Falklands License Farm-ins Completed

Rockhopper Exploration reported Monday that farm-out negotiations involving two licenses offshore the Falkland Islands have been completed between it, Premier Oil and Falkland Oil & Gas Limited (FOGL). The news comes days after FOGL completed its merger with fellow Falkland Islands explorer Desire Petroleum. 

The farm-out was in respect of the PL004a and PL004c licenses in which Desire held working interests of 92.5 percent and 75 percent respectively. The completion of the negotiations means that Premier and Rockhopper have now both farmed into the licenses, with Premier holding a 36-percent stake in both licenses and Rockhopper holding a 24-percent stake.

The enlarged FOGL will hold the remaining 40-percent interests in the licenses.

As part of the deal, Premier and Rockhopper have agreed to fund FOGL's share of the cost of two exploration wells – one on each of the licenses. Rockhopper said that it expects these wells will be included in the next drilling campaign, which could start as soon as late 2014 and will target the Isobel/Elaine and Jayne prospects.

In a separate company statement Monday, FOGL Chief Executive Tim Bushell said:

"The signing of this agreement with Premier and Rockhopper is an important first milestone for the new enlarged company. The farm-out allows us to participate in a more extensive exploration drilling program, whilst retaining meaningful equity stakes in high potential assets and signifies the launch of a very exciting period ahead for FOGL."

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