Falkland Oil and Gas FOGL Operations Update

  Falkland Oil and Gas (FOGL) - Operations Update

RNS Number : 5183P
Falkland Oil and Gas Limited
25 October 2012




25 October 2012



                         Falkland Oil and Gas Limited

                                      

                          ("FOGL" or "the Company")

                                      

                              Operations Update



FOGL, the oil  and gas exploration  company focused on  its extensive  licence 
areas to the South and  East of the Falkland  Islands, is pleased to  announce 
the completion of the farm-out  agreement with Noble Energy Falklands  Limited 
("Noble"), an affiliate of  Noble Energy, Inc. and  the signing of  agreements 
with Petroleum Geo-Services (PGS)  for the acquisition  and processing of  two 
new 3D seismic surveys. The Company is also providing an update on the  Scotia 
well.



Noble farmout completed



Further to FOGL's announcement on 6 August 2012, the farmout to Noble has  now 
been formally  approved  by the  Falkland  Islands Government.  Therefore  the 
agreement has now been completed  and this represents a significant  milestone 
for FOGL.



Two 3D seismic surveys commissioned



Two separate agreements have been entered into with PGS to acquire and process
3D seismic data over  the joint venture's licences.  The first survey will  be 
located within the  northern area licences  and will cover  a minimum area  of 
4,000 square kilometres. PGS will use  the survey vessel M/V Ramform  Sterling 
and the survey is expected to commence in late November 2012. This survey will
be operated by Noble.



The second survey will utilise the survey vessel M/V Ramform Challenger within
the southern area licences and will cover1,000 square kilometres. This survey
is expected to commence in the first  quarter of 2013 and will be operated  by 
FOGL.



These surveys will require the consent of the Falkland Islands Government  and 
the granting of  an exploration  licence to PGS  to undertake  this work.  The 
precise locations  of both  3D surveys  are currently  being finalised  and  a 
further update will be provided once the acquisition programme has commenced.



As a result  of committing to  these 3D seismic  surveys the Falkland  Islands 
Government has agreed  in principle  to extend Phase  2 of  the northern  area 
licences by two years to  15 December 2018 and  the southern area licences  by 
one year to 3 December 2016.



Scotia well update



Drilling of the  Scotia well  had been  proceeding to  plan and  was ahead  of 
schedule by approximately three days. A routine test on the blow-out preventer
(BOP) revealed  an equipment  malfunction. The  BOP has  now been  brought  to 
surface in order  to replace the  failed component. In  the light of  problems 
encountered by a  previous operator,  FOGL had commissioned  an extensive  and 
independent examination of the BOP prior to the commencement of drilling. The
recent malfunction is related  to a part that  had been used without  problems 
during the  drilling of  the  Loligo well  and  had been  successfully  tested 
earlier on the Scotia well.



The rig will be on  a zero day rate whilst  the repairs are being  undertaken, 
although other  costs will  continue to  be incurred  and we  will provide  an 
update of costs after the well has  been completed. We expect the repair  work 
to take approximately 2 weeks to complete and as a result, there is likely  to 
be a commensurate delay in reaching the total depth of the Scotia well. 

                                      

                                   - Ends -

                                      

Enquiries:



Falkland Oil and Gas

+44 (0) 207 563 1260

Tim Bushell, Chief Executive



Oriel (Nominated Advisor and Joint Broker)

+44 (0) 207 710 7600

David Arch / Gareth Price / Ashton Clanfield



Jefferies Hoare Govett (Joint Broker)

+44 (0) 207 029 8000

Alex Grant / Chris Zeal / Graham Hertrich



FTI Consulting

+44 (0) 207 831 3113

Ben Brewerton / Ed Westropp





The technical information  included in  this announcement  has been  reviewed, 
verified and compiled by the Company's geological staff, including a qualified
person, Colin More BSc., MSc. (Exploration Director), who has over 26 years of
experience in petroleum exploration, for the purpose of the Guidance Note  for 
Mining, Oil and Gas Companies issued  by the London Stock Exchange in  respect 
of AIM companies, which outline standards of disclosure for mineral  projects. 
Mr More  is  a  member of  the  Geological  Society of  London,  the  American 
Association  of   Petroleum  Geologists   and  the   Society  of   Exploration 
Geophysicists.

                     This information is provided by RNS
           The company news service from the London Stock Exchange

END


DRLFMMZGRKDGZZG -0- Oct/25/2012 09:00 GMT
 
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