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/

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!

177.5 likely to prove an obstacle as that is all time high from a year or so back

This is hype/news driven at the moment, so my fear is that once the news of the deal (or not) is out, the sp will settle back, as actual drilling & extraction is a long way off. But enjoying the ride so far, so no complaints!

Quite !!

Small Talk: BHP in the frame to take Falklands stake
By Andrew Dewson
Published: 17 September 2007
Companies have been prospecting for natural resources in the vicinity of the Falkland Islands for what seems like an eternity, and so far at least the results have been about as tempting as a winter holiday at Goose Green. However, some well-informed corners of the City believe that the situation is about to change radically for at least two regional players.

The word is that Falklands Oil & Gas is poised to confirm that it has agreed a "farming-in" deal with the world's largest integrated mining group, BHP Billiton. Farming-in occurs when an exploration and production company invites a partner to share in the development and funding of a prospect.

The company has already confirmed that it is deep in negotiations with several potential blue-chip partners about a farming-in arrangement, and as a result the shares have rocketed from below 75p to Friday's closing 157p over the past two months. However, a deal with as prestigious a partner as BHP should see even more punters pile into the shares.

Although best-known as a mining stock, BHP has extensive oil interests, and expects several of its prospects to come into production over the nextsix months.

Many observers have been highly sceptical about the prospects for significant and more importantly economically viable finds in the South Atlantic. Not only is the environment one of the least hospitable anywhere in the world, requiring deep sea rigs capable of working in the roughest seas, the Falklands is a long way from any major oil market. But with black gold hovering at close to all-time highs, in absolute terms at least, perhaps now majors are set to take the region more seriously.

Elsewhere in the Falklands, recent newsflow has not been so good. Falklands Gold & Minerals confirmed that its drilling programme has failed to find commercial quantities of gold at Bluff Cove. The company still has 3.5m of cash, and the rumour is that it is considering a move even further south into Antarctica, to be precise. How many geologists will be queuing up for a slice of the action is hard to tell there is no shortage of demand for qualified geologists, and most locations don't require living life in the freezer.

http://www.britishbulls.com/StockPage.asp?CompanyTicker=FOGL&MarketTicker=Oil%20and%20Gas&TYP=S

FOGL

BUY
CONFIRMED

Interesting week ahead :)

18 Sept

LOCAL DEVELOPMENTS:



There is a positive buzz in the Falklands and the visit of Oil Company representatives is seen as a very important event for Falklands businesses. The representatives will be giving presentations at the Chamber of Commerce and there will be an opportunity to chat with them about a variety of options. It is expected that the Falklands will see an exploration rig sooner rather than later.

Smiler O,

When I read reports direct from any Falkland Island Officials, the main thing that strikes me is the lack of political speak. They don't prevaricate as our officials would. Most reports appear to be direct and straightforward, so when it says, "It is expected that the Falklands will see an exploration rig sooner rather than later", the sooner bit is the bit I like.

Yes greekman, I think its just a matter of time :)

Which oil company representatives, anybody know?

This might be relevant:

LONDON (Thomson Financial) - Rockhopper Exploration PLC said it has agreed to relinquish 50 pct of the licences PL023 and PL024 to the Falkland Islands Government, as was anticipated when the licences were granted in Nov 2004.

When the relinquishment takes effect in November, it will successfully retain all the leads and prospects that have been identified during the technical evaluation, the oil and gas explorer said.

The company also said Phase 2 of the licence is for three years starting Nov 2007, during which time it is committed to drilling a single well between both licences.

'Ernest is a high quality prospect with the chance of finding hydrocarbons set at 40 pct,' said managing director, Sam Moody.