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.
•
Most prospects in 2,000 – 4,500 feet water depth (610 – 1372m)

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

•
Falklands weather is similar to West of Shetland

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

•
Anchored semi-submersible or drillship for exploration drilling

•
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/

Yet more movement from one of the Falkland Oil Crew Companies.

Rockhopper Exploration, the North Falkland Basin oil and gas explorer, is pleased to announce that it has agreed terms with a third party energy company for a farm-in to one of the Company's licences, through a contribution, at a promote, to the costs of drilling one well on the licence and to certain back costs. A Letter of Intent to farm in has been signed and discussions continue to progress the agreement this into a fully binding joint venture.

Now I wonder if this will end up like the bus stop syndrome. You seem to wait for ages for one to come along, then what happens, three or more come at once.

As reiterated in todays press, the oil majors such as Shell, BP, Exxon and the like are still desperate to boost their inventories, mainly due to the fact of low oil reserves on their books, but also due to intentionally over estimating for the last fews years in order to enhance their share prices.
As the Falkland field possiblefinds are being talked about in the same volume category as the BP and Chevron recent finds in Mexico how long will it be before the minnows such as Des/Fogl/Rock and the like are taken over.
IMHO the question won't be so much if as when. Will they wait till oil is pumping in sufficient quantities and risk loosing out to a competitor that jumps first or chance getting in on the ground, IE now.
Both strategy are a risk but which once will they take.

http://www.falklandnews.com/public/story.cfm?get=5504&source=3

A tight rig market could delay Falklands drilling in 2010
September 28, 2009
by J. Brock (FINN)

Could a tight rig market delay Falklands drilling programme in 2010?

By J. Brock (FINN)

A buzz word rig - permeates the Falklands exploration industry but it would be a tight rig market that could postpone Falklands exploratory drilling in the South and East Falkland Basins.

Richard Liddell, Chairman of FOGL, has conformed that a rig has not been sourced for drilling in the deeper prospects that the company has in the area. He said, "Our partner, BHP Billiton, continues to seek a suitable drilling rig for a drilling programme currently scheduled for 2010, in line with our previous guidance. With the necessary preparatory work completed and funds available to secure long lead drilling equipment, we are well placed to move into the next exciting phase of exploration."

Were almost ready and everythings there but the rig. One of the final hurdles an environmental impact assessment is due to be submitted to the next meeting of Executive Council, scheduled to take place in early October. Once this is approved the South and East Falklands Basins are that much closer to the all important drilling round.


The rig market has been tight for several years now since the price of crude nearly hit $150.00 per barrel in 2008. Exploration companies signed contracts for extended periods of time and even kept exploration rigs for production. A few rigs have come on to the market but they are not suitable for the prospects to be drilled to the south and east of the Falklands where water depths are more than 1,000 Metres deeper than they are in the North Falklands Basin.


The best option is to get a rig or drill ship that is fit for purpose. BHP Billiton will make sure this is the case. Newer rigs on the market can do the work but it is an expensive option with prices of $500,000.00 to 750,000.00 per day (approximately) for drill ships and newer adapted rigs.


Fewer rigs have been constructed in the past few years. Those that were constructed were snapped up by exploration companies while still being constructed.

It is expected that the right rig or drill ship will be in operation in FOGLs prospects in 2010 but in this business delays sometimes long ones happen regularly.

Our ears to the ground. Watch this space.

Both wells will be Plugged and Abandoned regardless of what they find.



http://energy.rpsgroup.com/Public/bhpbillitonEIS/

Page 16:

Of the two wells proposed by BHPBP(F)C within the East Falklands Basin, the first well will test for oil in two target levels at the Northern Tranche Late Cretaceous Loligo Prospect. The second well will test for oil and gas in two target levels at the Southern Tranche Early Cretaceous Toroa Prospect.

It is likely that the proposed exploration wells will be drilled using a semi-submersible drilling rig,with an 8 to 12 line mooring anchor pattern. Start dates for the drilling of the wells will be determined when a suitable rig has been secured.

Operations at the well sites are expected to last up to 75 days and. water-based muds (WBM) will be used to drill the wells.

Following drilling, the wells will be logged and evaluated. Following evaluation, the wells will be plugged and abandoned regardless of the results of the evaluation.

FOGL and DES are partners in at least some fields, yet the above would seem to contradict the posts on DES of +/-15th October, wherein DES had apprently already obtained rigs.

these stocks are a markymar speciality, so no doubt he will elucidate.

as it stands, one could expect FOGL to be seriously walloped (15/20p?) on monday (general market sentiment apart), dragging DES and others in its wake

So what happened today to push FOGL north by 10%?

Was it this?

Link
Seems small beer by my reckoning.

From iii morani

Hi all,

I post this here as to the implied implications re OG towards the end.

The following is a personal account of the BHP Billiton Petroleum EIS presentation in the Chamber of Commerce FI, Thursday 19th November for the offshore exploration planned to take place to the SE of FI. Same caveat applies as previous RKH and DES posts regards unintentional inaccuracies for which I apologise.

There were not as many people as were at RKHs EIS presentation, but conservation, councillors, former councillors, members from the British military, local business and a few outsiders were represented or present.

The BHP representative was called Scott Sanders and he came around and introduced himself before the meeting began. He gave the presentation, but unlike the lengthy, though very informative RKH presentation, gave only the key points of the lengthy report, which was prudent IMO. There was also a Fay Dobson of RPS also present.

Scott started by giving a bit of background knowledge of the BHP and said they hope to do another 25 exploratory wells in the next 3 years and in 12 countries. BHP Billiton Petroleum (Falklands) Corporation currently holds 14 exploration and production licences offshore the FI in the South Atlantic after signing contracts with FOGL. BHP holds a 51% interest in the acreage and is the designated operator. The remaining 49% is held by FOGL.

BHP plans to drill two exploration wells (Loligo and Toroa) in the PL028 and PL015 license areas. Loligo is 225K east of Stanley and Toroa is about 145K. They have been collecting data for about a year and Loligo is the deeper of the two at about 1500m whilst the other is about 600m. It is Toroa, if I understood correctly, where they are experiencing oil seepage. He said at the depth it is, they are getting a lot of gravel type and indicating low carbon levels but the seepage would be from natural occurrences and there is little or no fishing or other shipping activity in the area. When I quizzed him about the seepage later, he said it was highly likely that it was seepage from naturally occurring faults and was not an indication of an abundance of oil necessarily. They do occur naturally but if another rig had been drilling or it was leakage from a ship or whatever, they could take samples and do what he called a DNA of the sample and get its 'finger print' to match which rig or ship it could have come from. He also talked about the mud being used which is 90% water and bentonite(?oil experts?) which is very low in toxins and chemicals; in other words as natural and environmentally friendly as they can make it. He also said recovery time would be 2-3 years at most. He talked about leaks and regulations pertaining to leaks or spills and how we may handle them with our own regulations in place and others in UK that could be followed too. He said leaks were usually due to poor maintenance and showed charts that proved they were in the top 10 companies for zero accidents or fatalities. Health and safety had to come before any financial rewards and they had a very good track record having had no spills in 3500 wells between 1997 and 2008. Not sure if that was no spills or no major spills. Flaring could also be another source of leaks. He was adamant that transfers had to be watched closely. Like RKH, they had a leak scenario and had taken the best possible advice which gave reason to believe that with wind and current, mainly wind, they would have 80hrs to get their plans into action before the oil reached our shores; it was in fact more likely to be taken away from the Islands than towards it.

There was a question about regulations for checking all their procedures and Scott said the checks start before anything else and regulation checks would be made on any rig (semi submersible) or drilling ship that they would be using before anything was signed or commenced and followed through at every stage.

Another question from a member of the military enquired as to when any action was likely to take place but Scott did not really give an answer as BHP have not signed any contract yet with the rig that is coming (quote unquote) or with anyone else as they have to be satisfied it will do the job they require of it, and it meets all the regulations, then BHP would secure permits, etc. The questioner went on and asked if they could give a time scale where nothing would happen and Scott said nothing would happen for at least 2 months at the very earliest. The rig had to get here and they had to sign in to it or identify some other rig or vessel and get their permits, etc. There then followed some discussion where Stephen Luxton pointed out that other companies may commence work earlier as the rig was about to leave UK, to which the individual from the military said he was well aware of their plans and timings.

There were some further environmental questions from an individual with connections to South Georgia who, I think, had done a lot of scientific work with BAS in the area. There was also a South African, who also asked some questions concerning conservation issues, but I failed to write their contributions into my notes. Most people left as soon as the meeting ended.

"FOGL announces its intention to conditionally place 43,478,261 new ordinary shares of 0.002 pence in the capital of the Company ("Ordinary Shares") at a price of 115 pence per share to raise 50 million before expenses (the "Placing"). The net proceeds will be used to fully fund FOGL's share of the costs of the planned drilling programme.

FOGL also announces that the joint venture between BHP Billiton and FOGL ("the Joint Venture") is in advanced discussions with Desire Petroleum plc ("Desire") to contract the Ocean Guardian rig to drill the first ever exploration well in the East Falklands Basin. Whilst discussions have reached an advanced stage, there can be no certainty that the Joint Venture will contract the Ocean Guardian. The Joint Venture intends to contract a deepwater rig for late 2010."

http://www.upi.com/Science_News/Resource-Wars/2009/12/10/Falklands-woo-Chilean-oil-companies-to-speed-up-exploration/UPI-34211260484632/

Falklands woo Chilean oil companies to speed up exploration

STANLEY, Falkland Islands, Dec. 10 (UPI) -- Falklanders' hopes of an imminent oil bonanza have received a boost after senior executives from a major exploration and production firm on the islands were reported in talks with Chilean oil companies to try and forge strategic partnerships.

Falklands Oil and Gas Ltd. is seeking Chilean partners because of Chile's
geographical proximity with the British dependent territory.

Industry analysts said the Falklanders' quest for strategist partners in Chile was a logical outcome of reports that the islands' basins have vast hydrocarbon resources that need to be exploited at speed to make the most of the current trend in oil prices.

There was no immediate indication if Chile would respond positively to the Falklands' overtures or would pass on the offer so as not to upset neighbor Argentina, which fought a war with Britain over the Falkland Islands in 1982. Argentina still claims sovereignty over the islands.

About 162,000 square feet of the islands' basin region in the South Atlantic is ripe for exploration. Scientific surveys have established vast reserves that could transform the islands into a major oil-producing region.

The current trend in prices is also conducive to attracting investors into the exploration project. However, if the prices drop amid continuing doubts about a global economic recovery, potential investors will have less incentive to get interested in an expensive drilling program.

FOGL's first port of call in Chile was the state-run Empresa Nacional del Petroleo, which, according to industry experts, has the expertise and resources to enter into a large-scale oil exploration partnership abroad.

ENAP made no comment about talks with FOGL Chief Executive Officer Tim Bushell, who visited the Chilean oil company officials in October.

FOGL sources said the Falklanders believe ENAP is the natural partner for FOGL because of geography and logistics.

ENAP already has successful gas operations in the Magallanes region, Chile's extreme south, and after 2008 losses of about $958 million is desperate for a turnaround.

ENAP lost heavily on importing expensive crude oil for its refining operations, so having Falklands oil in closer proximity will be an attractive prospect, analysts said.

FOGL has also made overtures to other oil companies in Chile but apparently not yet in Brazil, which has extensive experience in undersea drilling and also has cash to spare for overseas projects.

Meanwhile, Desire Petroleum said it planned a share issue of about $34 million to make use of the full potential of its exploratory drilling season, scheduled to begin in February 2010 with the arrival of the rig Ocean Guardian from Scotland.

Desire recently raised 40.2 million pounds by placing 60 million new ordinary shares. The funds, together with Desire's other cash resources, are designed to enable Desire to drill at least four wells.

Desire said it would use any surplus funds to test any successful wells or drill more wells.

Two other oil companies operating in the Falklands, Arcadia Petroleum Ltd. and Rockhopper Exploration Plc, are expected to drill two wells on their own initiatives. Arcadia is operating within Desire blocks and Rockhopper is active outside of Desire blocks.

The combined exploratory ventures mean that eight of 10 designated wells are now accounted for.

The Falklands government has said it will monitor the drilling operations closely to guard against damage to the islands' ecology, a source of tourism revenue.

Falklands Oil And Gas FOGL..... been doing the busines for a few days now. Was very suprised to see that the stock has a Beta (this is a oiley) below 1, in fact 0.7 so that suited me to the ground. Im not very keen on fast moving stocks.

Hi Goldfinger
,
The reason its a fast moving stock is that the Ocean Guardian will be spuding in the NFB about this time next month and it has been suggested The first two wells are expected to be on Liz and Sea Lion. This will be followed by a well on Toroa on Falkland Oil and Gas's* (FOGL) acreage with a rig agreement currently being finalised between Desire and BHP

So if they can come to a suitable agreement with Desire to use the rig you should be drilling between May and July.

It has also be suggested by Oriel that Toroa based on pre-drill estimates of 1400mmb would be worth c3400p/sh to FOGL
Now what i would like to see as part of Desire lending FOGL the rig is a percentage in the Toroa prospect.

I believe there are a few meeting going on this week and hopefully more news will be for coming soon.

Spot on Marky - except I don't think DES is 'lending' the rig! They are paying the going rate - and some - if indeed the DES / BHP deal is struck.

Given FOGL's innovative approach to the Chileans I think they deserve to keep what they find!

Hi marky,

re.. market movement

in fact its a slow moving stock with a beta of less than 1 so that attracted me to it.

Being a short term trader and not usually an intraday trader I dont go for any stocks over a beta of 1 which way outperform the market up and down.

So I was chuffed when I saw it had a beta of just 0.7 and reckon a lot of others have appreciated this.

cheers mate.

Broker BUY out late yesterday not much to go on though but a buy is a buy is it not. (link from hemscott premium)

Falkland Oil & Gas Ltd

FORECASTS
2009 2010
Date Rec Pre-tax () EPS (p) DPS (p) Pre-tax () EPS (p) DPS (p)

Oriel Securities
12-01-10 BUY

From FT today: "at a Falklands OIl & Gas meeting yesterday Mike Bushell said BHP intent on sending a drill ship from west Africa or a semi submersible"

Avsec you quiet right about the word lending ....borrowing the rig on favourable terms for Desire meaning maybe a percentage in the prospect and cash.

Gold finger what is your graph telling you about Desire Petroleum as i can see 1.25p + by end of week.

Harry i bet he didnt give a date?

Marky, give me a hour or so and Ill post it up. (des)

Funnily enough got it across the road in my 2 top stocks for 2010.

cheers mate.

Glad I stayed in this, one with a positive future me thinks ! ; ))

dummy's 5-year chart indicates probable resistance imminent at/around the high-spikes