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.

Here is another thought not only have they hit oil and its looks like it is a very large find of more than 200 million barrels plus they have already classed the Johnson prospect drilled with the 14/5-1 well could contain contingent resources of 7.9 Tcf of recoverable gas reserves which is a huge find as well which must also put a value on Rockhopper..its just looking better all the time and am thinking of adding more.

see Johnson prospect on map

Does anyone no how much the gas is worth ?

m
this isnt the best place to top up or add more, in my opinion. dont be greedy.and please try not to encourage in new buyers without at the same time outlining and stating the high risk involved to them. thank you.
regards
jkd

It will be interesting to see how TFC played this one.

looking at the left hand chart in header we have a high plus 3 lower highs. that isnt considered good in chartist terms.dont make it a short though. not a buy until it breaks up through the original 92sh high and stays there. bit like DES, only over there it is 132sh or so.
i rest my case. could be wrong .just my own opinion and as always please dyor.
regards and good luck
jkd

I wonder how many so-called investors / traders shorted CNE on it's first major discovery. As I recall the SP was approx 350p when it hit, don't think it even doubled the first day, but eventually reached about 30 within a relatively short period.

pth
seems we agree then.based on "dont make it a short though". ermm , sorry what was your point? do we agree or not? bit confused on this one. is this rockhopper you are discusssing?
regards
jkd

The implications are massive, and yet people just talk about "stock price" and shorting.

This well has proved "good reservoir" it is porous and permeable and full of oil.

Sea Lion is far bigger than expected, so big they have no even found the oil/water contact yet and must drill an appraisal to find out how big it is.

Two other prospects are "basically the same" as Sea Lion, meaning they are likely now to be low risk drills.

This has massive implications not only for the UK and the Falklands economies, but for RKH too as a company, it surely will not be RKH for many years more as a major will be coming in to buy them up.

All thats needed to complete the story short term is the API of the oil.

27 would be very nice ! :)


PS - Lovely to see this as the lead story on C4 news and getting lots of press over the weekend.

From oil brat on iii


Ok folks as promised

First up, exploration requires luck as well engineering and all play to RKH they got it bang on the money. That said its not about the result of any individual well its about the basin and that is so fundamentally important to the future of both companies.

Those who have followed my rantings over the years will know that I favour DES over RKH (and actually I still do), however Im not afraid to hold my hand up and say Im wrong when I am. I was a significant buyer of RKH last week at around 85p. The fact I could buy them at that price was most surprising and I have made a pile of free money, result. See previous references to the competency of the city.

So lets look at the technical. Sea Lion has come in as expected, possibly a little more than expected. Its a sizable reservoir and is likely to indicate a +200m bbl recoverable find (note recoverable). The perm data was excellent 200 500md, its very good to first class. Unless the oil is treacle that should produce very well. What does that value RHK at? I would suggest on that single (not fully appraised) well that 250p in ground value per share is not unreasonable. It will take some time and another appraisal well and test but if that confirms the initial results then youd be looking at 450p to 500p based on Sea Lion alone.

Now that will raise the hackles of the derampers so lets look at that in more detail. At 500p a share you would value Sea Lion at circa 1.2 billion and the profit to be made on extraction and sale is of the order of 7 7.5 billion (less purchase cost and some capital expense, lift cost is factored in already and $16/bbl). Basically if Sea Lion is delineated you can at fairly low risk buy a 6 billion profit for an out lay of 1.2 billion. Its how large oil companies get to be very large oil companies. But that misses the entire point of both RKH and DES.

Both are entirely about the basin. Heres the story of the week, the North Falklands Basin is now proven. You will not find one single field in the basin, the geological odds on that was be monstrous, there will be multiple fields. All the nay sayers are or should be now finished, give up you lost. This information and RKH at 145 ish and Desire at 69 ish means the market has missed the point, as per usual.

Both are under valued as a function of assets, Desire have a condensate discovery as a bare minimum, and RKH are in the short term in an even better position. But the undervaluation as a function of potential and good will is enormous. I think in the fullness of time the shows in Liz and Beth will be of the same type and general play as Sea Lion the difference is the quality of the reservoir rocks. Desire went for multiple birds with one stone got a very very good result. RHK looked at that and said sorted, plan unchanged drill Sea Lion in the optimum place and the rest is in the RNS. I think Liz and Beth are going to end up being discoveries and commercial, its a function of sedimentology. The RKH well supports this possibility and proves the basin contains such units.

So what is the full potential. Some time ago I spent a few weeks doing my own research and looking at the possible field distribution. The US government did the same http://energy.cr.usgs.gov/WEcont/regions/reg6/p6/tps/AU/au606011.pdf
They indicate the probability of there being only one field of 250m 500m bbls (Well Sea Lion is that already, oil in place numbers not recoverable) and we havent even got started yet. They are indicating 40 possible discoveries I think that is considerably on the low side. It was also done pre the gas play and the new seismic / geological model.

My few weeks in the potting shed indicated Desire could have 8 billion recoverable, everything so far would push me to thinking that is more likely to be right than less likely (RKH have less but its still going to be very amusing to watch and good luck to them). I work off $8 in ground value for proven oil (pick your poison, thats mine). Obviously thats a staggering number and would put Desire at the top of the FTSE 100. That isnt going to happen for several reasons. A) It would require Desire to drill all the prospects and find all the oil B) It assumes they would have time before they where bought out.

There is now a map for oil generation, migration and trap and seal mechanisms in the NFB. This is going to significantly change the COS numbers, we will see an extended campaign and more finds, its now a certainty. (Yes they may have to raise more money but it will be forth coming). Desire, as per their business model will be bought out but at what price? The hypothetical 20 quid a share requires proven reserves of 1.2 billion barrels at $8/bbl. I think this is achievable, it may take 18 24 months but it is perfectly doable. I would then want a bit for good will so 2500p 3000p a share is probably full potential for Desire.

Now that little lot will probably induce a firestorm from the Deramping community, references to GKP etc. Sooo heres one to ponder. FOGL have also shot up this week. A tidy rise on the back of the North Falklands Basin, good for them, except they are not in the NFB. The result for RKH makes very little material difference to FOGL (it makes the world of difference to Desire), they might get slightly reduced / shared infrastructure but there is zero geological impact, their basin may as well be on Mars for its relationship to the NFB. Yet the market still marks them up, they just dont get it The more and more I read the oil press the more I realize that the market /city just doesnt have the expertise to match its reputation. I make a lot of money out of small oil and I do it on the Zulu principle of understanding more about it than the average man in the city.

There are still risks associate with the NFB, political, economic etc but geological have been very significantly reduced. In the next 10 years there wont be a better probable way to make money on the open market than buying into the basin at its earliest development stages. The price will go up and down as the market adjusts its underpants and Greece et al unravel everything but we still need oil and that is nice stable British oil. If you are in for 2 years plus you will see a many bagger unfold at low risk.

I await the howling but do you know what I dont care, Ive achieved what I wanted and this will release me from working with in the next two years I would estimate.

Regards
OB

There is a lot of talk about flow tests, however many are missing the point IMO.

Perhaps Friday's RNS was written to confuse your average PI with derampers calls of "no flow test for a long time" and allow institutions to buy based on proper understanding ?

For an oil reservoir to flow without any stimulation there must be permeability of 100 Milidarcy or more.

Reservoirs below 100 Milidarcy can be made to flow but require stimulation.

Now lets take the snippet from Fridays RNS


" Logs show excellent permeability. In the 25 metre pay zone, permeability ranges between 200 Milidarcy and 500 Milidarcy, with peaks at over 1 Darcy........"


Now that tells you that unless they have drilled into Treacle oil, its going to flow and flow well.

All we need to know now is whether its treacle or not.

27 API would be nice ! :) and thats what Shell recovered not too far away and much deeper.

So fingers crossed we get the API news of the fluid samples Monday or Tuesday, then all the pieces of the jigsaw are complete and away she blows.........


(20 API or higher is good, the higher the API figure the more valuable the oil is in general, up to about 45 API after which its not the case anymore).

Apparently EK closed his short position on friday at 85p and then went long as he believes the sp may go up several times from here.

bet his followers will be pleased if they have only just found out!

I think everybody is missing one point that this is at sea in incredible difficult conditions at times, this is not on land....the expenses for producing will be enormous and capital will be needed, loads of it....this is an excellent start, but who knows what else is down there ?.....Mauritania was supposed to be an eldorado....not quite as much as expected has been extracted.....my experience of sharp increases is a sharp pullback ...sort of three thirds up followed by one third back..that sort of thing...yes there are quite a few prospects out there but are they al going to come right ?...perhaps not...I feel the trend for this incredible "play" to take it fom Shares Magazine is for a very much volatile sp....JKD is probably right about trailing stop losses....in the short term anyway...

required field

re - ....the expenses for producing will be enormous and capital will be needed, loads of it

That is not a problem the big players wiil do it for RKH with time.

Excellent, its not treacle ! :)

While we have to wait for the lab tests to confirm the API we know its now a movable oil.

Porosity - Good
Permeability - Excellent
Pressure - Good
Oil - flowing well.

All the boxes ticked now :) !!


http://www.investegate.co.uk/Article.aspx?id=201005100700115903L


Rockhopper Exploration plc

("Rockhopper" or the "Company")

Drilling Programme Update

Sea Lion Exploration Well - 14/10-2

Oil Discovery - Completion of Logging

Rockhopper Exploration, the North Falkland Basin oil and gas exploration company, is pleased to provide the following update on results of the 14/10-2 well on the Sea Lion prospect.

Wireline fluid and pressure testing has been completed. Multiple pressure readings and multiple fluid samples have been successfully obtained.

The Ocean Guardian is not equipped with facilities to analyse the fluid samples, so analysis of the fluid samples will take place after the sample containers are shipped to a dedicated laboratory. However, the fluid sampling process suggested the following preliminary observations:

o All samples indicated to be oil;

o The sample chambers filled rapidly, indicating a good quality reservoir with no evidence of any free water as the sample chambers filled; and

o Filling characteristics suggest a mobile crude oil.

Pressure data was good with most attempted test points successfully located in good quality reservoir.

o Pressure readings indicate the possibility of two separate oil columns; and

o No oil water contacts or water sands have been recognised in the well.

Wireline sidewall cores have also been collected and the samples will be evaluated for reservoir characteristics in a laboratory.

The Company will make a further announcement once all the laboratory testing is complete and the above initial findings are verified.

The Company intends to run a liner and apply to suspend the well for future testing.

It is anticipated that operations will take a further week to ten days. A further announcement will be made once the rig is released.


Samuel Moody, Managing Director, commented:

"All current indications are that the oil recovered from the Sea Lion well is moveable which, if confirmed, would be further positive news. We will now wait for confirmation of the quality of the fluid as a result of the laboratory analysis, and continue our review of the data gathered from the well."

With reference to the 2 columns mentioned, let me highlight this post from III over the weekend. I think someone could be on to this already ............

The post on III from the weekend. Perhaps the second column is one monster one ??


i looked at the seismic of chatham and i noticed its under sea lion, i noticed that a while back, it also shows something very interesting indeed

if you look at the seismic of chatham, it shows a thick band of sea lion with chatham underneath to the west a little, however, directly below sea lion i see another band, maybe this is the second interval RKH is on about in the results, on the seismic it makes out this second band is part of chatham, but if this is a seperate prospect to add on to Sea lion, then BONUS!!!!!

for whomever wish to see this..... CPR page 35, or type 43/90 on the PDF

where is ernest relative to sealion?

on a note of more immediate gratification, it'll be interesting to see where sp goes today ..... my guess is that the initial reaction will be to push price up through the roof again, but the rise will be overdone, as is almost always the case.

fair value for this share/company at this juncture of the proceedings is very difficult to judge, as it will all be based on hypothesis, albeit that there is now something of substance slowly building

just looked at L2 .... queues to buy at 160 and upwards to 200

Happy Days

No....euggghhhhh.....aagghhhh.....sick.....very....

came to the conclusion that RKH was high enough, or at least too high to buy

with that in mind, i topped up DES which, though rising sharply, now looks good(ish) value to me given its x-company interests