Rockhopper Says Falklands Seismic Data Encouraging
Rockhopper Exploration says that volumetric work has been completed on the Company's leads and prospects in licenses PL023 and PL024. The work suggests unrisked P50 recoverable reserves of in aggregate 2.5 billion barrels providing encouragement against the backdrop of an easing rig market.
Rockhopper is also pleased to report that it is further encouraged following an initial review of 3D seismic data covering licenses PL032 and PL033, from where oil was recovered in 1998. The survey is the most modern 3D project undertaken in the Falkland Islands to date. Significantly, both structural closures and fan type bodies can already be seen.
2D data - PL023 & PL024 - target sizes
Rockhopper has now completed volumetric work using the 2D seismic data collected in 2006 on a number of targets in licenses PL023 and PL024 which suggests unrisked P50 recoverable reserves of in aggregate 2.5 billion barrels.
All of these targets are in relatively shallow water depths of less than 200m. The potential range of target sizes is listed below. The minimum economic size is likely to be 35 to 50 million barrels recoverable. The Company believes that the net present value of a single 100 million barrel recoverable oil field would be between US$750 million and US$1 billion.
Recoverable oil Millions of barrels (unrisked) Name P10 P50 P90 Beauchene 216 145 98 Bleaker 387 193 119 Concordia 60 44 20 Dolphin 543 287 49 Ernest 300 130 50 Golding 125 49 4 Keppel 812 580 365 Pebble 298 186 97 Saunders 679 434 171 Usborne 290 220 150 Weddell 394 254 108
These represent the best 11 structural targets in the opinion of the Directors. There are a number of smaller additional leads which have not been listed. The names are taken from Falkland place names. No reserves have been attributed to any stratigraphic leads which are likely to mature with further data acquisition.
Ernest, which is a 4 way closure with a positive CSEM anomaly, located in the North of PL024, remains the most attractive prospect.
3D Data - PL032 & PL033
Rockhopper expects to receive the final processed 3D volume at the end of July. This 3D covers an area of over 800 square kilometers and extends along some 30km of the untested eastern basin margin. Data acquisition took place between November 2006 and January 2007 and the survey is the largest of the three 3D surveys carried out in the North Falkland Basin.
The Company has already received the initial Quality Control ("QC") volume. These data are of high quality and represent the most modern 3D undertaken in the Falkland Islands to date. The QC data volume is the entire data volume, delivered prior to the completion of processing. It allows the Company to make an initial interpretation of the data and also to finalize the processing work required.
The initial interpretation of the QC volume reveals a number of structural closures and two large fan bodies that can clearly be seen even at this early stage.
Once interpretation of the final processed 3D data is completed, prospects will be ranked and drilling locations will be decided.
Pierre Jungels commented:
"The data we have available to us is extremely encouraging and further reduces our exploration risk in the North Falkland basin. The target sizes in licenses PL023 and PL024 provide confidence in the potential upside should any discovery be made in the area and with the rig market easing, our work will now focus on selecting the best targets for drilling. Oil has already been recovered on licenses PL032 and PL033 so the fact that we can see structural closures and possible fans on our 3D seismic in this area is highly significant and increases our confidence in the prospectivity of the acreage.
While most of the targets listed above are entirely within Rockhopper acreage, others straddle the boundary between Rockhopper acreage and unlicensed acreage, or acreage licensed to other operators. For example, while approximately 95% of target Ernest (P10) is within Rockhopper acreage, the analysis above relates to 100% of the target.
No risking has been performed in calculating the numbers above. Where targets are basement structures, a 30m net pay has been assumed. Where targets are shallower closures, a net to gross of 0.65 has been applied to the volume. Conservative reservoir parameters have been applied throughout.
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