ERCE: Sea Lion Complex Could Hold 1.7B Barrels of Oil

The Sea Lion Complex in License PL032 in the Northern Falkland Basin has been independently estimated by ERC Equipoise (ERCE) Limited to hold 1.7 billion barrels of oil in place with 2C Contingent resources of 517 million barrels of oil and 747 million barrels of oil equivalent of natural gas.

As part of its audit, ERCE also estimated that 277 million barrels of oil in place was present within the Isobel Elaine area, located within PL004, with 2C contingent resources of 20 million barrels at Isobel Deep. The report also revealed that 282 million barrels of oil in place was yet to be discovered at Isobel Elaine.

Rockhopper Exploration plc, which holds a 40 percent interest in license PL032 and a 64 percent stake in license PL004, intends to develop resources found in the reservoirs that make up the Sea Lion Complex, including the reservoirs discovered in the Zebedee well, in two phases. The first phase will develop the resources in the north-east and north-west of the SL10 and SL20 fans.

"In our view this new audit confirms the potential of the North Falklands to be a billion barrel basin. The Sea Lion Complex itself holds over half a billion barrels with almost 270 million barrels of low risk near field upside (including the SL20 west flank in oil-bearing case) which we believe could be assessed with as few as three or four more optimally targeted wells,” said Rockhopper Chief Executive Sam Moody.

“In addition, the Isobel Elaine discovery has the potential to be a third regional development potentially containing over 500 million barrels. Combining the well-appraised Sea Lion field, the low risk near field upside and the Isobel Elaine appraisal area, a billion barrels of recoverable oil is within reach within the basin thanks to the outstanding track record of our sub surface team," he continued.

Following ERCE’s independent audit of resources in the North Falkland Basin, FirstEnergy has reported that the market reaction to the news is “neutral”.

“Given the uncertainty around the development of the Falklands assets, we do not anticipate the shares to react much to this announcement,” said FirstEnergy in a brief research note.


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