Rockhopper and Falkland rally on oil discovery

11th Jan 2016 10:04

(ShareCast News) - Oil and gas exploration and production companies Rockhopper Exploration, Falkland Oil and Gas, and Premier Oil issued statements on Monday confirming the discovery of oil at the Isobel deep well, which is on the edge of neighbouring oilfield Elaine in Falkland Islands waters.Rockhopper, whose 24% working interest in the well will rise to 64% following the completion of its merger with Falkland Oil and Gas, said the Isobel Deep reservoir was successfully re-drilled and the well reached a total depth of 3014m below sea level, some 4km from the discovery well.The well encountered a total of five oil bearing fan packages, with net pay of 27m recorded within the Isobel Deep and Emily reservoirs.Rockhopper added the results indicate the total oil column established by the second well is likely to be over 480m.The company said that while the data acquired still needs to be fully evaluated and integrated, the results suggest the Isobel/Elaine complex is highly likely to contain a commercially viable quantity of recoverable oil.Chief executive officer Samuel Moody said: "Proving oil this far down dip in the Isobel Deep reservoir, in addition to confirming oil bearing sands at a location so close to the edge of the various other fan bodies, is an outstanding result and hugely increases the likelihood that the Isobel/Elaine complex can become a third phase of development in the North Falkland Basin."Falkland Oil and Gas's CEO Tim Bushell said the outcome was "considerably beyond" the company's initial pre-drill expectations."The merger with Rockhopper is now the natural next step for the company and should see the realisation of shareholder value via the progression of Sea Lion to first oil, the development of surrounding oil discoveries including Isobel/Elaine and further exploration of a number of material untested prospects," he added.Premier Oil owns the remaining 36% interest in the well.At 1026 GMT, Rockhopper shares were up 15.5% to 28p, Falkland shares were 11% higher to 8.10p and Premier was down 0.5% to 29.84p.