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

Nice article about what is going on offshore.

http://ogj.pennnet.com/Articles/Article_Display.cfm?Section=ARTCL&ARTICLE_ID=253486&VERSION_NUM=2&p=9

Thanks for that Capt good read.

HYDROCARBONS DAILY RECORD (28/04/06)

By J. Brock (FINN)


At 1800hrs LMT on Friday, 28 April 2005 Light Sweet Crude was 91Cents higher to $71.88 and Brent Crude gained $1.11 to $72.02 per barrel. Price rises broke four straight days of decline.



Contributing factors for the rise in prices per barrel include nervousness over Irans reluctance to comply with IAEA requests to co-operate over its nuclear enrichment programme. Irans nuclear enrichment programme for what they class as electric power is again a subject that will be brought up by the U. N. Security Council in due course

The President of the Peoples Republic of China, Mr. Who Jin Tao, has been visiting Kenya and has gained permission to search for hydrocarbons in that country. Also looking for hydrocarbons in Kenya is Global Petroleum. That company is also a partner with Falkland Oil and Gas (FOGL)


FOGL's founder shareholders were The Falklands Islands Company Limited (a subsidiary of Falkland Islands Holdings plc), Dampier Oil Limited (a subsidiary of Global Petroleum Limited) and RAB Special Situations L.P (a fund managed by RAB Capital plc).


Global Petroleum expects to have the deep water vessel, Chikyu, in October to begin drilling off Kenyas eastern coast.

LOCAL IMPLICATIONS:


Good contacts and partnerships should help the exploration efforts in the South Falkland Basin and the North Falkland Basin. FOGLs tranches in the South Falkland Basin would suit a deep water vessel, as the water is a good 100 to 300 metres deeper than it is in the North Falkland Basin. A rig is needed desperately in the North Falkland Basin if we are to find the reserves that the seismic tells us are located under very thick source rock.

There is no firm reported price for Light Sweet Crude or Brent Crude at the time of this writing. Prices will be quoted on Monday.


HYDROCARBONS WEEKEND RECORD (29 AND 30 APRIL 2006)
By J. Brock (FINN)

Reporting on barrel prices for Light Sweet Crude and Brent Crude will continue in Mondays record. At present, there are different prices coming from various sources. When the reporting stabilises the figures will be given.

Contributing factors for per barrel prices include nervousness over Irans reluctance to comply with IAEA recommendations to the UN Security Council and outright defiance of any sanctions that could be placed against that country. Iran claims the nuclear enrichment programme is for power generation and not for military purposes. Another factor is Nigerias 20% cut in production due to recent terrorism near an oil refinery in the city of Werri in the Niger Delta. Though the blast caused minimal damage to the facility, fears are that the rebel group wanting a separate state in the Niger Delta will step up their violence in the area.

A third contributing factor is this weekends summit in Havana of three left leaning governments in Latin America. The resulting trade pact is called the Bolivarian Alternative for the Americas. President Castro of Cuba hosted President Alvo Morales of Bolivia and President Hugo Chavez of Venezuela. Negotiations on several trade subjects moved forward, including some for the hydrocarbons industry. Venezuela will supply Bolivia with oil at below market value prices and Bolivia will supply Venezuela with natural gas that it has in abundance. It is not yet known if this trade deal will affect US and UK oil interests in Latin America but trends will be monitored. President Chavez of Venezuela used the Vince Lombardi philosophy when summing up the summits affects by saying (translated) the best defence is a good offence.

Locally there is little affect on prices as Stanley Services buys fuel at the going rate when supplies run out. Any price fluctuations here will depend on what price the fuel is bought. It is hoped that enough supply can be obtained to wait until bulk fuel prices go down. However, this is thought to be unlikely when crud prices are fluctuating upwards.

HYDROCARBONS DAILY RECORD (01/05/06)

By J. Brock (FINN)


At midday Light Sweet Crude was quoted at $72.28 per barrel with Brent Crude at $73.03. This reflects price rises over the week end. Prices at 1800 LMT reflected a further rise with Light Sweet Crude at $73.70 and Brent Crude at $73.89. The price reductions during four days last weeks have been eaten up by recent events in countries where oil is in production.


Contributing factors include nervousness over a fire at an oil refinery in Italy and a 20% cut in production in Nigeria due to terrorism in the oil-rich Niger Delta.


Reported sabre rattling by the United States over Irans plans to continue with its nuclear fuel enrichment programme also feature in the upwardly fluctuating prices per barrel of Brent Crude and Light Sweet Crude.


Potentially large reserves of oil and gas have been found in Afghanistan that could be the focus of seismic exploration activity in the near future. Given the trend for oil companies to exploit known reserves, it is possible that after all the Afghan data is collected and analysed, there will be a lull in activity.



A bit closer to home, Bolivian President, Alvo Morales has nationalised his countrys gas reserves. Reports say that the military has seized privately owned facilities. Updates will be placed in Tuesday's Hydrocarbons Daily Record.

LOCAL IMPLICATIONS:



Locally Councillors asked U.K. Defence Minister Adam Ingram about security for oil rigs in the North and South Falkland Basins. According to Cllr. Mike Summers, there are marine assets in the area and a risk assessment needs to be done to see what those assets are. He went on to say that it would be up to the MoD to protect the assets.



Councillors pressed upon Mr. Ingram that it was vital for a secure and prosperous Falklands economy to ensure that our assets are protected. It was, they said, in Britains best interests to have a viable economy in the Falklands and to keep the energy supplies safe. The Defence Minister agreed with Councillors and accepted their argument.


Protection of the Falklands Maritime assets lessens the risk factor for exploration and exploitation of hydrocarbons in the North and South Falkland Basins.

http://www.falkland-malvinas.com/Detalle.asp?NUM=7795

Falklands-Malvinas
Tuesday, 02 May


UK Armed Forces minister visits Falklands



Falkland Islands defence capability, the 25th anniversary of the 1982 South Atlantic conflict and hydrocarbons were among the issues discussed Monday between visiting British Armed Forces minister Adam Ingram and elected Councillors in Stanley.


Minister A. Ingram MP
The high profile presence of Minister Ingram, following shortly on the visit of the Chief of General Staff, General Sir Michael Jackson and other military high officials must be seen as a demonstration of the seriousness with which the United Kingdom takes the defence of the Falklands, said Councillor Mike Summers.
The right assets in the right quantities to provide for an adequate defence of the Islands and with no plans for any reductions in these assets, was the message conveyed by the visiting military reports the Falkland Islands local radio station.

Councillors also took up the issue of hydrocarbons and potential security matters if drilling finally begins.

If and when drilling takes place there will be marine assets in the vicinity of the Falklands and a risk assessment would be necessary, indicated Councillor Summers who added that it would be up to the UK Ministry of Defence to provide security for any marine assets.

Councillors in the meeting with Minister Ingram insisted that it is in the strategic interests of the UK to have the Falklands as an economically prosperous country and to have secure energy assets in a more secure part of the world.

Apparently Mr. Ingram accepted the argument.

Finally Councillors also took the opportunity to discuss with Mr Ingram the 25th anniversary of the 1982 Conflict next year. Councillors intend to discuss the issue at the next public meeting.

http://www.oilport.net/news/article.asp?Id=5198

http://www.sartma.com/art_2874.html

MI 5 ed

Executive Council Report for April 2006
May 2, 2006
by H. E. the Governor Mr. Pearce

Removed temporarily by request of the Foreign and Commonwealth Office.

Good news there Caps just need news of a rig.

http://www.mercopress.com/Detalle.asp?NUM=7801

Falklands : Hydrocarbons Daily Record (02/05/06)
Submitted by Falkland Islands News Network (Juanita Brock) 03.05.2006 (Current Article)
Bolivia's take over of foreign investments in their hydrocarbons industry has contributed to the crude oil price rises.


HYDROCARBONS DAILY RECORD (02/05/06)

By J. Brock (FINN)

Prices at 1800 LMT reflected prices that had been rising all day, with Light Sweet Crude at $74.61 and Brent Crude at $74.97.

There are two main contributing factors today in that Irans stance over enriching nuclear fuel has not changed since the crisis began. Iranians claim that it is for energy generation. Russia and China would prefer the crisis to be ended by negotiations rather than UN sanctions. Iran remains defiant and claims to have further refined their nuclear fuel up from 3.0 to 4.5.


The second but by no means less significant is the Bolivian Governments take-over of foreign owned oil companies assets in that countrys gas fields. Bolivia has the second largest deposits of natural gas in South America, so the losses to foreign companies will not be minimal. In total, 56 locations were taken over, with Britains BC Group PLC, British Petroleum, Petroleo Brasilerio SA, Repsol YPF SA, Total SA and Exxon-Mobile Corp. amongst those affected.

President Morales announced the take-over a day after he returned from Cuba and an economic summit with Venezuela and Cuba. In his statement, President Morales indicated that the foreign companies were looting Bolivias assets to line their pockets and that the people of Bolivia now had total control of their own assets. It is his hope that the additional revenue would help to lift his people out of poverty.



If the people have been ripped off it could be due to insufficient foresight, research and planning on the part of the then Bolivian Government in relation to what their takings would be from their own resources. Being an economically challenged country at the time meant that foreign investors were needed to get the industry up and running. With that purpose realised, a pull-out of the foreign investors would mean a lot of work for Bolivians to meet the standards set by the industry.

LOCAL IMPLICATIONS:

It seems as though the philosophy of getting everything possible out of known reserves may work to drive up the price of oil even further, as it is evident those reserves are in politically sensitive areas. Areas where there are sabotage to oil facilities also cause the nervousness that makes the per barrel crude price go higher. It is time to have a look at exploring in less politically sensitive areas and to begin to tap the rich resources that are within them.


Exploration in the North and South Falklands Basins have uncovered vast reserves of hydrocarbons both natural gas and crude - and it is about time to find out exactly where they are by getting a semi submersible rig for the North Falkland Basin and a suitable drilling ship for the South Falkland Basin.


Were ready to go!

Transocean Fleet Update 1.5.06

http://media.corporate-ir.net/media_files/irol/11/113031/reports/050106.pdf

http://www.thisisnorthscotland.co.uk/displayNode.jsp?nodeId=149212&command=displayContent&sourceNode=150624&contentPK=14417512&folderPk=85744

WELL PROJECT-MANAGEMENT EXPERT AIMS TO REACH NEW AMERICAN PEAK

In stead of Desire representing them selfs on the PR front they have now represented by a company called Buchanan Communications to do this for them ,and this has been confirmed to me today.

http://www.buchanan.uk.com/index.html

Sounds good news to me as Desire were always very poor on the PR side of things and replying to emails.

.

Hot off the press annual report

http://www.desireplc.co.uk/pdfs/annual_report_05.pdf

Hi all

Thanks to all for the updates, Markymar, Captguns.

DES seems to have lots going on at the moment. The annual report having some good reading. The support and resistance are very close together at the moment, so it looks like one will be broken soon. DES has been holding well above the 200 day moving average, with the 10 day moving average taking a bit of a turn up towards the 20 day moving average. These indicators sugesting DES may be about to move up again. With all the news going about, the market may take a closer look at DES. Hope so !





Good Luck All

Eddie

Cheers Marky-they've got rid of the drill from the front cover I see!

Cheers Eddie for update,Aur that could of been the jinks!

There are 10 drill location now will be an intresting AGM i think!!


Hydrocarbons Daily Record (04/05/06)
May 3, 2006
by J. Brock (FINN)

HYDROCARBONS DAILY RECORD (04/05/06)

By J. Brock (FINN)

At midday Light Sweet Crude was quoted at $73.10 per barrel with Brent Crude at $73.99. Prices at 1800 LMT reflected a further decline in the price per barrel with Light Sweet Crude at $72.55 and Brent Crude at $73.51.



Contributing factors for the decline include an increase in the supply and a lessened demand for gasoline in the United States as well as a softening in the rhetoric of President Morales in Bolivia. A meeting between President Lula of Brazil, President Kirshner of Argentina, President Chavez of Venezuela and President Morales of Bolivia is to take place on Monday in order to find ways forward for Bolivia, who has a need to exact more revenue from its vast natural gas reserves the second largest in South America.



LOCAL IMPLICATIONS:



Though untapped, the potential for huge hydrocarbons reserves in the North and South Falkland Basins helps keep morale high, even though FIG are reviewing the budget. Other good news can be seen below.



26 April 2006

DESIRE PETROLEUM PLC: FINAL RESULTS

Chairman's statement

The results for the year ended 31 December 2005 are set out below. The profit shown after tax was entirely due to interest received and exchange gains. The latter resulting from your Board's decision to hold most of the Company's funds in dollars. As in previous years, overheads, which are covered by interest received, have been kept low despite the very considerable increase in activity consequent upon preparations to drill in the North Falkland Basin.

The focus of the year's activities was on preparing a three-well drilling programme in Tranches C and D in the North Falkland Basin and sourcing a suitable drilling rig to fulfil it. There is a well-publicised, world-wide shortage of drilling rigs which has severely affected the entire Industry, not least Desire. Rig-rental rates are also at historically high levels.

In view of the extraordinarily tight rig market and the major increase in costs, your Board, whilst continuing actively to secure a rig, has reviewed the Company's strategy for renewing drilling in Tranches C and D. At the moment, there appear to be two alternative options: to await a change in the rig market or to seek a partner with access to a drilling rig. As the second of these options does not preclude the first, a programme to identify and secure a suitable partner was initiated early this year (2006).

Possible partners include oil companies with long-term rig contracts or drilling companies themselves. In the past, drilling companies have not normally been interested in taking equity positions in drilling programmes except when the rig market was exceptionally weak and it was one of the few ways of utilising their hardware. However, the current, historically-high, rig-rental rates have had the effect of making many drilling companies cash-rich; this factor, together with the attraction of major multiples from successful equity participation in oil and/or gas discoveries, has caused them to take a fresh look at equity deals and a number of drilling companies are now prepared to discuss such ventures. Even so, most drilling companies do not, themselves, have spare rig capacity because most of their rigs are tied-up in long-term contracts.

Nevertheless, Desire has entered into discussions with a number of companies with rigs interested in equity in Tranches C and D. The nature of the participations under discussion may not take the usual form of industry farm-outs and your Board is considering innovative ways of structuring them. It is not yet possible to say that these discussions will be successful nor, if they are, at what date a rig will become available.

The rig market itself is likely, in due course, to return, as it has done in the past, to more normal conditions of supply and demand. Rig supply will increase as new rigs are built and demand can be expected to slacken, either because of a lack of exploration success or because major new discoveries are made. Current exploration success rates are poor world-wide and, if this continues to be the case, more rigs will become available as companies draw their exploration horns in. As a consequence of this lack of exploration success, the attractiveness of the North Falkland Basin, with its world-class source rock, is likely to increase.

Despite the lack of a rig, work has continued on preparations for the drilling programme. Peak Well Management has been appointed to oversee the programme, nine drilling locations have been selected, well designs are being finalised, initial site surveys have been carried out using the 3D seismic survey, the Environmental Impact Assessment has been submitted to the Falkland Island Government (FIG), the well tubulars and wellheads (of which there is also a world-wide shortage) have been ordered and a myriad other requirements and contracts, such as for waste disposal, helicopters, crew-change facilities, etc., are being put in place. Apart from the requirement by the UK Health and Safety Executive, on behalf of FIG, to approve the safety management system of the rig when contracted, all of the essential plans for the drilling program are well underway or in place and drilling will be able to commence as soon as an approved rig is acquired.

One strategy option, so far rejected by your Board, is that of farming-in to the existing exploration drilling programmes of other companies. Although several opportunities have been considered, none were anywhere near as attractive, either technically or in terms of potential upside, as drilling in Tranches C and D. Accordingly, the decision has been taken to conserve the Company's funds and to continue to concentrate all efforts in the North Falkland Basin.

I am very pleased to welcome Mr Edward Wisniewski to the Board. Eddie is a Chartered Accountant with extensive oil-industry experience whose contributions, both as a non-Executive Director and Chairman of the Audit Committee, have already been substantial. All of my other Board colleagues continue to play essential roles, in particular Dr Ian Duncan in his capacity as Chief Executive.

Although the past year has been a frustrating one, not least for your Board, I believe that the strategy adopted is the correct one which will, in due course, lead to a resumption of drilling in the North Falkland Basin.

Yours sincerely,

Dr Colin B. Phipps

Consolidated Profit and Loss Account for the year ended 31 December 2005

Raha predicts doubling of rig count

By Erik Means


Subir Raha, the chief executive of Indian state oil company Oil & Natural Gas Corporation (ONGC), said he expects the offshore drilling rig count in India to nearly double over the next five years as the world's second-most populous nation strives to meet its ballooning energy needs.

Today we have a fleet of about 30 rigs jack-ups, floaters or combined and the total number of rigs in India offshore (is) something like 45 or so, Raha said.

What I see in the next three to five years with new finds being brought to production, new blocks for exploration I suppose that the rig count should (increase by) about 35 or more from the present 45, he told UpstreamOnline.com during the Offshore Technology Conference in Houston.

Raha continues to tour the world in search of partnership deals with oil companies and service contractors.

Transocean taps in to rich seam

By Upstream staff


Global rig contractor Transocean today reported a larger profit for the first quarter, as strong customer demand bolstered both utilisation rates and daily rig rates.

The company posted a net profit of $205.7 million or 61 cents per share, compared with a year-earlier profit of $91.8 million or 28 cents per share.

The first quarter of 2006 included after-tax gains of 12 cents per share for asset sales. Transocean forecast revenue growth throughout the rest of the year, but said such growth in the second quarter would be more than offset by higher operations and maintenance expenses from increased out-of-service time for rigs.

Second-quarter operations and maintenance costs are expected to exceed those of the first quarter by up to $75 million, the company said. However, those expenses should decline in the second half of the year, Reuters reported.

Here is one for you Capt

Woodside set for second Kenya wildcat

By Iain Esau


Australia's Woodside Petroleum has committed to drill a second wildcat on its deep-water frontier acreage off Kenya.

Woodside and its partners UK-based Dana Petroleum and Aussie minnow Global Petroleum have decided to enter the "first additional exploration phase" of their Block L-7 production sharing contract, which calls for one well to be drilled before June 2008.

Global will be fully carried through the first exploration wells in each of blocks L5 and L7 and retains 20% equity, leaving Woodside with 50% and Dana with 30%.

The first well is due to spud in Block L-5 this October after the board of the Japanese Agency for Marine-Earth Science & Technology (Jamstec), owner of the drillship Chikyu, approved the rig contract with Woodside.