Possible $788m boost from Falklands oil field for South West exploration firm

South West oil exploration firm Rockhopper today said it could reap an additional $788m (£578m) from its interests in the South Atlantic following the results of an updated independent technical report into reserves in the area.

The Salisbury-headquartered firm holds a 35% stake in the Sea Lion field 220km north of the Falkland Islands, which earlier tests suggest could generate a total income of $4.5bn (£3.3bn).

But in an update to the London Stock Exchange today, Rockhopper said the new report showed overall gross resource volumes and net present values had increased when compared with the earlier analysis carried out last December.

Rockhopper has described phase 1 of the Sea Lion Project as the single most important milestone it had achieved since completing its original appraisal campaign in 2012.

Work in the oil field is now moving into a full development phase.

Today’s report shows an increase in resources combined with the acceleration of development at a central development area of the oil field.

Using updated commodity price assumptions, this has led to “a significant increase of approximately $788m” in the value of Rockhopper’s 35% interest in the Sea Lion development, it said.

This comes despite a fall in global oil prices.

Rockhopper has been operating off the Falklands since 2004 and discovered and appraised Sea Lion in 2010.

Since then, it has conducted numerous surveys and tests and raised funding for the project.

It is working alongside Israeli exploration firm Navitas Petroleum, which bought the 65% stake in the scheme in 2022 from UK oil giant Harbour Energy.

The project is being executed in three phases, with the first two expected to reach peak daily production of around 55,000 barrels.

The project has debt finance in place of $1bn of senior debt, of which $350m is Rockhopper’s debt.

Rockhopper also holds a 100% interest, and is the operator of, a number of fields to the south and east of the Falklands which it considers to potential gas resources.