Rockhopper soars on oil find
SHARES in British oil company Rockhopper Exploration reached a three-month intraday high after the Falklands-focused group reported that flow rates from a well off the north coast of the Falkland Islands were at commercially viable levels.
Rockhopper yesterday jumped as high as 11 per cent to 305.75p as the announcement signalled a positive step towards to proving that the oil discovery is commercially worthwhile. But the shares later slid to 262p as investors digested the news.
Brendan Long, an analyst at Merchant Securities said: “The flow test of well 14/10-5 is an important step on the way to formalising that Sea Lion is a viable project and that it will indeed be developed.”
The appraisal well flowed at stabilised rates of 5,508 barrels a day with a maximum rate of 9,036 barrels a day, the company said.
Rockhopper, set up in 2004 to explore for oil and gas in the Falkland Islands, made the first discovery last year followed by a “significant” oil and gas discovery at the Sea Lion field earlier this year.
It was the first explorer to discover oil in the Falkland Islands, putting pressure on a diplomatic dispute between Britain and Argentina over the islands’ sovereignty.