Lundin Oil AB Announces Agreement with Desire Petroleum Plc for Exploration in Falkland Islands

Strategic Insights -

Lundin Oil AB, a 50% owner of Sodra Petroleum AB, has reached an agreement with Desire Petroleum Plc to earn a 12.5% working interest in Tranche F, offshore the Falkland Islands. This agreement marks a significant development in the exploration of the North Falkland basin, where Sodra will mobilize the Borgny Dolphin rig to Block 14/24 in Tranche F. The exploration well, 14/24-A, is expected to be spudded in the next few days and will target the Braela prospect at a depth of 3,750 meters.

The agreement is a result of a data sharing agreement between Sodra, Amerada Hess, Lasmo, and Shell, which has provided valuable insights into the hydrocarbon system in the North Falkland basin. The results of the first three wells (14/09-1, 14/13-1, and 14/05-1) have shown that an active hydrocarbon system exists in the basin, comprising at least three separate hydrocarbon-generating sources.

Key Takeaways:

  • Lundin Oil AB has reached an agreement with Desire Petroleum Plc to earn a 12.5% working interest in Tranche F, offshore the Falkland Islands.
  • Sodra will mobilize the Borgny Dolphin rig to Block 14/24 in Tranche F to drill the exploration well, 14/24-A.
  • The exploration well, 14/24-A, will target the Braela prospect at a depth of 3,750 meters.
  • The well is expected to take approximately one month to drill.
  • Sodra has the benefit of the results of the first three wells (14/09-1, 14/13-1, and 14/05-1) through a data sharing agreement with the other operating companies (Amerada Hess, Lasmo, and Shell).
  • The presence of oil and gas shows in two of the wells is encouraging for exploration elsewhere in the basin.
  • Sodra believes that Tranche F is better located to find reservoir rocks than the more northerly tranches, due to its proximity to the sediment source.

Statistics:

  • 50%: Lundin Oil AB's ownership in Sodra Petroleum AB
  • 12.5%: Desired Percentage working interest in Tranche F, earned by Desire Petroleum Plc
  • 3,750 meters: Target depth of the exploration well, 14/24-A
  • 4,525 meters: Total depth of the Shell well, 14/05-1A
  • 1 month: Estimated drilling time for the exploration well, 14/24-A
  • 3: Number of separate hydrocarbon-generating sources in the North Falkland basin
  • 2: Number of wells that intersected oil and gas shows
  • 2: Number of hydrocarbon-generating sources that were penetrated in the Shell well, 14/05-1A

Sources:

  • Lundin Oil AB Press Release, September 9, 1998 (BUSINESS WIRE)
  • Desire Petroleum Plc, Agreement with Lundin Oil AB (TSE:LOI.)
  • Sodra Petroleum AB, Exploration Update