Desire Petroleum plc announced certain changes to its Production Licenses following approval received from the Executive Council of the Falkland Island Government.
Licenses PL003, PL004 and PL005
- Production Licenses PL003, PL004 and PL005 (the "License Group") will be grouped together with collective requirements for all three licenses. These licenses contain the Sea Lion extension and all other discoveries
- The existing work commitments under Phase 2 of the license period have been confirmed as satisfied
- The Phase 2 license period has been extended to May 1, 2016 with a one well work commitment during this period
- No relinquishment is required while this license group remains in Phase 2. Normal relinquishment provisions will apply should the License Group move into Phase 3
- Acreage rentals will remain at current levels of $60/ square kilometer for the duration of Phase 2.
Licenses PL006 and PL007
- Production Licenses PL006 and PL007, in the southern portion of Desire's acreage, will be relinquished in their entirety at the end of their respective Phase 2 periods - Nov. 25, 2012 and Oct. 29, 2012 respectively. A mature source rock is unproven in this area, and the only significant prospectivity in the license areas was tested by the 25/5-1 well which encountered only gas shows.
Commenting on the update, Stephen Phipps, Chairman of Desire, said:
"We are extremely pleased with the changes to our licenses, and thank the Falkland Island Government for their understanding in agreeing our revised license terms. Desire now has over three years in which to further explore its highly prospective key license areas in the northern part of this basin."