STRATEGY

•FOGL seeks to add shareholder value by pursuing an aggressive exploration programme in its licences to the south and east of the Falkland Islands. Exploration drilling will continue in the deep water areas of FOGL’s licences in the first half of 2012. If successful, this drilling could lead to the development of a new hydrocarbon province in the South Atlantic.

Next Phase of drilling

In the first half of 2012 FOGL is planning to drill two wells in the deep water area of its licences.
FOGL has contracted the Leiv Eiriksson rig to undertake this drilling programme. The rig is due to arrive in the Falklands in early 2012 when it will initially drill two wells for Borders and Southern Plc (B&S), before commencing the FOGL drilling programme. The B&S wells are to be drilled on the Darwin and Stebbing prospects. The results of these wells will be of interest to FOGL, because we have similar plays and prospects within the southern part of our licence area.

The first well to be drilled in the FOGL programme will be on the Loligo prospect. A number of options exist for the second well, including potentially a well on Scotia, a prospect within the Mid Cretaceous Fan Play. The final decision on which prospect will be targeted by the second well will be guided by the results from Loligo.

Funding

As at 7 September 2011 FOGL's available funds, including the BHP Billiton settlement, were $150.8 million. The Company is debt free.


2012 Drilling Programme

The Leiv Eiriksson a harsh environment rig has been drilling wells offshore Greenland for Cairn Energy. That campaign is expected to finish by the end of November 2011 after which the rig will head south to the Falkland Islands. The rig will first drill two wells (about 90 days drilling) for Borders and Southern Plc (B&S) before moving on to the FOGL programme. The transit time from Greenland is expected to be approximately 60 days.

A great deal of work has gone into the planning of the FOGL drilling campaign and over the preceding years a large amount of data has had to be collected to so that the drilling can take place.

Seismic data was acquired from 2004 to 2007 and again in 2011, CSEM in 2007, site surveys in 2009 and 2011 and metocean data, from permanent current meters, in 2009/10. Well planning essentially started in 2009 with the drilling of three, 200m deep, geotechnical boreholes. This data helped with the planning of the shallow section of the Toroa well (FI 61/05-1) and has been extensively used in the planning of the deep water programme.

The first well in the FOGL programme will be on the giant Loligo prospect. A second well will also be drilled by FOGL using the Leiv Eiriksson and site surveys have been acquired over the following prospects: The Nimrod Complex and the Vinson prospect in the Tertiary Channel Play, the Scotia or Hero prospects in the Mid Cretaceous Fan Play and the Inflexible or Endeavour prospect in the Springhill Sandstone Play. Options that are currently being considered depend upon the results of the first well on Loligo. The final play in the FOGL acreage is in the Fold Belt in the south west of the FOGL acreage. This play is being tested by B&S at their Stebbing prospect. Similar features exist within the FOGL acreage and the results of the well will be closely monitored. In addition the B&S, Darwin well is targeting a tilted fault block which again shows great similarities with several prospects in the FOGL portfolio (Inflexible, Thulla etc.). Depending on the results of Darwin FOGL may consider a well on Inflexible as the second well in the programme.

FOGL’s main focus is on the two younger plays, the Tertiary Channel and the Mid Cretaceous Fan play. FOGL has been working on the Mid Cretaceous play for some time but it was only in late 2009, when the seismic data had been fully reprocessed, that it became clear that this major new play was viable. The play is analogous to the ones being successfully targeted in West Africa (the Tullow Jubilee field in Ghana and other discoveries along that margin) and the general geology, depositional setting and even the AVO response (Class II response over Scotia and Hero) are remarkably similar. The two main prospects, Scotia and Hero, both contain prospective resources in excess of 1 billion bbls. One of the key features that makes this play so attractive is that the reservoir sands sit directly above the mature Aptian oil source rocks which were sampled in the DSDP wells to the East of the FOGL acreage.

2012 DRLLING TARGET LOLIGO

The shallowest target alone covers an area of over 600sqkm. The Loligo prospect was first mapped in 2006 and has been re-mapped and re analysed several times since then. It is a large stratigraphic trap which is supported by a very consistent Class III AVO response on the seismic data. It is an ‘easy to map’ anomaly which stands out clearly above the background seismic responses when compared to the entire basin. In addition, it sits directly above an old high which used to separate the Southern basin (Fitzroy sub-basin) from the Northern basin (Volunteer sub-basin). This old high seems to be acting as a focus for hydrocarbon migration from deeply buried source rocks in each of the sub basins.

Beneath the southern part of Loligo several other prospects within the Tertiary Channel play, overlap and may be penetrated by one carefully located well. The deeper prospects (each covering an area similar to Loligo) have been called Trigg and the Three Bears. Together these prospects are called the Loligo Complex. The prospective resources (recoverable oil) associated with the Loligo complex, are in excess of 4 billion bbls of oil or over 25tcf of gas.




FOGL is focused exclusively on offshore oil and gas exploration in the Falkland Islands.

We are pursuing an aggressive exploration programme that could lead to the development of a new petroleum province in the South Atlantic. The joint venture operations have now moved into the drilling phase.
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Most prospects in 2,000 – 4,500 feet water depth (610 – 1372m)

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Target horizons: 6,000 – 13,000 feet below sea bed lever (1829 – 3962m)

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Falklands weather is similar to West of Shetland

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Remote location but there were no major issues during 1998 drilling campaign

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Anchored semi-submersible or drillship for exploration drilling

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Tried and tested technology for developments



Falkland Oil and Gas Limited Licence area.




FINANCIAL SUMMARY http://www.fogl.com/fogl/en/Investors/performance

FOGL HOME http://www.fogl.com/fogl/en/home

http://www.stockopedia.co.uk/content/falkland-oil-and-gas-2012-its-time-63024/

Good volume 2day :) lets hope news soon !

It was on 23rd July 2007 when FOGL announced they were in "advanced" discussions with an unnamed oil major to farm in to their assets following press speculation. Isnt it time for them to put up or confirm there is no deal?

not necessarily; these things can take a long time in gestation, especially when lawyers are involved

How long? They could sign a MOU, but more importantly we need to know which major oil company is interested in farming in? Surely the media can find out if it is true?

not if company security is any good

IMHO news could be any day now (good or bad), and my guess is BHP Billiton, or ConocoPhillips. !!! :) ( well lets hope for news before the sp heads south)

sp certainly behaving very well and suspect some large CFD holdings in this stock too

:))

There is speculation of a consortium That may happen in the Future with the other Falkland oilers, but It will be interesting to see the news on the major when it comes , as its looks to me as FOGL may go it alone to start with, but long term who knows. I would hope to have news soon as there is little support at 160/163 level with out news of some kind !

Oil not all well for Big Energy even at $78 a barrel

Alan Shipman - 11-Sep-2007

As the biggest energy companies struggle to replenish reserves and maintain output, smaller exploration-focused companies hold the key to unlocking new oil and gas profits.

With oil prices rising towards $80 per barrel, these should be good times for the big production companies. But while it helps their present profitability, fossil fuels escalating cost is symptomatic of a longer-term problem. Traditional integrated producers are struggling to replenish their oil and gas reserves, and keep up the flow as large fields go pass their peak. Those based in the EU and North America are also having to share more revenue with, and pay higher taxes to, host governments concerned about their post-petroleum finances, at home as well as in more distant producing regions.
With geology and politics both raising the cost per barrel extracted, most are revising their output projections downwards, and preparing to return to shareholders the profits for which they cant find profitable sites to reinvest. The industrys outlook isnt helped by the present five-country battle for sovereignty over the Arctic, which contains up to 25% of the worlds remaining reserves. So while Shell, BP and others are still doing relatively well on a turbulent equity market, investor enthusiasm is often greatest for the upstream industrys smaller, more regionally or technologically focused players.

Edinburgh-based Cairn Energy yesterday sweetened the announcement of a 17% first-half drop in pre-tax profits by announcing that three new Indian fields will come onstream in 2009, and that Indias government has approved a pipeline to link the first of these (Mangala) with the regions main refineries. Cairn will contribute 70% of the pipelines estimated 400m cost, the rest coming from joint-venture partner Oil and Natural Gas Corporation. The company raised close to 700m through an IPO in India in December, a move which also ensured a return to net profit in H1 despite decline in sales.

Cairn has also been spending on acquisitions, launching a bid this month for AIM-listed Plectrum, which has interests in Tnuisia, Peru and Australia. Cairns oil finds in Rajasthan, although the countrys largest in 30 years, are tiny in comparison with the worlds major fields, which remain concentrated in the Middle East, Latin America and the former Soviet Union. But the profits in smaller fields, and in enhanced recovery from depleted ones, were highlighted by the record 147 applications for new North Sea licences last year.

Among other UK-based niche players, Borders & Southern Petroleum last year raised 15m through a share placement to fund further exploration work around the Falkland Islands. Venture Production this month completed a 585m debt refinancing through private placements following its takeover or Wham Energy, a North Sea player whose interests extend to the major new Buzzard field. And Victoria Oil & Gas this month announced potential new discoveries in Russia, though its latest test drilling in Kazakhstan proved dry.


Taken from Financeweek.

Has anyone put a stop loss in place for this stock?
160p looks to be as far as it wants to go, but if the suspected 'Major deal' doesn't matierialise, then 80p is the next stop, imo. The question is, would a stop loss trigger fast enough if the deal was off?

No stop loss, I got in at 80p but would like to think we will not be seeing that level again for a while ! but agree there is little support at 160/163 level with out news of some kind ! looking at it could be soon ??

I've set a 15% trailing stop loss - if I can catch it in time!

I think you are right to do that, sd. It would be a shame to see all that profit disappear. Might almost be worth paying for a guaranteed stop?

Currrently 170 / 172p.
The top could be anywhere now that 160p has been reached & exceeded.

stunning performance by this stock over the last few weeks, especially considering the general volatility

Are you holding this & shorting NRK, cynic? The Midas touch, or what!!! :o)

i wish! ...... neither i am afraid

I hope you're keeping your eyes on the price this morning, Harrycat and Smiler o!