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

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

Hi all

Looks like we might get a bounce up off the 0.53p. The support for this level for this price starts on 17/11/04 & goes through to 10/12/04. The fact that the bears have not managed to push DES back bellow Fidays high could well indicate a bounce from this level. The next move up from this level may well be quite a move. In November between the 10th & 13th DES moved 0.06p. I hope this is the case for tomorrow !




Good Luck All

Eddie

Hi all

Another reason DES may show support today is. As I read it. The placeing of the shares are with institutions and the share holders. I take this to mean you've got to be in it to win it ! (1 for 8) So lets hope we see our support !


Good Luck All

Eddie

Showing a bit more support this morning eddie, looks like the theory could be holding out. The short termers T+10ers and those looking to top slice probably have closed out now so the momentum should be upward!

http://www.oilvoice.com/m/uploadDetail_public.asp?upload_ID=3277


Rockhopper Exploration, a new UK-based oil exploration and production company, has announced the signing of a memorandum of understanding with Desire Petroleum plc to farm-in to three wells to be drilled on Desires acreage in Tranches C and D offshore the Falkland Islands.
It is anticipated that the drilling programme will begin within about a year. As a result of its planned contributions to Desires exploration costs, Rockhopper will earn an interest in the licences of 7.5 per cent, with an option to increase that stake by up to a further 7.5 per cent by October 2005.
Rockhopper Exploration, formerly known as Crude Oil and Gas Limited, announced in December that the Falkland Islands Government had awarded it two exploration/production licences, PL023 and PL024, covering an area of 4,203 square kilometres and located 50 kilometres to the north of the Islands in the North Falkland Basin.
Pierre Jungels, Executive Chairman, commented: This agreement will enable us to accelerate our exposure to drilling opportunities in the North Falkland Basin, and broaden our portfolio significantly. We look forward to working closely with Desire as we move towards the drilling programme itself.
This farm-in agreement is another step, further to our recent licence awards, in creating an exploration play covering substantial parts of the North Falkland Basin. In addition, we continue to pursue other ways of building our portfolio by accessing further acreage both through negotiation with other licence holders and applications to the relevant authorities.

Hi all

Lets look at the intraday chart. We had a slow start to the morning, then for rest of the day the bulls have given support. What is good is DES has finnished on the high of the day. No long thin lines on top of the main body. All being well the support should be there again tomorrow.





Any thoughts anyone ?


Good Luck All

Eddie

http://www.thisisnorthscotland.co.uk/displayNode.jsp?nodeId=149235&command=displayContent&sourceNode=149218&contentPK=11836822&moduleName=InternalSearch&keyword=desire%20petroleum&formname=sidebarsear


Meanwhile, oil and gas explorer Desire Petroleum saw its shares jump more than 6% to 56p after it said 3D seismic had identified large oil prospects in the North Falkland Basin.

It said the targets had the potential to produce more than a billion barrels of recoverable oil, and it was making preparations for a three-well drilling programme.

Desire now aims to raise up to 25.15million through a placing of shares and open offer to take its Falkland Islands exploration forward.

The company has also announced an agreement with new UK-based oil and gas company Rockhopper Exploration under which Rockhopper will earn up to a 15% working interest in Desire's exploration licences by funding up to 30% of the costs of the drilling.

Desire added that the new 3D seismic and existing 2D seismic had identified prospects with more than two billion barrels of recoverable oil. It said the fundraising would allow it to move more rapidly to commission a rig, and that drilling was likely to begin towards the year-end.

Hi Eddie and All

Good call yesterday and the share price has risen i think the people who sold some of there shares now to buy the ones at 45p have done that and we should see the price start to tick up.

ENN had a good day Eddie

Regards all

Markymar

Hi markyamr

Nice one !

Drilling to start sooner than I thought. That should get the price moving !

Kind Regards

Eddie

An update on the rockhopper web site about the Farn-out deal, they state we should be drilling within 1 year .

http://www.rockhopperexploration.co.uk/press/rockhopper050216.pdf

Hi all

The candles that we see from Friday last to todays, are in a short term up trend. This could change tomorrow, if we have another increase. The last two candles that we have, had lows of 0.525p. This is called a tweezers bottom with peircing pattern. If DES goes up tomorrow then we have confirmation of this being the bottom. The resistance is at about 0.60p, so the risk vs rewards are stacked in favour of reward ! So all being well DES should rise again tomorrow. If DES goes through the 0.60p we will have a break out ! This will be absolutly FAN-tastic !

DES is now sat above the 10 day moving average !





Thanks markymar, ehall


Good Luck All


Eddie

Well I take no pleasure in saying it but I did tell you so. This share is a dog with fleas. It is fanciful to imagine the share price shooting up into the stratosphere of new found wealth but the plain fact is it will never do so. It has a history for disappointing and I fear that trend will continue for quite some time yet. My advice, and good advice it most certainly is, is to bail out now -while the price is still over 50p. It wont be there too much longer!!!

If you want a share that will make you money try Kenmare Resources (KMR). It has a solid business model with sound infrastructure and brilliant forward earnings potential.