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/

FOGL, the oil and gas exploration company focused on its extensive licence areas to the South and East of the Falkland Islands, announces certain changes to its licence arrangements with the Falkland Islands Government.

Northern licence area

"Due to the tight rig market it is increasingly unlikely that the next phase of the drilling programme will commence in 2010 as required by the current terms of the licences. Following recent discussions, the Falkland Islands Government ("FIG") has agreed to extend the first phase of the northern 2004 licences by one year, so that they will now expire on 15 December 2011. No additional work obligations or acreage relinquishment will be required in respect of this licence extension and the existing Phase 1 work commitments remain unchanged.

Southern licence area

Separately, BHP Billiton has advised FIG and FOGL that it has elected not to enter the second phase of the southern 2002 licences which commences on 3 December 2010.

FOGL believes, based on the drilling results from the Toroa well analysed to date, that these licences are still prospective. Furthermore, we are still awaiting the analysis of some key well data and these results are now expected to be available in October. FOGL has identified a number of prospects and leads which may prove to be of interest, particularly in the event of drilling success in the deepwater area of the northern licences, or in the south, where the licences are contiguous with acreage held by Borders and Southern Petroleum.

Having fulfilled all the work obligations of Phase 1, FOGL has therefore decided to enter the second phase of these licences. This will entail the drilling of a single exploration well by 3 December 2015. BHP Billiton will assign its 51% licence interest to FOGL which takes FOGL's interest back to 100%. FOGL expects to take over the operatorship of these licences during the next few months."

Sp marked down 22% at the open.

Cynic's short was spot on !......the one not to be in.....needs a new partner...

Well done, cynic, 90p likely with no rig in sight.

There is no way he could have known that info in advance. Excellent result, but must have been partly speculative?

i told you why i shorted at the time, and several times since ..... licences are in entirely the wrong area and i could see no reason at all why sp should rise in sympathy with RKH, which is the only company (so far) to have found oil

Risky because they could have announced that a rig has been found ...in which case the sp would have rocketed...

Thats what happens when you hit a coal field and not oil............well done cynic

RF - sometimes you really are a total ass, or is this a touch of singed sour grapes .... dealing in the stock market is risky .... in any case, even finding a rig (never remotely likely) would not have altered the location of the licences

There might be oil there...who can say ?....I'm just saying that they could or might have found a rig...when DES found one...everybody was saying that they wouldn't...
Not in....and made good profits a few months ago pre-Torea....

you're a tosser! .... there might be oil in my back garden too, but I can't find a rig or get the licence from the local council

thats harsh this time in the morning cynic, he's learning like me ....the hard way.....best way. Same as me i topped up a few rkh last thursday and wish i hadn't and waited.......you never told me to wait.......silly ass.

Steady with tthe drinkin' in the morning Cyners......anyway....FOGL is the one not to be in....

that wasn't my point ... it was RF's attitude problem ..... btw, i also bought more RKH last week and took the hit this morning

Frankly, the south atlantic is so remote that they could probably drill there and nobody would know about it...perhaps the argies have one up and running and we don't know it !.

it's of pretty debatable value, but the chart is now vile with sp dropping straight through 25+50+200 dams without touching the sides ..... i guess there could be a bounce as short positions are closed, but equally and actually perhaps more likely, sp could easily drop down through 100.

(moderately) dispassionately, i really cannot see what there is to support this stock at all ..... they have no rig and even their big-bro partner has abandoned ship - scarcely a vote of confidence

OH dear, tech hitch......sp going wrong way......

She is roaring ahead as is trying to go over 130p, not yet there

Has now has gone over the 20 days MA, 2 weeks ago 20 days did crossed over 50 days positive as the bounce from support on Tuesday.