismic data in each company's adjacent licences and other areas. The joint survey is expected to begin in December and complete by the end of April. Desire's share of the survey should last around 90 days.