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

you're spot on RF
however, it's an interesting call as to whether or not DES is now undervalued relative to RKH
my money says that DES is a good trading stock in the present climate - so i do not mind at all that price has improved further since i banked my profit yesterday - as if the RKH flowtest is good, then though DES will benefit, RKH will benefit even more AND RKH happens to have a 7.5% stake in the relevant DES licences

Exactly, and I sold at just over 116p....so at the present moment not too bothered about todays rise.....so far.....

If the probablity is that RKH test will be good, I feel that it is too early to be out of any of these. Am holding with a limit sell, pending SL results. Calculated risk, but more upside that downside, imo.

For what it's worth, agree with Harry. All will be influenced by RKH, decision time is on or after flow test results. A hold for now.

Des will probably along with RKH go up.....not so much.....because so far it has next to nothing to show, but the pullback afterwards could be severe and I cannot watch all the time...some days I can...others I cannot...DES is overvalued now, so god knows how could it be valued at say 450 million pounds if RKH comes good...crazy....I fear a sharp drop back to reality....

RF, the flow test will be postive next to drill is Desire the only way is up.

You don't think that the market cap is too high ?...on positive results from Rockhopper : this could rise as well but not so much as RKH....and then with a market valuation in excess of 400 million I fear a pullback on punters thinking that the next well could turn out to be a dud....

StockMarketWire.com
Desire Petroleum started at Evolution with buy rating, 136p target price.

DES shifting up nicely again today with good volume....should accelerate if Sealion test goes well as investors confidence in Rachel will improve hugely.

Evolution note out today, in part:

Scream if you want to go faster
The 2010/11 Falkland Island drilling campaign has started off with one
major oil discovery, a non-commercial gas discovery and two dry wells.
We expect the area to continue to attract investor interest: there are at
least three more wells to drill in the North Falkland Basin, flow testing is
ongoing at the Sea Lion discovery, and there is potential for Borders &
Southern or Falkland Oil and Gas to contract a drillship to expedite
activity in the deepwater South and Plateau Basins. We initiate coverage
on Argos (BUY, TP 52p), Falkland Oil and Gas (BUY, TP 248p), Borders &
Southern (NEUTRAL, TP 101p), Desire Petroleum (BUY, TP 136p) and
Rockhopper (NEUTRAL, TP 359p).
It has been an encouraging start to exploration in the northern part of the North
Falkland Basin where Argos, Desire and Rockhopper operate. Rockhoppers Sea
Lion oil discovery has proved the potential for commercial oil fields (analysis of the
1998 drilling campaign having concluded that there was an active hydrocarbon
system present). News from the southern part of the Basin, though, has been less
optimistic the Ernest wells failure to encounter hydrocarbons has called into
question the areas prospectivity.
The South Falkland and Falkland Plateau Basins to the south of the Falkland
Islands are far less developed, and so far only one well (the unsuccessful Toroa
prospect) has been drilled. The remaining prospects will require a deepwater rig to
be contracted, something that is being worked on by Falkland Oil and Gas partner,
BHP Billiton, and by Borders & Southern. The lack of wells and data make drilling
in these Basins higher risk than in the North Falkland Basin but this is offset by
larger potential prizes, with prospects generally surpassing 1 bn bbls each.
Valuation
While the Falkland E&Ps have historically been grouped together, there is a clear
distinction between those operating in the North Falkland Basin and those in the
Southern Basins as these are geologically different areas with differing risks. While
we see upside for all companies we have grouped the companies by area and then
based recommendations on where we see greater relative value. In the North
Falkland Basin, we prefer Desire (Buy, TP 136p) over Rockhopper (Neutral, TP
359p), owing to the formers leverage to near-term drilling. In the Southern Basins
we prefer Falkland Oil & Gas (Buy, TP 248p) over Borders & Southern
(Neutral, TP 101p) owing to its mix of play types and more attractive valuation.
Argos (Buy, TP 52p), is at a less developed stage than the other four but operates
in the right postcode and appears a low-cost entry route into the prospective
northern part of the North Falkland Basin.

Latter part is complete crap.....DES comes up dry and check out the redundancy package !...

Rf, IF DES comes up dry. It's all about evaluating risk, hence their expression 'near-term drilling leverage'. If DES hits oil then the sp will rocket. RKH have already hit oil so the potential upside is less than that of DES.

Not with the market cap at 400 million quid.....it can hardly be valued more with a smallish discovery.....I mean a discovery of a certain size is already in the sp......imagine the situation that RKH flows are ok....right RKH's sp shoots up (hopefully for me anyway) by a pound let's say....DES shoots up by 30p....right,... now Desire spuds the next well and they come up dry.....it's a strong possibility...RKH's sp remains right up there apart from some profit taking...but DES's will be back down at 50p or so....what's going to keep it up at 120p or so with a market cap of 400 million....it's just not going to happen....so a heck of a lot rests on this next well.....after RKH's tests : that's if you are online when the results come through...I would sell.....just my opinion....

RF stop bleeting on because you dont hold Desire shares any more move on.

hot chocolate and bed for you rf.....

the sp will be very volatile over the next few weeks I guess as optimism over the coming drilling and then fear grows of a dry well and so on. I have been holding for donkeys yrs but wouldnt buy right now, wait until result of first well then add imo

Hey !....I can easily come back in and haunt you...hoooo...hoooo......

About time it reached out for 1.30

Chav you enjoying the sunny weather? still good for the kite flying i see.

Not overly flash for kite flying lately Marky but the sun has been shinning with the odd shower thrown in....not a lot of flesh too put on your bones I'm afraid!