Desire Petroleum

<>Desire Petroleum plc (Desire) is a UK company listed on the Alternative Investment Market (AIM) dedicated to exploring for oil and gas in the North Falkland Basin.

Desire has recently completed a 6 well exploration programme. The Liz well encountered dry gas and gas condensate at 2 separate levels while other wells recorded shows.
Together with the Rockhopper Exploration Sea Lion oil discovery in the licence to the north, these wells have provided significant encouragement for the potential of the North Falkland Basin. The oil at Sea Lion is of particular interest as this has demonstrated that oil is trapped in potentially significant quantities in a fan sandstone on the east flank of the basin. It is believed that over 50% of this east flank play fairway is on Desire operated acreage.

Desire has now completed new 3D seismic acquisition which provides coverage over the east flank play, Ann, Pam and Helen prospects. The results from fast-track processing of priority areas are provided in the 2011 CPR. A farm-out to Rockhopper has been announced. The revised equities are shown on the licence map (subject to regulatory approval and completion of the farm-in well). Desire Petroleum

Rockhopper Exploration

British Geological Survey

Argos Resources



Latest Press Realeses from Desire

Charts are very weak Eddie.Strong resistance building at 40p. i am no longer invested in DES.I shall return after the summer when imho interest should start to build start. Or if the SP gets down to silly levels.

I have to concur with eddie and momentum that there is strong risk of DES continuing to edge lower (although overnight recovery in DOW may offer respite).

If this market does continues to drift lower, I see longer-term downside risk to 30.5p (fibonacci retracement) and then I have a projected target at 26.5p. Potentially we could see the 21.5/20.5 area tested (former low and head and shoulders reversal objective). Once the current 'corrective' decline is completed however, the longer term bull-run will resume towards 180.5p initially.
41.5p is the first significant resistance that we need to breach (top of the breakaway gap). A return above there and then 48p would suggest to me that the corrective phase is over.

Desire petroleum gets a mention in 'The Shares Magazine' today as one of 'Favourite Five Small Shares' ....

Unbelievable price today but I've run out of money to buy anymore.Thanks to fugger on ADVFN there is news out that EnCana have sold their Gulf of Mexico assetts (500 m barrels net) to Statoil for $2billion. So they find some oil in the Atlantic, develop the field a bit then sell it for $2billion. So now they have first class experience in offshore drilling and $2billion in the bank to find/develop a new offshore field. I wonder where that might be?

Hi all

Thanks momentum lynnzal & lukyswimmer.

The markets still looking a bit shakey (must be the election). I can see the fibonacci retracements at about 0.3000p. This also has the first rising window dated 09/11/04. This was when the news was released about the 3D survey. This should be as good a place as any for support. The open 0.3550p, high 0.3575p, low 0.3300p, close 0.3450p, combined volume 1.237m.





Good Luck All

Eddie

Morning all,

Cheers for the charts Eddie,Lucky will you be going to the AGM ?



http://www.vheadline.com/readnews.asp?id=32172

Published: Thursday, April 28, 2005
Bylined to: Malcolm Donald


US confrontation with South America over oil can only end in military defeat

Date: Wed, 27 Apr 2005 11:13:18 +0100 (BST)
From: Malcolm Donald donald7063@yahoo.co.uk
To: Editor@VHeadline.com
Subject: Energy Crisis What Energy Crisis

I have read with interest the article published in VHeadline under the headline "Europeans may not support unnecessary US confrontation with Venezuela."

What has been overlooked and what has to be taken into account with regard the available world wide oil reserves is the oil which lays under the sea bed off the coast of Argentina in the Malvinas (Falklands) Basin.

Readers may well remember asking themselves ... 'why would the United Kingdom want to mount a naval armada and send its armed forces to regain those small Malvinas Islands in the South Atlantic that were being claimed as sovereign territory by the government of Argentina.' After all the Malvinas (Falklands) had been a mere South Atlantic UK bunkering station that has fallen into disrepair and the local inhabitants only means of subsistence was rearing sheep.

The answer of course is oil.

There is more oil under the Malvinas (Falklands) Basin than there is in the whole of the Middle East and Venezuela combined.

The only problem is that the majority of this oil lies at a depth under the seabed that makes it currently uneconomic to extract.
The way I see the battle for energy panning out over the next decade is that the US will come to its geopolitical senses having seen the muscle that a China/Russia/India/South American Alliance can provide.

In the aftermath of the US defeat/withdrawal from Iraq the message from the above Alliance of nations will be that a CIA inspired US confrontation with South America over oil can only end in the greatest of US military defeats.

For Russia provides this new alliance with the supersonic low flying OYNX anti-ship missile capable of wiping out the largest US nuclear powered aircraft carriers. Therefore a US military takeover of the Falklands Basin, a practical 100% naval operation, becomes a strategic non event.

While Russia has its own vast oil reserves that can be denied to the West it has at the same time developed this weapon, that India now produces under contract. It is available to nations such as Brazil and Venezuela, and who knows, even Argentina and the remaining democratically elected peoples governments of South America.

Geopolitically, I would say that the Malvinas (Falklands) Islands together with the Malvinas (Falklands) Basin oil reserves are the property of the South American continent and as such should be developed by South America.

No doubt President Chavez has this in mind as he garners support on a world-wide basis for his Bolivarian inspired Peoples Democratic Union of the South American continent.

If China, Russia and India have signed up to agreements to develop the Venezuelan oil economy then it is surely logical to assume that their main strategic goal will be the development of the entire South American continental oil reserves that include those of the Malvinas Basin.

The UK government does not have the military muscle to take on Argentina, yet alone the above alliance to retain the Malvinas. It will have to side under the European Union banner.

Naturally the EU is aware of this looming geopolitical confrontation and is sitting on the fence. It will be interesting to see who the European based oil development companies lobby for!

morning markymar, eddieshare and fellow Desire enthusiastes. If I can afford the bus fare then yes, I hope to got to the AGM on the 24th. The reason for Desire's weakness seems to be twofold, a general weakness in the oil sector at the moment with analysts wondering if a $50 per barrel price can be sustained (they need to read M.Simmons). Secondly an irritated Argentina raising the issue of the Falklands again with the EU.

Just waiting for some news (rig contract, more block purchases nearby or more farm-in arrangements) to restart the bull run and stop luckyswimmer drowning in the South Atlantic.

Cheers Lucky i think 90% of us are drowning with you. Its painful to see my losses and ming was down 42,000 but we no DES well and no she can soon get back up to pre highs very easy.


Desire is in the best shape ever.

http://www.desireplc.co.uk/pdfs/annualreport04.pdf

1 hole for 2 targets, a double gusher hopefully.

http://www.desireplc.co.uk/pdfs/annualreport04.pdf

Well Capt it looks like as said before kill 2 birds with one stone and if they hit oil on the first drill it will put between 7 to 12 on share price.

They have done there homework on this and are no micky mouse out fit and very happy where my money is tonight.

I think when people wake up to how big this could be from a downer on the roller coaster we are going to be flying soon.

A very happy Marky

Any thought out there lads?Lucky?

Eddie... heee hold tight mate them girls will have a good head start.

Markymar, some thoughts. it seems that the technical review in the Annual Report may indicate the first 3 prospects they intend to drill

1) Liz and Beth, two prospects with one drill, combined oil in place potential of 3billion (of course not all will be recoverable but who cares if you start with 3billion), this is so big I assume if the first drill is successful Desire will test the extent of them with the other two drills.

2) Anna which again has two prospects at different depths which can be tested with one drill

3) Rachel which completes a hatrick of drills with two targets.

I am starting to feel more comfortable about a mere 3 drill program if we are actually going to investigate 6 targets in the process.

Still managing to find a few gulps of air in the South Atlantic, luckyswimmer

http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2005/04/30/warg30.xml&sSheet=/news/2005/04/30/ixworld.html


Argentina protests at Falklands link to EU
By Seamus Mirodan in Buenos Aires
(Filed: 30/04/2005)

Argentina has voiced outrage at the inclusion of the Falkland Islands as British territory in the draft EU constitution.



"We are perturbed, we reject this thoroughly, but it is not a new issue and we will have to fight about it for years to come," said foreign minister, Rafael Bielsa.

Argentina has complained to Brussels and ordered its ambassadors in the 25 EU capitals to issue protests.

London wants to see the Falklands permanently lodged in an annexe to the EU constitution as part of "British Antarctic Territory".

Argentina fears that what has traditionally been a bilateral dispute would then become continental.

An EU spokesman confirmed there would be no change in the document and officials insisted that the territorial references were the same as in previous treaties, the most recent being the 2000 Nice Treaty.

Argentina has maintained its claim to the islands, which have been under British rule since 1833. They were invaded by Argentina in 1982, and in reply Britain sent a task force to reclaim them. Some 649 Argentine and 255 British troops were killed in the conflict.

Argentina's diplomats have stood before the UN decolonisation committee almost every year since 1948 requesting recognition of its sovereignty over the islands.

Indeed the wish to gain control can only have been strengthened after Desire Petroleum said last week that at least one billion barrels of oil could lie in the North Falklands basin, an area which is attracting increased international interest due to the rising price of world oil.

The EU is currently battling to get the draft constitution approved by member nations, many of whom could reject the document in referendums during the coming months.

The Falklands are named in the draft EU treaty under an "association agreement" for overseas dependencies.

David Bodecott web site has been updated.


http://www.bodecott.com/

Recent Activities: April 30th 2005 update.

FALKLAND ISLANDS EXPLORATION ACTIVITY

We have been involved in all areas of North Falkland exploration with several clients for nine years. Initial drilling results during 1998 were technically, but not commercially successful, i.e. oil was found but not produced.

At a meeting of the Petroleum Exploration Society in Aberdeen not too long ago, one member of the audience proclaimed that oil will not be produced commercially off the Falklands. This was reminiscent of those who in the late 1960s said they would drink every drop of oil produced north of 56 degrees in the North Sea. Both basins have already been proved petroliferous. The North Falkland Basin is in a similar state of evolution as the North sea was in the late 1960s.

The second phase of Falkland Exploration is gathering momentum. We are closely involved with evaluations of all Falkland licence areas through the activities of two clients.

DESIRE PETROLEUM

Desire are now formulating plans for drilling three of their eight or nine prospects in Tranches C and D (licences 3 & 4). Investor interest has been very high for the recent fund-raising.

3d interpretation results confirm attractive seismic amplitudes, DHI's (Direct Hydrocarbon Indicators) and structural-stratigraphic pre-source rock prospects. These prospects are adjacent to a mature source-rock kitchen which contains one of the richest sapropelic (oil-prone) source rocks known in the world. Drilling beneath the Early Cretaceous source rock is analogous to drilling beneath the Kimmeridge Clay source rock of the North Sea insofar as some of the oil reservoirs are located beneath the source rock. The next three wells will test this untested pre-source play.

The area to be drilled has modest water depths which greatly assist the economic potential. Success can not of course be guaranteed with the first well, but it is to be hoped that that at least one of the three wells will prove oil or good shows. There are still more prospects for a further phase of drilling after the initial three wells if encouragement is found.

ROCKHOPPER EXPLORATION

Rockhopper have recently been awarded licences PLO 23 and 24 in the southern part of the North Falkland Basin. These are relatively shallow water (less than 200 metres), commercially attractive areas close to the Falkland Islands. Any exploration success here would be very quick to exploit. There have been no wells drilled in the southern part of the NFB, but both Desire and Rockhopper have substantial prospects and leads within those areas with DHI presence.

The Rockhopper 100 per cent licences 23 & 24 wrap around the Desire licences 6 & 7, and contain a southerly extension of the North Falkland lacustrine Basin where high potential source rocks are expected to be proved. The source rocks are likely to be older than those of the Desire licences 3 & 4. Existing 2d seismic indicates the likelihood of reservoir development.

Any success in the area is likely to increase significantly the value of the Rockhopper acreage. They have further optimised their portfolio by taking an interest in the soon-to-be-drilled Desire licences 3 and 4.

COMPETITOR ACTIVITY

Additional large acreage spreads southeast of the islands have been licensed recently by FOGL and Borders & Southern. These are all high risk frontier areas, having scant previous seismic information, no wells, deep water and a harsh climate. Any potential in this area might be ten or more years down the line from the North Falkland Basin - and with much bigger risks. 2d seismic has recently been acquired.

The main objective reservoir is one that is also present in the North Falkland Basin, but the source rocks are not expected to be the rich lacustrine shales, as a marine section is expected.

Massive recent share price movements suggest that investors are actively embracing the high-risk scenario of the South Falklands deep water areas. This can only have a positive knock-on effect for the North Falkland Graben which is much lower risk and with very similar geology and structure.

A little mention on Desire Petroleum and Peak winning a new contract and some back ground on Peak.All news we are getting at moment is positive and can only be time before the share price reflect this and as the drilling phase get closer the share price will rise.

http://www.thisisnorthscotland.co.uk/displayNode.jsp?nodeId=149235&command=displayContent&sourceNode=149218&contentPK=12312955&moduleName=InternalSearch&keyword=falklands%20oil&formname=sidebarsearch

Hi all

Thanks markymar & luckyswimmer.

Yes DES is getting a bit of press attention at the moment. This can only be a good thing. Peak look prety good. We are looking for support at the third window (gaps between the blue candles on the left side of the charts). The bottom of the window is about 0.3000p this is also roughly where the fibanacci retracement line falls. The rally that took DES to its highs started at about 0.2800p. This would be a good place for DES to head back up. The main US indices looked prety good for Friday, so we may get off to a good start tomorrow. I will post this chart, but I will be away next week at Disney Land Paris. (don't all cheer at once)




Maybe momentum or lynnzal could update the charts.

I will try to look at the BB's

Good Luck All

Eddie

1,250 billion barrels of oil could have been generated over FOGL's patch to the south of the FIs according to their press release today - is that a misprint? Drilling in 2007 should mean that if we Desire holders are successful in six months then we well have plenty of time to switch.

A 600,000 cross this morning, that might hopefully indicate the end of an overhang dragging the share down.

Good news for FOGL and great news for Desire as the eyes of the world will be watching this story as it unfolds in time.

http://www.falkland-malvinas.com/Detalle.asp?NUM=5584

Falklands-Malvinas
Tuesday, 03 May


Gusher dreams push up Falkland Oil and Gas



Exploration minnow Falkland Oil and Gas gushed after seismic reports dramatically increased the prospect of discovering sizeable reserves of oil and gas.The company will have to raise fresh funds to step up the exploration work.



The shares jumped 10p to 119p, having risen from 40p when it floated on AIM last October. The company was spun off from Falkland Islands Holdings, which still has 18%. Other major holders are Australian oil group Global Petroleum, 16%, and AIM-listed UK fund manager RAB Capital with 31%.
An upbeat chief executive John Armstrong said the Falkland Islands could become a new petroleum province by the end of the decade and called the seismic reports remarkable.

He added: This is the most exciting project Ive seen for years the number of leads identified has far exceeded our most optimistic estimates and we believe it has greatly enhanced FOGLs prospects.

The data identified 130 leads - a feature requiring further technical appraisal prior to a decision to drill some of which appear capable of containing recoverable reserves in excess of 200 million barrels. At the time of the float FOGL identified just eight structures worthy of closer scrutiny.

The company now plans to carry out further seismic surveys targeting all the leads, but with emphasis on the 50 most promising. The aim is to develop 20 high quality prospects ready for a drilling programme to begin in 2007.

At the time of its float FOGL held a 77.5% interest in seven offshore production licences covering 33,700 sq km to the south and east of the Falklands. FOGL holds the licences in a joint venture with Hardman Resources. In December it was awarded a 100% licence over a further area giving a total of 83,700 sq km equivalent to 380 North Sea blocks.

Armstrong said the increased scope of the exploration work would require further funding. At the end of March it had 10.9 million cash.

May 3, 2005
by H. E. the Governor Mr. Howard Pearce

Executive Council 28 April 2005
http://www.falklandnews.com/public/story.cfm?get=3227&source=3

On oil, Councillors agreed that in future work plans made by companies as part of their licensing agreement would be made public. This will enable other companies who are interested in applying for a licence see the kind of work which FIG expects them to commit to although obviously each company will have a different work plan.