http://www.falklands-oil.com/

http://www.rockhopperexploration.co.uk

http://www.argosresources.com/




Rockhopper was established in 2004 with a strategy to invest in and undertake an offshore oil exploration programme in the North Falkland Basin. It was floated on AIM in August 2005. Rockhopper was the first company to make a commercial oil discovery in the Falklands. Today Rockhopper is the largest acreage holder in the North Falkland Basin, with interests in the Greater Mediterranean region.

Perhaps I should make things clearer.


PRESENTLY THE SEA LION PROSPECT IS BELIEVED TO BE 806M barrels OF OIL IN PLACE.

OF WHICH 30% IS SEEN AS RECOVERBALE

MEANING 242M BARRELS RECOVERABLE.

RKH HAS 100% OF THIS PROSPECT, SO THE WHOLE 242M IS TO RKH.


If the OIP figure is upgraded from 806M barrels, then the 30% figure also rises.

If the recovery factor is increased from the present 30% then so the recoverable figure rises.


:)

I think I shall do an all in one post so anyone can keep on cut and pasting it, as the questions seem to keep being repeated.

Rockhopper

FLOW TESTS are expected to take 45 days.

The 45 days is due to the tests being extensive. Each of the two zones to be tested will be tested twice. 1st zone tested, then 2nd zone tested, then 1st again, then 2nd again.

This will give them strong data with which they can make further assessments and calculations with regard to the Sea Lion prospect.


The main thing with the flow tests is not the flow rate, its more of the calculations into the "RECOVERY FACTOR".

The present 242M barrels is based on a 30% recovery factor. The upside or downside from the flow test results will be to do with the calculation of the actual recovery factor.

242M barrels recoverable based on 30% = circa 720p a share in the ground basis.

If the recovery factor is lower, say 20% then the recoverable barrels falls to 161M barrels and its value therefore is 480p a share on an in the ground basis.

If the recovery factor is higher, say 40%, then the recoverable barrels rises from 242M to 322M.

322M is worth circa 958p a share on an in the ground basis.

So this is where there is downside and upside from the flow test results. However, all being well, even if the recovery factor is lowered down, the resultant in the ground basis for the share price is still well in advance of the current share price, which is why the share price remains strong even with Ernest failure.


PS :

Presently the OIP (Oil in Place figure) is said to be 806M barrels so 30% recoverable from this gives 242M barrels recoverable as quoted above.

The OIP figure may be raised after flow test and after appraisal drilling (as they have as yet not found the water/oil contact and the structure may be much deeper in other places, hence the need for appraisal to upgrade the OIP figure).

RKH own the prospect 100%, so the recoverable barrels figure is all to the account of RKH.


Feel free to copy and paste as needed in future.

i still suspect that 450 will prove to be an achievable target in the foreseeable future, and certainly sp at the current level would not appear o'valued

cynic you and all of us can keep on guessing till october, your guess is at the moment as good as anybody else.

in that case, it's a pretty good guess :-))

Taking all this in...I reckon on a good flow test plus the potential of more in the ground : another 100p perhaps to be added to the sp prior to Desire's next spud....

Another big question is how much is all this going to cost ?.....a farm in with a big company has to be coming or are they going to sell the lot to BP ?.....RKH is an exploration company and the jump into a producing one takes some doing in 200m of water in the south atlantic !......

RF i have just choked on my cup of tea reading that post 2429.

Steady with the biscuits....well....what do you make of it ?......it raises many a question about where we are heading with this company.....

rf a deal with BLT more of a possibility as they are on the ground in the FI whereas BP trying to lower their international profile hence decision to postpone drilling in Libyan waters.

Some sort of deal has to come along....

rf unlikely a deal will happen until their recoverable reserves are confirmed, they have already calculated that such reserves must exceed 60m barrels recoverable to make the find commercially viable which gives shareholders some idea of the development costs.

Nope, you are a little out. Good flow test results should add around 300p on to the present price, pending of course any further upgrades to size, in which case it would add more.


required field - 21 Aug 2010 09:45 - 2428 of 2434

Taking all this in...I reckon on a good flow test plus the potential of more in the ground : another 100p perhaps to be added to the sp prior to Desire's next spud....

You are a little optimistic........for a 300p increase there would have to be at least a billion barrels in the ground.......I cannot see the stock increasing in value by that much on a single well and test....I would like it to as I have been adding but that seems to me like a dream....

RF, you said similar things at 90p, at 120p, at 180p at 230p and its all very boring now. We all know you are very exposed to GKP but over there you fail to appreciate the fiscal terms of the license (very poor), the license problems, how little percentage of the license is GKP's, the risk and also the fact that GKP appear unable to quote "recoverable" barrels figures and only ever seem, IMO, to quote Oil In Place.

242M barrels recoverable in the ground is worth to RKH (as they own 100% of this) over 700p a share when proven commercial.

You must appreciate that this is in British waters, with no license risk, with excellent fiscal terms and its owned 100%.

From where we are now on good flow tests those 242M barrels are worth over 700p a share, so its very easy to expect from now (just over 300p) to add a further 300p in the weeks ahead and on confirmation of good flow test results.

Of course, any further upside to the OIP to over a billion and therefore to the recoverable oil level upwards from 242M barrels will see those target prices and rises move upwards as well.

This thread is littered with your "its too high" and when it moves up again suddenly you say you are "back in and its cheap" kind of posts........ give it a rest.

i'll stay with 450 being a realisable target in the short/medium term .... medium = next 6/12 months

Give it a rest proselenes...you are boring me....you have got one stock right and it looks like we shall never hear the end of you crowing....danger of becoming a muppet.....the purpose of these threads is to debate the pros and cons of stocks, not permanent ramping !...

As soon as I have any doubts he or she comes on with the ramping....reminding me of when I said ....or might have said that the sp was too high at that time....so bloody what ?.....a profit is a profit when banked.....getting on my nerves now ....so if and mr boaster says the stock will double ...300p more doubling the value to 1.2 billion pounds cap....not bad on a single well.....I just think that an increase by 100p might be more in order or a sharp spike perhaps by 150p and back down by 50p or so but 300p seems a lot...if it does it will make me a lot....this could put the sp up in the next few weeks if the city think along these terms....it all depends on the flow tests.....if tests of more than 20000 barrels per day come up.....blimey....

The sp should rise ahead of the test results, it will be interesting to see how far it will go, with plenty more drilling to come there will be more ups and downs in the next 18 months or so.....but 600p after this first test ?....that would be incredible....

you said it - "600 .... incredible"
settle for 450 and you're more likely to reach your target