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

R-2, according to this one estimate of the new location, looks to be in a pretty prime place.

R-EIS were the original mentioned ones prior to drilling, R-1 is the original well thats just been P&A and of course Rachel-2 is the estimate of where the next one is going.



.

According to the grapevine spud could be from Tuesday afternoon, so an RNS by Wednesday it seems (could be earlier).

Pro they were hoping to move the OG later tonight and it should take a couple of hour to get her to here new spud sight weather permitting,winds not to bad but blowing in right direction.

So RNS soon

Marlon iii

Normally in oil exploration you have a pretty good idea about the size, depth, lateral extent, age and OIP target on a drill.

What you normally have very little idea of is whether oil will be present or not.

Rachel 3 is the complete opposite of this.

It is almost certain that the reservoir encountered with the Rachel sidetrack will be re-encountered, and oil will be present.

However, we have only small clues as to what we are drilling.

It isn't the Barremian 0 top-fan as shown on the prospects map. We are pretty sure, that this will be dry.

So at the new well location, how big are Rachels sisters?

Is one of them Kath, Elaine, Sealion, Sealion lower, Ruth, another, another2.

Which of these are realistic targets and not ruled out by maturity depths and eastern faults?

There is scant data to really help us on deciphering whether we are pursuing a 30mmbs target or 500mmbs+ target. Although we are confident that everything below barremian 3 will be oil bearing!

What an insane position for an investor to be in!!!!

The scant data tells me that Rachel 3 could still be Pyrex...theres lots of high amplitude west of the heavily faulted zone that has not yet been penetrated, but I'm bemused to say the least.

Just sit tight and enjoy the ride. --------------------------------------------------------------------------------

Well, its off and running time with Rachel North.


Desire Petroleum PLC
Rachel North
RNS Number : 8228V
Desire Petroleum PLC
09 November 2010

Rachel North

Desire Petroleum plc (AIM:DES) the oil and gas company wholly focused on the North Falkland Basin, wishes to announce that both regulatory and partner approvals have been granted for Desire to drill the 14/15-2 Rachel North well.

The 14/15-1 well has been plugged and abandoned and the rig is currently waiting on weather to move to the Rachel North location.

The Rachel North well will be drilled vertically with an estimated total depth of 3,050 metres. The bottom hole location will be 1.7 kilometres from the Rachel sidetrack 14/15-1Z bottom hole location. Drilling operations are expected to last around 35 days.

It is intended that this well will evaluate the sands with oil shows encountered in the Rachel sidetrack as well as a number of possible additional sands not seen in the sidetrack.

Desire wishes to thank both the regulatory authorities and its partner Rockhopper Exploration plc for their speedy approvals to move to the new Rachel North location.

A further announcement will be made once the well has been spudded.

sh one t or bust - lol

gl everybody.

Just back up from mine with very light clogs on clip clop clip..

Rachel 3 is about 30 km from Sea Lion,am quiet sure DES hit oil its just a matter of how much and whats in those stacked fans.

This is the bit I like.
'The bottom hole location will be 1.7 kilometers from the Rachel sidetrack 14/15-1Z bottom hole location'.
They must be fairly sure that the initial Rachel drills had indicated that the chances of a commercial find were high. If you were not confident and thought that those initial shows indicated a poor low volume find or even a duster, you would move as far away from that well as possible.
Looking very good, still a big risk, but the percentage of risk factor must be far lower than pre Rachel, when the sp was higher than its current level.

Well, blow me away but I have just purchased a long position in DES.

Why, well, there is a top seal, a side seal and this side of the side seal they know there is oil. They are also going to target some of the lower fans as well.

All in all, I do not think they can miss oil this time, and so, I now have a long position. Goldman Sachs remaining positive also assisted in the needed confidence to take a long in DES.... ;)

WTE holding Desire Petroleum Plc - 2,650,000

just a matter of time now

RNS tom saying they have spud and will take 30 days but i will plum for 15 to 20 days if good weather.

Am quietly confident that some thing will be found on this drill,3 rd time lucky.

Glad am down the mine with 70 mph gusts.....clip clop

should have been in Nice today ..... glorious sunny day and certainly warm enough for lunch outside

Rachel North 14/15-2 Well Spud



Desire Petroleum PLC (AIM:DES) the oil and gas exploration company wholly focused on the North Falkland Basin, is pleased to announce that the Rachel North 14/15-2 well was spudded at 10:40 hrs (GMT) on 12 November 2010.

Interesting to see where the sp goes now. Got it totally wrong last time news came out!

Summary of the GS note :

http://www.proactiveinvestors.co.uk/companies/news/22966/falklands-oil-exploration-will-be-an-important-focus-in-near-term-goldman-sachs--22966.html


Falklands oil exploration will be an important focus in near term Goldman Sachs

Friday, November 12, 2010 by Jamie Ashcroft


Goldman Sachs believe that the Falklands offer the best regional value

The Falklands will continue to be an important focus for European exploration and production (E&P) oil and gas investors in the near term, according to research by Goldman Sachs.

Goldman singled out the headline grabbing frontier play in a comprehensive note to clients, entitled: 50 E&Ps to change your portfolio.

Many investors will have been familiar with the key players since the group of companies clubbed together back in 2009 to take the Ocean Guardian drilling rig out to the remote area in the South Atlantic.


So far the North Falklands basin has been the most explored with Rockhopper Exploration (LON:RKH) and Desire Petroleum (LON:DES) drilling through most of 2010. The South Basin has been actively explored by Falkland Oil & Gas (LON:FOGL) this year, and Borders & Southern (LON:BORS) has plans to take a rig out there in Q4 2011.

There has also been a new addition to this hardy group of AIM oil explorers in recent months, with the listing of Argos Resources (LON:ARG). The company has been described by the cognoscenti as the last remaining entry into the Falklands because its assets are comparatively early stage meaning it still has some catching up to do with the rest of it peers.

Argos expects to start drilling in 2011.

Goldmans research was led by analysts Christophor Jost and Ruth Brooker.

Jost and Brooker claimed that the Falklands offer the best regional value among the various investment themes in the report.

On our estimates, the Falklands is the cheapest area, despite the good performance relative to the rest of the sector over the past 3-4 years, the analysts said.

That said, Goldmans analyst team highlighted that the 4 main explorers had been out-performing the rest of the sector even before a well was drilled in the south Atlantic.

The Falklands explorers saw c.75% relative outperformance vs the sector before drilling, Jost said.

The analyst added: The anticipation has proven justified in the north where Rockhoppers Sea Lion discovery has opened a new potential play, although the failure at Rachel highlights that risks remain.

Whilst the North Falkland basin has been the main focus of attention in recent months, Goldman emphasised that the trickier deep-water South Falkland basin may hold greater potential.

Despite FOGLs disappointment at Toroa, the southern basin offers higher potential upside than the partially de-risked northern play but with a higher geological risk,

Given a combination of high impact exploration and a proven basin in the north, we expect the Falklands to be an important focus for the European E&P investor in the near term.

We see value in all the Falklands players under our coverage ... all Falklands explorers look cheap on our estimates, the analysts wrote.

Although the re-rating potential is vast, the outcome is binary in the event of the basin being successful, the companies will re-rate, but the downside in Borders and Southern and Falkland Oil & Gas is large in the event of failure.

In reference to the North Basin the analysts add: Now that the Sea Lion discovery has flowed, the risk profile of the stock has reduced, in our view, and it is no longer such a binary call as its peers to the south,

Instead, we believe that the value is a result of the markets inefficiency in pricing in the value for the potential of a newly opened play.


Borders and Southern (LON:BOR)

The Goldman report - written before Borders and Southerns drill programme was set back until Q4 2011 - began coverage on the South basin explorer with a buy rating and a 12-month price target of 104 pence.

The analyst said that the high-risk, high-impact exploration has the potential to transform the stock. Once underway, two wells will be drilled.

In the event of the two prospects being totally de-risked, we believe that the stock could re-rate upwards to the tune of over 1,500%,

Failure, however, would result in significant downside in our view (potentially as much as 85%) unless there was sufficient encouragement for follow-on wells.


Falkland Oil & Gas (LON:FOGL)

The analysts said that the Falkland Oil & Gas story is not dead, as it initiated its coverage with a buy rating and a 12-month price target, of 200 pence, that implies 96 percent upside.

Falkland Oil & Gas was the first to break ground in the frontier play, and the unsuccessful Toroa well which failed to find any hydrocarbons - prompted farm-in partner BHP Billiton (LON:BLT) to pull out of the next exploration phase.

Goldman believes the stock is undervalued ahead of the next well.

The key catalyst will be the next well at Loligo success or failure will be the key driver of share price performance.

The analysts believe that success at Loligo would re-rate Falklands Oil & Gas.


Rockhopper Exploration (LON:RKH)

Goldman highlighted that the Sea Lion discovery fully supports the current share price. The analysts initiated its coverage with a Conviction Buy rating with a 12-month target set at 640 pence .

They believe that the Sea Lion discovery offers a significant opportunity.

The analysts expect exploration and appraisal drilling to be the key share price catalysts.

We believe that Sea Lion has partially de-risked the basin, meaning that Rockhopper has high visibility on a potentially transformational pipeline of lower risk drilling catalysts,

We believe that further appraisal drilling on Sea Lion could help to reduce the commercial risk on the asset and potentially increase the estimated volume of reserves.


Desire Petroleum (LON:DES)

Goldman began its coverage on Desire Petroleum with a buy rating and a 12-month price target of 197 pence.

We believe that Rockhoppers Sea Lion discovery has helped to de-risk Desires substantial acreage in the north eastern part of the North Falklands basin,

Desires acreage in this part of the basin amounts to over 1000 sq km giving it substantial running room to drill a significant number of potentially transformational wells over the next few years.

The analysts believe that successful exploration could increase Desires valuation by 6 times, however they cautioned that the downside could be close to 100 percent if no further discoveries are made in the basin.

Nevertheless the analysts state: We believe that the market tends not to be aggressive enough in valuing new basins after the initial discovery, and while we appreciate the risks involved, we are willing to give Desire value for exploration drilling out to 2013 in the area.

When GS says BUY, it's a SELL.

Go on then Hlyeo, you claim to have shorted before and got it wrong, time for a second go?

Nice interview to watch :


http://www.proactiveinvestors.co.uk/companies/stocktube/590/gill-leates-of-jm-finn-says-oil-around-the-falklands-has-the-potential-to-far-exceed-the-north-sea-.html


Gill Leates of JM Finn says oil around the Falklands has the potential to far exceed the North Sea

Wednesday, November 17, 2010


Gill Leates, manager of the JM Finn UK Smaller Companies Fund, confirms that the potential for opportunities in the waters around the Falkland Islands could be as much as 60bln barrels of oil, however it's likely to be sometime before it's proven. Gill also said that the outperformance of small caps over larger cap stocks is likely to continue as innovative companies produce good earnings growth.

http://www.proactiveinvestors.co.uk/companies/news/23114/broker-roundup-desire-petroleum-petroceltic-kenmare-resources-medusa-mining-african-aura-23114.html


........Westhouse Securities analyst David Hart has re-evaluated Desire Petroleum (LON:DES) after the mixed results of the first Rachel well in the North Falklands basin.

The Rachel prospect has certainly had its share of ups and downs over a relative short period of time, Hart said.

As a result, we have also adjusted our risk assumptions for making a discovery to reflect events as they unfold.

The analyst has upped his price target to 121 pence and reduced his rating from buy to accumulate reflecting the gap from the current price of around 107 pence.

Clearly, success with the Rachel North well will result in an upgrade to our target price, Hart added.......