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

http://www.falkland-malvinas.com/Detalle.asp?NUM=5113

For the record we were a bit too bullish on the effect on Desire's price of a) the RNS giving details of the placing. Hopefully our forecasts for the effect on the price due to b) the details of the farm-in will be more accurate.

Eddieshare
a) 89p
b) 158p

Luckyswimmer
a) 66p
b) 96p

Oily Jim
a) 78p
b) 118p

Ptkenny
a) 86p
b)102p

I hope the rumour on the other board that we can expect details of an impressive farm-in in two weeks time is correct. I am also reading Rockhopper's involvement as just a preliminary step to achieve "greater flexibility in negotiating" the real farm-in deal.

Any suggestions for the next round of forecasting ? e.g. c) price on first well spudded d) price after first succesful gas flow test e) price after first succesful oil flow test f) price when oil hits $80 per barrel - oops, I'm getting carried away, what a good day, hope to meet some of you at the EGM.

Luckyswimmer

A bit to bullish lucky i think we have only been given half the story so if we had the full story then maybe those prices would of been correct.

Expect more partners in the coming weeks or months and more holes to be drilled.

"Greater Flexibility in negotiating" said the man with the aces up his sleeve and it will give Desire shareholders the best deal possible and that will add value to the share price.

Regards

Markymar

just a little mention of Desire here in the stock market reporter tonight, well i better take that good lady for a meal so have a goon night all.

Shares in Desire Petroleum jumped 4p to 56p after it said it was to raise up to 25.15 million pounds through a placing and open offer and as it said it had identified drilling targets. The oil explorer said that a 3D-seismic survey had identified drilling targets with a potential to discover over one billion barrels of recoverable oil in Tranches C and D in the North Falkland Basin. Preparations for a 3-well drilling programme in Tranches C and D were underway. The company also said it had agreed terms with Rockhopper Exploration to farm-in to the 3-well programme to earn an interest of up to 15% of Tranches C and D by funding up to 30% of the costs of the programme.

Hi all

Well it looks like we have had a mixed reaction on the stock market. This will be because DES has not yet announced the major partners. Although the news is excelent! Some will be unsure! DES picked up again in late afternoon. What is clear is DES is going forward with what is the best option for its investors. Over a billion barrels & only 15% given up! That can only mean a massive potential for investors! So when we get the full picture of the majors, maybe we will have been right about our forcasts.





Thanks for all your work markymar
Thanks to all the other positive posters

Good Luck All

Eddie

Thanks to you to Eddie. Keep it going please. It will be interesting to see if any press reports push this further up or down!! tomorrow. Plenty more volatile days to come i`m sure.
No red candle today Eddie?
Regards
Berlingo

Eddieshare

Forgive me for being just a little bit blunt but you cannot be serious about a mixed reaction by the stock market. Desire have just placed millions and millions of additional shares on the market dissolving the value of the existing shares, then the market opens up at 57p. Traditionally, this price would and should have gone down by at least 10%, but the markets confidence was so great that it not only advanced, it held.

Up 3p tomorrow.

Good luck guys.

Hi florida

DES is 53% of my portfolio. I would not benifit from trying to be negative about DES. I'm not negative. I think the news is absolutly great! The main trend is definatly up & I will definatly be holding my shares. I will also be getting my 1 for 8 @ 0.45p. Don't worry about being blunt either.


Kind Regards

Eddie

florida v eddie - round 1
no need to squabble
florida - having a go then says up 3p next session
don't quite follow
notwithstanding all of that
news today is welcombe
hardcore followers were becoming worried
3d surveys were not up to scratch
and majors not coming onboard
news today seems to counter that view
although news still seems a bit cloudy
more is needed - sprat & mackeril therory ( cant spell sorry )
but positive news is better than no news
vibes are good, all come aboard soon not to miss
the rollercoaster ride
widows & orfans will move aside
fortune favours the brave - hold on tight to your dreams

regards HUSTLER

The stockmarket exists to allow companies to raise funds. That it is normal for small investors to get side tracked by the dilutitive effect of issuing more shares and therefore to expect a share price to go down says more about the ignorance of fundamentals by small investors. Desires price went up yesterday because the money is being raised for the long term benefit and profit of the company, that's it, simple! The fact that it went up also speaks volumes, issuing shares to raise money to progress is not negative, it is a positive!

From the Daily mail

Desire Petroleum rose 3p to 56p as a positive survey triggered the well-flagged fundraising move. The company is to raise 25.15m via a placing and open offer at 45p a share.

Now 53-55. looks like 48p on the card. Looks like a combination of cold feet and others forward selling their 1 for 8 right.Will happily close my short at 48p and will be a buyer at that level

Eddieshare - My response was not an attack on you personally, merely an observation of what seemed to be a slightly unnecessarily depressed view of what I interpreted as a triumph.

Your input to the threads has been greatly appreciated by all. I hope no offence was taken.

Travis, I think you will be lucky to get 48p. I agree that a lot of investors will sell some of their holdings to pay for the cheaper 45p offer but not those that are locked in with capital gains or those who wish to minimize any dilution. There is a possibility that sales will be soaked up by investors who now realise that Desire's chances of finding oil have improved considerably with it's new found ability to order a rig. If further news on farm-ins arrives in the meantime then it wouldn't be good to be holding a short.

Good luck fellow Desire holders.

Travis, I think you will be lucky to get 48p. I agree that a lot of investors will sell some of their holdings to pay for the cheaper 45p offer but not those that are locked in with capital gains or those who wish to minimize any dilution. There is a possibility that sales will be soaked up by investors who now realise that Desire's chances of finding oil have improved considerably with it's new found ability to order a rig. If further news on farm-ins arrives in the meantime then it wouldn't be good to be holding a short.

Good luck fellow Desire holders.

You can say that again Lucky

Luckyswimmer
I agree with you. The posting below that I found on another site encapsulates my feelings on this subject. Perhaps Travis would like to respond to these thoughts. It would indicate that we are close to the level we can expect in the interim before the placing.

Here goes:
There seem to be quite a few pessimists on here who think the shareprice will drop down to 45p. I don't quite know what their logic (or agenda) is but they are obviously unable to evaluate the basic arithmetic of a new equity issue.

Based on the closing price of 52.75p and a company market cap of c85 million the day before the announcement of the fundraising, and the amount of new equity raised at 45p (c25 million) the theoretical ex-rights price (for want of a better term) is above 50p once the new shares are issued.

So a price of 51p or so is the theoretical floor for the share price.

Based on the fact that the placing was oversubscribed there should be some institutional buying in the open market which will keep the floor price somewhat higher. Of course the MMs may well try their little shakes from time to time.

I suspect that DES may well announce further farm in news before the new equity issue, not that it will be needed to get the issue away, in which case the share price will be significantly higher.

Markymar, my technical skills are on a par with Alistair Campbell's mastery of Blackberries, lucky I'm not famous. When Desire strikes oil and England produces a TV series following the lives of the Desire BB Hillbillies then I might be more careful.

JP SALKELD, thank you for your support. I think your last paragraph is the key here, "possibility of further farm in news soon". In the oil sector it is true that share prices fall towards any placing price for a while and then often go on to new heights. An interesting analogy is Sterling which today has recovered to 17.5p after a cheap placing dragged it's price down for a few weeks. The short term dip turned out to be an excellent buying opportunity and I think 54p will turn out to be an excellent buying point for Desire. Sterling already are producing oil and have used the placing to do a deal to generate impressive cash flow in two years time. In Desire's case the company, yesterday, has begun it's transition from a risky exploration stock to, possibly, a producer with an even more phenomenal cash flow than Sterling's. At some point Desire's share price will rocket -I wouldn't want to be trying to short this stock for a few pennies like Travis when the market's moods suddenly light the touchpaper.

Hi all

Florida no offence taken, water off a ducks back.

luckyswimmer good to see you still have a GSOH.

Lets look at a longer range chart (1 year). As we can see the long term trend is deffinatly up. The speculation on the BB's is that 0.50p could be the bottom line. As we can see from this chart 0.50p has a support level. If we were to draw a horizontal line at about 0.50p, you will see the candles sat on this line. This appears to give confirmation of JP SALKELD'S theory. If this theory & the candles are correct then we shouldn't see much more retracement. DES currently has 163m shares out & intends to create another (approx) 55m this would then be 218m shares out. This would then Value DES 98m @ 0.45p. If on the back of the news DES went to 100p, DES would then be valued at 218m, (this would be a substantial increase from 163m @ 100p) A difference of 55m. This would rais DES's profile substatialy & would make DES more liquid. DES is currently at 86.2m (EGM Date 10th March)




So the small retracements you see are in significant !

DES is goin up !

Thanks markymar for your postings !

Thanks to all other posters !


Good Luck All

Eddie