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Falkland oil well boosts Rockhopper shares | Falkland oil well boosts Rockhopper shares |
(about 6 hours later) | |
Shares in Rockhopper Exploration jumped 38% after the British oil company said its oil well in the Falkland Islands is likely to prove commercially viable. | Shares in Rockhopper Exploration jumped 38% after the British oil company said its oil well in the Falkland Islands is likely to prove commercially viable. |
In a trading update the firm said an appraisal of its Sea Lion well had found a high quality reservoir package. | In a trading update the firm said an appraisal of its Sea Lion well had found a high quality reservoir package. |
"Following this positive result we believe Sea Lion is highly likely to prove commercially viable," said chief executive Samuel Moody. | "Following this positive result we believe Sea Lion is highly likely to prove commercially viable," said chief executive Samuel Moody. |
It raises hopes that the territory could become a new oil province. | It raises hopes that the territory could become a new oil province. |
The announcement came as oil prices climbed $2 a barrel following a series of air strikes against Libya, the world's twelfth-largest oil producer. | The announcement came as oil prices climbed $2 a barrel following a series of air strikes against Libya, the world's twelfth-largest oil producer. |
Brent crude rose as much as $2.26 to $116.19 a barrel, while US light, sweet crude rose as much as $2.13 to $103.20. | Brent crude rose as much as $2.26 to $116.19 a barrel, while US light, sweet crude rose as much as $2.13 to $103.20. |
Exploration | Exploration |
Rockhopper began drilling for oil off the coast of the British-governed islands last year and struck oil in May. | Rockhopper began drilling for oil off the coast of the British-governed islands last year and struck oil in May. |
It was the first discovery of oil in Falkland Islands waters. | It was the first discovery of oil in Falkland Islands waters. |
Following further tests the company has said it had discovered a substantial oil column and oil-water contact for the first time. | Following further tests the company has said it had discovered a substantial oil column and oil-water contact for the first time. |
The quality of the oil is of medium grade, according to the company. | The quality of the oil is of medium grade, according to the company. |
"We can now continue to appraise the Sea Lion discovery and to explore additional prospectivity within our acreage with added confidence," Mr Moody said. | "We can now continue to appraise the Sea Lion discovery and to explore additional prospectivity within our acreage with added confidence," Mr Moody said. |
Another explorer in the North Falkland Basin, UK-based Desire Petroleum, saw its shares in the opening minutes of trading leap 33% on the news. | Another explorer in the North Falkland Basin, UK-based Desire Petroleum, saw its shares in the opening minutes of trading leap 33% on the news. |
The current exploration of the waters around the Falklands has proved controversial. | The current exploration of the waters around the Falklands has proved controversial. |
Argentina still claims sovereignty over the islands, which lie 300 miles from its shore. | Argentina still claims sovereignty over the islands, which lie 300 miles from its shore. |
When the exploration plans were first announced, the former UK Defence Minister Bill Rammell said the government had a "legitimate right" to build an oil industry in its waters. | When the exploration plans were first announced, the former UK Defence Minister Bill Rammell said the government had a "legitimate right" to build an oil industry in its waters. |
Rockhopper closed up 32.6%, or 70.75 points to end Monday's trading at 287.75p a share. |
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