Shares in Borders & Southern Petroleum (LON:BOR) nudged up by 4.5% to 66.75p today on news that the Falkland Islands oil and gas explorer was focused on securing a deepwater rig capable of drilling wells on its acreage some time towards late 2010 or early 2011. Reporting full year pre-tax losses broadly flat at £1.2m, the company said it was confident of securing a rig despite competitive market conditions.

Borders raised $184m in a share placing last November in order to cover the costs of a planned two-to-three well drilling campaign. At around the same time, a number of other Falklands-focused oil explorers were raising money on the market ahead of drilling activity. Since then, the group including Rockhopper Exploration (LON:RKH) and Desire Petroleum (LON:DES) have kicked off drilling in the North Falkland Basin that has so far delivered one dry well and one discovery. Borders, whose acreage lies to the south of the islands in a very different geological setting, nevertheless enjoyed a surge in its share price at the end of May on the back of Rockhopper’s discovery. In today’s results, the company once again insisted that the outcomes in the north, both positive and negative have absolutely no impact on the prospectivity of its acreage. It also said that imminent drilling in the south by Falkland Oil & Gas (LON:FOGL) and BHP Billiton (LON:BLT) would involve similar geology but significantly different prospects.

Harry Dobson, the company’s chairman, said: “Our successful capital raise in November allows us to comfortably fund a drilling programme on our exciting prospects in the South Falkland Basin without diluting our 100% ownership of our acreage. We continue to progress our understanding of the prospects with additional technical work but the principal focus is now on drilling - securing a deep water rig and undertaking detailed well engineering studies.”

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