The explorers still active off the coast of the Falkland Islands are in demand as they announce the Isobel Deep well has yielded a discovery. The well, drilled in a venture between Rockhopper (RKH:AIM), Premier Oil (PMO) and Falkland Oil & Gas (FOGL:AIM), has encountered 27 metres of net oil pay in the North Falklands basin.
The news is only giving Premier a modest boost – up 1.7% to 30.5p but the more pure Falklands plays Rockhopper and Falkland are up 15.5% to 28p and 12.9% to 8.24p respectively.
Rockhopper, in the final stages of a merger with FOGL, says the re-drill of the Isobel Deep well on the edge of the Elaine field, is ‘highly likely to contain a commercially viable quantity of recoverable oil’. Once the tie-up is complete Rockhopper will have a 64% stake in the find with Premier holding the remaining interest.
It is interesting to draw a comparison with the reaction when Rockhopper made the first discovery off the Falklands in May 2010. The Sea Lion find sparked an intra-day move of 150% in Rockhopper and 15% in Falkland Oil & Gas. Just under six years later investors are much more jaded given weak oil prices which raise some question marks over whether resources in such a remote location will be developed.