Falkland Oil and Gas - 2012 - its over for now

Sunday, Jan 01 2012 by
11

 

Falkland Oil and Gas Limited

EPIC : FOGL

 Shares in Issue : 320 million

Web Site : http://www.fogl.com/fogl/en/home

 


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Falkland oil and Gas Limited (FOGL) is an oil and gas exploration company operating in the South and East Falkland Basins. The Company’s operations are focused on oil and gas exploration activities in the Falkland Islands. The principal subsidiary of the Company is FOGL Finance Limited, which is 100% owned by the Company. FOGL owns and is the operator of 100% of its license areas. The Falkland Islands comprise some 340 islands, located approximately 480 kilometer from the nearest point in South America. On March 20, 2012, FOGL announced that it had granted an option to enter into a Farm-Out Agreement to an oil industry counterparty. more »

Share Price (AIM)
28.08p
Change
0.0  0.0%
P/E (fwd)
n/a
Yield (fwd)
n/a
Mkt Cap (£m)
149.4

Borders & Southern Petroleum plc is an oil and gas exploration company. The Company’s area of activity is in the Falkland Islands. The Company has a 100% interest and operatorship in three production licenses covering an area of nearly 10,000 square kilometers. The acreage is located approximately 150 kilometers south-east of the Islands. The Falkland Islands are located in the South Atlantic, approximately 500 kilometers from the mainland of South America. The Company holds a prospect inventory, which includes reservoir targets in the Tertiary, Late Cretaceous and Early Cretaceous. more »

Share Price (AIM)
7.73p
Change
0.0  0.0%
P/E (fwd)
n/a
Yield (fwd)
n/a
Mkt Cap (£m)
38.8

Rockhopper Exploration plc (RKH) is engaged in exploration and exploitation of its oil and gas acreage. RKH has discovered oil in the Falkland Islands. Its Licences include Licences PL023 & PL024, which represents the southern acreage that it holds within the North Falkland Basin and RKH holds these licences 100% and is the operator; Licences PL032 & PL033, which represents the northern acreage that the group holds within the North Falkland Basin and holds these licences 100% and is the operator, and Licences PL003 & PL004. The Company has a 7.5% working interest in licences PL004a and PL003 and is not the operator. The Company also holds a 25% working interest in licence PL004c. In August 2014, acquisition of Mediterranean Oil & Gas Plc by RKH has completed. more »

Share Price (AIM)
70.93p
Change
-2.0  -2.8%
P/E (fwd)
n/a
Yield (fwd)
n/a
Mkt Cap (£m)
211.9



  Is Falkland Oil and Gas fundamentally strong or weak? Find out More »


212 Posts on this Thread show/hide all

Proselenes 18th Apr '12 76 of 212
1

Good moves today, strong rumours of BOR striking oil at Darwin.

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Proselenes 19th Apr '12 77 of 212

http://www.thesun.co.uk/sol/homepage/news/money/article4265337.ece

Falklands phwoar

HOPES of more black gold being discovered off the Falklands sent shares in an oil minnow soaring 55 per cent last night.

BORDERS & SOUTHERN was forced to play down talk it had made a strike south of the islands — as excited investors piled in.

But a spokesman refused to rule out success at the company’s “Darwin” field. Sources in the Falklands claimed the company HAD made a bumper discovery but was currently evaluating its size and scale.

A crew change on Borders’ rig two days ago is thought to have seen workers returning to Port Stanley fuelling rumours that have been fizzing around the internet.

One analyst conceded amid the confusion: “I guess it’s just speculation as to a positive result.” Borders’ share price soared 38.50p to 108. FALKLANDS OIL & GAS, which has interests close to the Borders field, climbed 24.25p to 93........................

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Proselenes 20th Apr '12 78 of 212

Nice write up, looks like the USA might be ready to start to do something about CFK....

http://www.washingtonpost.com/opinions/argentinas-president-rejects-stepping-into-the-future/2012/04/19/gIQABtB9TT_story.html


Would be excellent if Chile was put in, in place of Argentina. Chile has always been very supportive of the UK and helpful with all things logistical in the Falklands area.

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Proselenes 22nd Apr '12 79 of 212

http://www.thesun.co.uk/sol/homepage/news/politics/4271600/British-oil-strike-off-the-Falkland-Islands.html

Brit oil strike

EXCLUSIVE
By DAVID WILLETTS

Published: 34 minutes ago

A HUGE oil discovery has been made in the Falklands, sources claimed last night.

The find, by a British-backed company, could contain up to a BILLION barrels of “black gold” an insider revealed.

The strike, off the Falklands’ southern coast, was made by oil explorer Borders and Southern.

It has been tight-lipped about the discovery — but shares have soared on growing rumours. Borders was unavailable for comment last night but Foreign Office officials refused to deny the news.

The latest find follows a..................................... .

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Proselenes 22nd Apr '12 81 of 212
2

Link to updated "2 reservoirs" Sun report.

http://www.thesun.co.uk/sol/homepage/news/politics/article4271600.ece

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Proselenes 22nd Apr '12 82 of 212

A reminder of what Darwin success means for lookalike FOGL targets.........

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Proselenes 23rd Apr '12 84 of 212
1

From Merchant Securities, and I agree very much with the last part ref-FOGL


Borders & Southern Petroleum (BOR.L) Oil & Gas
UNDER REVIEW

Darwin well makes gas condensate discovery

Borders & Southern announced a “significant gas condensate discovery”. Good hydrocarbon shows were encountered from 4,633m down to 4,810m. Net pay of 67.8m was encountered (above the 55m pre-drill estimate). Average porosity is 22%. The company will be able to comment on the liquid content of the reservoir after fluid samples are analysed.

The question now becomes one of assessing whether the liquid content in the gas will be sufficient for the reservoir to be commercially viable on a liquids-only basis. We are very cautious about arriving too early at a positive conclusion for the commerciality of the condensates. At present, we are reluctant to ascribe value to the gas discovery. We keep an open mind for this eventuality, especially given the excellent quality of the reservoir (high recovery rates) and the liquids rich nature of the gas.

; The presence of condensate confirms that the South Falkland basin is conducive to the generation of liquid hydrocarbons. However, due to the close proximity of the Darwin and Stebbing prospects we believe that the probability of finding gas condensate at Stebbing has increased and the probability of finding black oil has decreased.

The read across for Falkland Oil & Gas is somewhat more positive to the extent that the larger scale prospects of Falkland Oil & Gas would make a liquefied natural gas project more viable. We also note that Falkland Oil & Gas has prospects which are deeper into the area that is conducive to oil generation.

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Proselenes 23rd Apr '12 85 of 212

......I have put the locations on to a map.

As you can see Darwin is mature for gas, Stebbing more so for oil. Loligo and Scotia (FOGL drills) are prime oil window.

http://www.moneyam.com/InvestorsRoom/posts.php?tid=16040&from=384

.....

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Proselenes 24th Apr '12 86 of 212

I put this on the BOR thread - info for here.

As some people seem to struggle to understand what gas condensate is, I have put the following together quickly, apologies for errors in advance - this is just a simple way of giving an idea of what "gas condensate" is.


The most interesting question is what is the bngl/mmscf for the gas condensate ?

The company has said, in effect, this is not a "wet gas" find, they have said this is a "gas condensate" discovery.


"Wet gas" is as it says, its gas with fluids in it. Wet gas can be anything from tea cup of Natural Gas Liquids per MMSCF to around 10 barrels of NGL/MMSCF.

BNGL/MMSCF is Barrels of Natural Gas Liquids / Million SCF of gas.


Now, gas condensate discoveries, as opposed to wet gas discoveries, tend to have a value for bngl/mmscf from 10 barrels of NGL/MMSCF up to around 500 barrels of NGL per MMSCF at which point above 500 its into the realms of "volatile oil" before becoming "black liquid oil" at around 1000 BNGL/MMSCF equivalent values.

So

Up to 10 BNGL/MMSCF is "wet gas"
>10 BNGL/MMSCF up to 500 BNGL/MMSCF is "gas condensate".
>500 BGNL/MMSCF up to 1000 BNGL/MMSCF is "volatile oil".
>1000 BNGL/MMSCF equivalent is liquid black oil


To put that into perspective - if lets say the Darwin East + Darwin West structure is joined and has 5 Tcf of gas equivalent value and that "Gas Condensate" has a BNGL/MMSCF value of 100.

You would get :

5,000,000 MMSCF x 100 BNGL = 500 million barrels of condensate.

If its 2 Tcf and 200 BNGL = 400 million barrels of condensate.

If its 2 Tcf and 20 BNGL = 40 million barrels of condensate.


This is why at the moment its very hard to value this "gas condensate" discovery, but its certainly not a "wet gas" discovery as per RNS is clear, this is into the realms of gas condensate.

We await the fluid samples and therefore a value for the BNGL/MMSCF of the fluid recovered from Darwin.

If they recovered fluid from the reservoir it is possible this is actually in the borderline between gas condensate and volatile oil - if the BNGL/MMSCF were to be 500 then it would be fluid like, on the borderline state between condensate and volatile oil.

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Proselenes 24th Apr '12 87 of 212
1

Stebbing is green area so more likely oil, as are Loligo and Scotia for FOGL - BUT the area where Darwin was drilled is distinctly in the small red area there - gas.

captureot.gif

capture1r.gif


As you can see Darwin is prime for gas (red area). Stebbing is more likely to be oil (green area)

Loligo and Scotia targets for FOGL are in the oil window (green) - much more likely to be oil

targets.png

.

Here is all the explo blocks.

capture3.gif

.....

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jseth123 24th Apr '12 88 of 212
4

Pro, unless you are making these images you should really be crediting them to their source IMO.

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Proselenes 25th Apr '12 89 of 212

http://www.oilvoice.com/n/FoxDavies_Daily_Monitor_Borders_and_Southern_Falkland_Oil_and_Gas_and_Aurelian_Oil_Gas/73e9a27378df.aspx



FoxDavies Daily Monitor - Borders and Southern, Falkland Oil and Gas and Aurelian Oil & Gas

..........................

Falklands Oil and Gas (FOGL LN, 91.25p, 2.7%) - Concept Proven:

Today's BOR LN results will boost south Falkland's players, such as FOGL as it diminishes one of the key risks associated with the SFB- that it is a viable hydrocarbon basin with mature source rock. With this news, we are raising our target price from 250p to 275p and reiterating our BUY recommendation.

Falklands - That Thick Silver Lining Still has a Cloud…: Today's news that there is a viable hydrocarbon province in the shape of the SFB benefits everybody, not just the players in that basin, but those in the North Falkland's Basin like Desire, Rockhopper and Argos. With the prospects of the SFB being a viable commercial discovery, there will soon be a claim to have critical mass, and the risks associated with the development of the regional as a whole will lift all the players in the region.

It will also raise the tempo in the fight for the Falklands between Argentina and the UK, which given the recent nationalisation of YPF was a shameless populist driven event, there will be little holding the government back from whipping up another fervour over the Falklands.

But here is the rub. YPF's nationalisation (the "Nationalisation") actually helps the Falklands. Prior to the Nationalisation, Argentina had been indulged in its claims for the Falklands by its LatAm peers, even in the wake of PetroBras' licence revocation, despite what we have been led to believe was its compliance with the terms of the licence. However, the Nationalisation has attracted international condemnation, such that Argentina's next "cab of the rank," i.e. the Falklands, shall be used to make an example of it, which is good for the Falklands.

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Proselenes 25th Apr '12 90 of 212

http://www.investorschronicle.co.uk/2012/04/25/shares/news-and-analysis/more-ups-and-downs-in-the-falklands-0BO47mn8rdI6GH3cpGbElM/article.html



.......IC VIEW:

The initial results from Darwin do at least confirm the presence of hydrocarbon-bearing structures within the South Falklands Basin, which provides a positive beat for UK explorers in the region - including our preferred southern basin play, Falkland Oil & Gas . And, ironically, the recent appropriation of Repsol’s stake in YPF by the Argentine government could perversely make it easier to attract farm-in partners to the South Atlantic, as oil and gas companies - or at least western ones - may now be less bothered about upsetting Buenos Aires on matters of regional sovereignty........

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Proselenes 25th Apr '12 91 of 212

Looking back at 2 media articles has me thinking this "unamed" farm in partner is in fact Anadarko.


Firstly, this from January :

http://en.mercopress.com/2012/01/17

..................Falkland Oil and Gas (FOGL), another British oil explorer, said Friday that it was in talks with parties about taking a stake in its interests in the area.

However, Chief Executive Tim Bushell said any company, such as BP or Spain's Repsol, who have Argentine interests, would most likely not be able to partner with it.

Industry sources said the support of South American oil producers such as Brazil and Venezuela for Argentina's claims on the Malvinas Islands, means companies which have interests in those countries could also shy away from Falklands’ players.

FOGL said it was in talks with North American and European independent oil firms, and analysts said companies such as Anadarko (APC.N), which plans to exit its Brazilian operations and has no Argentine interests, could make a bid..............................


We then move on to FOGL's RNS in March about cannot name the farm in partner yet but option is agreed etc....


But in the background Anadarko are selling their Brazilian assets to Statoil, as reported in March, its getting close, link below :

http://uk.reuters.com/article/2012/03/07/anadarko-statoil-idUKL4E8E70CG20120307


So 2+2=5 and therefore it does look  possible given analyst speculation in January, and ongoing offloading of Brazilian assets, it could be Anadarko and they will farm in to FOGL and RKH as soon as the sale to Statoil is done.

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Proselenes 26th Apr '12 92 of 212

Great news that BOR got their placing away with ease it seems, and at a good price.

http://www.investegate.co.uk/Article.aspx?id=201204260700240965C

There are a number of things to consider here. Firstly that the South Falklands is now going to come into everyones radar as a potential "final massive frontier".

Before the Toroa drill (a 3.7% CoS well) it was not believed by many that thick high quality sandstones were present in the South, as fabled by BOR and FOGL and many geo's. It seemed to good to be true that huge thick sandstones were down there and so there were many billion and multi-billion recoverable size prospects there.

Well, the huge thick sandstones got proven beyond a doubt with Darwin. Tick that box.

The bigger point of the skeptics was that there was no proven working hydrocarbon system there in the south - Toroa a 3.7% CoS well drilled in what would be the edge swampy area helped their case - ignoring the small CoS this well had and it was the only one possible to drill with the shallow water Ocean Guardian rig back then.

Well, the proven hydrocarbon system was proven beyond a doubt with Darwin. Tick that box.

With proven huge sandstone reservoirs with good porosity and with a proven working hydrocarbon system there its easy to see why BOR got the placing done with ease, and its easy to see going forward that those that once dismissed it as all fantasy are now going to appreciate that the South Falklands is potentially an area with many "world class" size prospects there.


The downside of the placing, for some, will be that it highlights the lack of interest in the North Falklands Basin. ARG and DES have been unable to raise funds and yet BOR do so with ease. FOGL has raised money in 2012, but DES and ARG have not seen the interest.

A major thing to consider here is, taking for example Liz and Sea Lion - what you see in the North Falklands is lots of thin stacked sands. If you look into the net pay figure of Sea Lion you will see lots of 1m, 3m, 6m, 2m, 4m, 1m sands that together make the net pay figure, but in reality are lots and lots of thin sands. The problem with that is that it makes development much more expensive, firstly as you have to drill a lot more wells to capture all the thin sands in their best places - so wells to be drilled goes upwards - and secondly it make EOR (Enhanced Oil Recovery) much more difficult - if you can imagine trying to inject each of these thin sands with water and trying not to make them leak into each other and all over the place. Compare that to the South where you have hugely thick sandstone - which makes production drilling very simple and as well as EOR.

RKH should secure their farm out, but I think DES and ARG will have to sit back and just wait until at some time their potential might become attractive - but it could be a long time away - or they have to offer it and cut price levels to get someone else interested.

The world will soon wake up and smell the coffee with regards to the South Falklands Basin potential - and expect BOR and FOGL to become very hot sought after things.
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