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

I see Desire made it into 'Upstream' again :-

Speedy turnaround on cards for Falklands data
Upstream, Friday June 4
By Iain Esau

UK MINNOW Desire Petroleum is trying to accelerate the interpretation of seismic from a Falkland Islands survey in order to allow early viewing of data, writes Iain Esau.

Chairman Colin Phipps said all of the 3D data acquired in the North Falkland Basin had now been loaded and processing was proceeding well.

However, to expedite data interpretation, Desire's board has decided to implement a fast-track process which, it is expected, will allow interpretation to begin at the end of this month, with preliminary results available by late August.

The company said these results will then form the basis of continuing discussions with potential farm-in partners, including the selection of drilling locations.

Desire operates Tranches C, D, I and L in the North Falkland basin where eight prospects had been mapped earlier.

These include Ann (282 million barrels potential), Pam (201 million barrels) and Liz (392 million barrels) in Tranche C, Ninky (376 million barrels) straddling C and D and Anna (477 million barrels) in tranche D.

Tranche I holds Dawn (146 million barrels) while L contains Ruth (259 million barrels) and Kate (285 million barrels).

Fugro's 800 square kilometre plus 3D shoot covered the three largest structures in Tranches C and D and also extended in to Tranche F who may also host part of the Ninky prospect

thanks to oily for this one.

Desire in farm-in talks - Falkland Islands

Wednesday, June 9, 2004 19:06 (GMT-0400)


UK oil company Desire Petroleum is in discussions with potential farm-in partners for its four exploration blocks in the Falkland Islands' northern basin, Desire chairman Colin Phipps told BNamericas.

The farm-in partners would operate the blocks while Desire would participate with a non-operating share, he said. "Anyone who farms in is almost certainly going to want to operate it in order to control the costs."

"The increase in the oil price has attracted a lot more attention to the Falklands in general, and we are in particular seeing more interest, which is helping our negotiations as far as a farm out is concerned," Phipps said.

Desire carried out an 800sq km. 3D seismic survey in 2004 in its North Falkland basin acreage, and is now processing the data. Results could be available in August, which Desire would use to determine its drilling and investment program.

Exploration drilling could begin in 2005, with production possibly starting up in 2007-2008, he said.

Desire has identified eight major prospects in its blocks, with a total 2.4 billion barrels of potential oil reserves. The company holds a 100% interest in 3,650sq km. in the North Falkland basin in Tranches C, D, I and L, and owns 12.5% of Tranche F, operated by Canada's Talisman Energy.

Desire has invested about US$20mn so far in seismic studies and drilling in the north basin since 1998, Phipps said.


By Julian Dowling

BNamericas.com

the ship is sailing dont miss the boat .....good little rise again today

Well we finally got a bit of press Today and its the good old Daily Mail again.

Just sit back and enjoy the ride !!

DAILY MAIL
* American bid hopes make punters scramble for Egg - Speculation that Desire Petroleum is in talks with Shell about farming out its licenses in the Falkland Islands to Shell - Profile Media a Charles Stanley buy

SEISMIC data collected in the Falklands is undergoing a fast track processing route and should be ready for interpretation at the end of the month.
Penguin News yesterday contacted Dr Colin Phipps, Chairman of Desire Petroleum plc, to ask if he could confirm rumours that oil giant Shell had shown interest in returning to the Falklands to carry out exploratory drilling.
Dr Phipps said he could say nothing about, ...who might or might not be coming in. This is something that would have to be put out to the Stock Exchange.
However he said all the 3D seismic data recently collected in the Falklands has been loaded for fast track processing, ...and it all should be ready for interpretation at the end of this month or the beginning of next month.
He said the data will take approximately six weeks to interpret, ...then well know what our principle objectives are and we will be able to sit down and hopefully organise a deal for exploratory drilling in tranches C and D.

Desire Petroleum (AIM: DES) 33p
Desire is the ultimate blue sky story and
serious newsflow is due within two months.
Desire holds 100% of four tranches in the North
Falklands Basin and 12.5% of a fifth. Detailed
3D seismic surveys were completed in May
and the first results are expected in late
August. 3D seismics have grown steadily more
accurate over the years but they still have
trouble telling between sandstone containing
oil and sandstone filled with water. Even so,
Desire has already made cheerful hints and
this suggests the news should be good
enough to entice companies to sign
exploration partnerships.
Six holes were drilled in 1998 near the
Falklands. Four found serious signs of oil but
not enough to be commercial. The oil price
then collapsed and interest dwindled. Desire
points to structures in its tranches which
might hold 2.4 billion barrels of recoverable
oil. Even if Desire holds only 10% after bringing
in partners, this would translate into
valuation of 400p per share or zero if nothing
is found. At 33p the company is valued at 38
million. Expect the price to rise in the coming
weeks as excitement builds. Westmount
Energy (AIM: WTE) holds 3.4% of Desire and
Greenwich Resources (GRWA) has 4.2%.

Jeffmac 35p now

Hello folks, first posting for me on this board, been posting PX targets on iii for last few months using a pricing model that seems to be fairly intune with how Desire are progressing. Markymar suggested you folks may be intersted in my postings so here below is my screen dump of latest posting from iii.

Good luck everyone
Happy Hunting
JPDM :-

Hello folks,

The mag news does change things a bit so heres a quickie update:-

Lifting July PX range as follows:- Mid px 31p - 45p
this is made up of 32p - 38p (old pricing model) + potential upside px premium of 7p (Press news premium). Potential also increases for a wider spread especially towards end of trading hours.

Thanks everyone for all the info and thks wildman for your px thoughts, really helpful.

The nature of this stock is entering a new phase now! do watch out for the 38p level, as previously mentioned this is a resistance point and there could be a limited amount of profit taking around that level, roll on the press news!

Happy Hunting
JPDM FM

fill ya boots

JP thankyou

JP, as above but I think 38 will prove less resistance, more institutional buying than first thought and they want more than 38p as a sell, we could go straight past. One more thing, more people read iii than post including me, keep up the good work and remember that what you are posting IS having a material impact on the SP, people know who's got a brain, natural instinct.

well good tick up today,thought i saw 40p befor just off....next stop 60p if we get past 40p

LONDON, July 16 (Reuters) - U.S. oil prices held firm near $41 on Friday as the most robust demand growth for more than two decades pushes OPEC to keep pumping crude at near capacity, leaving world supplies vulnerable to the slightest production hiccups.
U.S. light crude rose 18 cents to $40.95 a barrel, just a hair away from a six-week high of $41.12 touched on Wednesday. And prices are near June's $42.45 peak, a record for the contract's 21-year history.
European benchmark Brent was up 29 cents at $37.77 a barrel, buoyed by an exceptionally strong cash crude market in the North Sea.
Gains were spurred this week by an unexpected decline in U.S. crude and gasoline inventories, plus worries that heating oil supplies are not being built-up quickly enough ahead of the winter.
The U.S. oil data added to fears over supply disruptions at a time when output capacity was being stretched by rapidly growing demand -- estimated to be expanding at 2.5 million barrels per day (bpd) this year, its fastest clip in 24 years, according to the International Energy Agency (IEA).
The Organisation of the Petroleum Exporting Countries (OPEC) is proceeding with its planned output ceiling hike of 500,000 bpd from August 1 in an effort to cool prices, but it looks unlikely to mean more crude.
The group, which controls around half the world's oil exports, is already pumping nearly two million bpd over its new 26 million bpd August quota, very near the its maximum capacity.
With little to discuss, the cartel cancelled next week's planned ministerial meeting. It will next meet September 15.
"The cartel perhaps concluded that aside from the Saudis, the rest of the group is pretty much tapped out in terms of exports," said Ed Meir, analyst at brokers Man Financial. "Therefore, having a meeting to discuss more 'phantom' quota increases would be of little use."
Kuwait said on Thursday it had spare oil production capacity of almost 100,000 bpd, while Saudi Arabia, which has been producing around 9.1 million bpd, has the capacity to crank it up to 10.5 million bpd.
"The meeting is cancelled because the market is stable. There is no problem at the moment because the decision to increase 500,000 bpd from August 1 is in place," OPEC president Purnomo Yusgiantoro told Reuters on Friday.
HEATING OIL WORRIES
Distillate supplies in the United States, where the Northeast region is a major winter-time consumer of heating oil, have emerged as an early driver for the energy complex as dealers fretted over the pace of pre-winter inventory building.
Heating oil futures reached a year-and-a-half high of $1.1080 a gallon this week, the strongest on record for July, when gasoline is typically the market's strongest product. On Friday, it was trading up 22 points at $1.1008.
Seeking to avoid panic buying, the U.S. government Energy Information Administration (EIA) said on Thursday there was plenty of time to boost heating oil inventories before the winter heating season arrives, so traders should not bid up fuel prices.
It's much too early to worry about heating fuel supplies, EIA administrator Guy Caruso told reporters.
This week's EIA data reported a significant build up of 2.7 million barrels in middle distillate inventories for the week ended July 9, putting them three percent above this time last year.
Caruso conceded that the United States came out of the spring with relatively low heating oil stocks, but added that if crude imports continued to average 10 million bpd and there were no major refinery outages, heating oil stocks should be in the "normal zone" by November.
Still analysts said that, while stock levels looked comfortable on the surface, rapid economic growth could place more demands on inventories than in previous years.
Tetsu Emori, chief commodities strategist at Mitsui Bussan Futures in Tokyo, said fund speculators would remain on the buy side of the market on persistent fears of disruptions to crude flows in Iraq and possible refinery outages in the United States.
"There are no bearish factors in the market. Already we are over $40 and there is still room to move higher," he said.

meic is that you ?

Hi folks, yep on bit of a guilt trip over Maggie, read it all wrong, posted an apology on iii.

Been trying to punch in some numbers over the weekend to come up with some px ranges and its becoming steadily more and more difficult. Without giving too much away, I've got this pricing model that I've been running over last few months based on previous news and investor reaction to that news. Basically i number facts on a 1- 10 scale of positiveness and likewise with the resulting price move, volume and investor sentiment.Then, I apply some of my own gut feeling (in todays trading world gut feeling seems to have gone out the door but as a somewhat 'oldie' in my late 30's I find it really works!).

I believe we still have a good 4 - 5 weeks to go before news of the 3D can be expected. Over the last week Desire has gone up a good 30%+ and I don't think that growth can be continued at the same pace without some dips on the way. I see this stock at 60p by Mid/late August which seems to tally with a lot of other opinion. I'm lifting my price range for the coming week very slightly to 34p - 42p. If the price does touch 45p next week then as I have an average price in the mid teens I will take a 10% profit and might put some of that cash into Hardman. Long term I'm a strong Buy. Stocks such as Desire don't often come along!

Good luck everyone and again, Maggie, if ya reading, my apologies.

Happy Hunting folks
JPDM FM

Ladies and Gentlenmen,

THe following is a 'late night 'ramble'' and personal overview which I hope is of use in your investment descision with Desire:-

World consumption of oil is rapidly increasing, China, Asia, Brazil etc. Saudi Arabia and Iraq have massive reserves but also suffer from a growth in political unrest.
Russia has a mass of untapped reserves but is still to be regarded as an emerging market that apart from the Yukos affair suffers from inferstructure problems. all of this creates uncertainty.

The oil majors and Shell in particular are desperate to find new reserves, currently more oil is being used than is being found.

The Falklands Islands are a British protectorate and our conflict with Argentina was not just for two thousand islanders, it is the gateway to the Antarctic, has rich fishing grounds and also massive potential for oil!

Existing 2D surveys and rock samples have shown the North Falkland Basin to hold source rocks which are the second known richest in the world, FACT! Its like a sponge that you use to wash your car except we are talking oil. Over millions of years the source rock (sponge) gets squeezed from above, below, the side etc and the oil migrates. What you then need is a barrier that acts like a dam and the oil forms in a pool (your oil field). The North Falklands Basin, at least parts of it are currently believed to be not dis-similar to that of the brent structure in the North sea. I understand that it took 17 wells before oil was found in the North sea and look at what has been since recovered!

Desire is a unique stock, it was set up purely to prospect for oil in North Falklands. 6 wells were drilled in the late 90's and 5 wells found at least traces of oil. Unfortunately it was a somewhat rushed 'wildcat' drilling programme that was terminated by oil prices falling to 10$ a barrel. From the subsequent analysis it appears to be generally confirmed that they did not drill in the best locations.

This is frontier stuff, if the 3D survey shows the potential for one or more oil fields the we have a potential new world oil province and Desire owns a massive acreage!!!

The potential for this stock is therefore incredible, on a positive side 5, 10+ is a real potential. On the downside I see only a 3D result that is inconclusive. Inconclusive still gives in my opinion some value to this stock of say 10p. So looking at the max downside and the max upside we have a stock that is more than just a toss of the coin.

Over the next few weeks we are going to probably see this stock rise in anticipation of news from the 3D survey and also from any possible farmin arrangement. On the way we will also see dips.

My personal view as a holder of well over 100,000 shs is that I couldn't miss this opportunity to be part of something so exciting in potential.

To new investors I urge you to read up on the history and facts from the last 6 years to gain the full picture of the potential.

Good luck and good fortune to everyone, end of this month I'm off to Iceland for a week but will take my laptop to keep in touch (girlfriend probably wont be too impressed!)

Happy Hunting

JPDM FM

keep up the good work Jp you will need plenty of money for Iceland , i hope you dont drink to much because its very expensive. Am sure you will have a holiday of a life time over there.

U.S. addiction to foreign oil deepens
Mon 19 July, 2004 09:09



By Timothy Gardner

NEW YORK (Reuters) - U.S. domestic oil production has dropped five percent since this year's peak in February and near-record oil prices are unlikely to inspire drillers to slow the country's deepening dependence on foreign oil, experts say.

"Why on earth would you drill here when we've been drilling here for 120 years and when there's vast untapped regions across the globe?" said Kyle Cooper, analyst at Citigroup Global Markets in Houston.

U.S. pumps pulled 5.43 million barrels per day of oil in early July compared to 5.70 million bpd in early February, according to the federal Energy Information Administration. The United States uses all of its domestic crude production. It relies on imports of crude and oil products for the remainder of the approximately 20 million bpd of oil it burns daily.

As domestic output dropped this summer, crude imports averaged more than 10 million bpd for a record two months, the EIA said this week.

U.S. production often falls in the summer as workers repair Alaskan oil infrastructure during the thaw. But rarely has the summer production droop been so deep.

Last year in early July, for example, domestic output was slightly above February production. By August, production had only slipped about two percent below February output.

A six-week outage of Royal Dutch/Shell's 150,000 bpd deepwater Mars platform this summer in the U.S. Gulf coast helped to cut output.

But the impact of outages is intensified by a long-term drop in U.S. oil output, said Mir Yousufuddin, who tracks oil production for the EIA in Dallas. U.S. oil output peaked during the Arab oil embargo of 1973 when production was 9.3 million bpd.

U.S. production in 2003 fell 1.5 percent to about 5.7 million bpd, and the trend is on track to fall.

GULF BOOM WONT CUT ZOOM IN FOREIGN IMPORTS

New production from the U.S. Gulf deepwater oilfields next year will help cut the U.S. decline, but a long-term drop in California production, the nations fourth largest oil producer, combined with rising U.S. demand, and a fall in domestic drilling since 2001 wont cut reliance on record imports, experts said.

Seven new field start-ups in the U.S. Gulf in the second half of 2004 as well as BP's Holstein and Thunderhorse fields in 2005 could add as much as 450,000 bpd at peak if all goes well.

But that will not stem the decline of production of mature fields in Texas and Oklahoma, and especially California. In the Golden state, output has fallen about from 842,000 bpd in 2000 to an average of 742,000 bpd from October last year to March this year, according to state records.

And U.S. petroleum demand will rise 380,000 bpd this year and another 300,000 barrels next year, the EIA estimates in its latest monthly report.

U.S. President George Bush's plan to tap the Arctic National Wildlife Reserve, believed to hold as much as 16 billion barrels of crude, has so far been thwarted by environmentalists. Even if ANWR was tapped, production would take about 10 years to begin according to government estimates.

What's more, record prices for oil futures of over $42 per barrel hit this summer have failed to dramatically boost oil exploration drilling, except in California.

Despite record oil futures, there were 168 rigs searching for oil in the United States last week, up 14 from last year, but down 55 from the same week in 2001, according to the Baker Hughes rig count.

"We've expected an increase for almost a year now," said EIAs Yousufuddin. "The industry for some reason is holding tight. They are investing in repurchasing their own stock, investing somewhere else, not in exploration drilling."

Virgin oilfields in Africa and Latin America have made major U.S. oil companies explore elsewhere. "When the fields and the production rates are so much higher, when your environmental, regulatory issues and labor costs are so much lower, you can afford pay $3.50 to $4.00 (a barrel) in transportation costs to ship oil from there to here," said Cooper. He said lifting costs can average as much as $10 a barrel abroad and as much as $20 a barrel in the states.

The impact on increased foreign oil demand on U.S. consumers is debatable.

Some see the lower lifting costs abroad as a bonus. Others see the growing dependence on foreign oil as a potential problem, especially with American drivers fondness for big automobiles.

"Its not good for the consumer to rely on foreign oil," said Jack Aydin, analyst at Keybanc Capital Markets. "But lets put it in perspective. Europe has relied on foreign oil all along. It hasn't hurt them, except they cannot have cars getting 12 miles a gallon (19.2 kilometers per 3.8 liters)."

RNS Number:0079B
Desire Petroleum PLC
20 July 2004



DESIRE PETROLEUM PLC

("Desire")

The Board of Desire announce the completion of the fast-track processing of the
804 square kilometre, three-dimensional (3D) seismic survey carried out in
Tranches C and D of the North Falkland Basin. The processed data are now being
subjected to detailed interpretation from which potential drilling locations
will be selected which, in turn, will from the basis of farm-out negotiations
with several potential partners.

For further in formation:

Dr Colin Phipps: 01684 892242

Dr Ian Duncan: 01684 568415




This information is provided by RNS
The company news service from the London Stock Exchange

END

Falklands-Malvinas
Wednesday, 21 July


Report on interview of Dr Colin Phipps.



Dr Colin Phipps of Desire Petroleum explained to FIBS that although the recent seismic survey conducted by Desire Petroleum was what is known as 3 dimensional, this was not strictly the case.



However in this type of survey the lines of survey were 10m apart as opposed to 1km apart in 2 dimensional seismic surveys. This gave an effect, which was virtually 3D.
This increased density of surveying of course meant one hundred times the amount of processing of the date. Dr Phipps explained that processing was necessary to remove from the findings any extraneous factors such as the effect of waves or any electro-magnetic influences from the ship itself. The result of such processing would be a clean and near as true picture of the seabed.

Next step after processing was the interpretation of the results of the seismic survey, which would give the closest possible indication of where precisely drilling should be done. This, Dr Phipps estimated, would take a further two to three months.

In answer to Sue Gyfords question as to when drilling might begin, Dr.Phipps said that he hoped it might be as early as the beginning of next year, though this would depend on rig availability amongst other things. Hiring a drilling rig was, he said, a hugely expensive process and it could also be very time-consuming, unless there happened to be a rig available relatively close to the Falklands, for example in Brazil.

Source: FIBS by Sue Gyford