Falkland Islands petroleum legislation is separate from that of the UK, although there are marked similarities to UK North Sea legislation. The licenses have been awarded to a Joint Venture comprised of Global Petroleum Ltd 50% (Operator); Hardman Resources Ltd 30% and Falkland Islands Company with the remaining 20%. Global Petroleum is a newly-formed Australian petroleum company listed on the Australian Stock Exchange. The Falkland Islands Company is the main infrastructure and commercial entity in the islands.
The South Falklands Basin, where Hardman's licenses are located, is distinct geographically and geologically from the northern basin which was the focus of exploration activity in 1996-98. The southern basin is under-explored and is covered by a grid of seismic data dating back to 1993 and totaling almost 8,000 kms. This basin has analogies with the Malvinas and Magallanes Basins in Argentine waters to the west of the Falklands, where a well drilled by Exxon in the early 1980s flowed 3,200 barrels of oil per day, demonstrating the existence of a nearby working petroleum system.
The permit has been awarded for an initial three-year period during which the Joint Venture will reprocess existing seismic data, followed by acquisition of a new seismic survey to further delineate leads identified. At the end of this period, all or part of the permit area may by renewed for a further three-year period during which drilling of one or more wells will be required.
Hardmanís Managing Director, Ted Ellyard, commented: "We are very pleased to have been awarded such a large acreage position in this frontier basin. The South Falklands Basin is quite different geologically from the North Falklands Graben, with a much thicker sedimentary section, Cretaceous source rocks and potentially large structures. This acreage award fits within Hardman's strategy of acquiring large acreage holdings of prospective frontier basins at the early stage of exploration. Five years ago the Mauritania deep-water basin was at a similar stage of exploration. We now hope to repeat our success in Mauritania in one or more of our other frontier projects, and hopefully in the southern Falklands, where a technically focused and staged exploration program will be undertaken".
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