Company Update

24 Jan 2007 07:01

Desire Petroleum PLC24 January 2007 For immediate release 24 January 2007 Desire Petroleum plc ("Desire" or "the Company") Company Update Desire Petroleum plc (AIM: DES), the oil and gas exploration company whollyfocused on the North Falkland basin, today announces an update on itsactivities. The Company has taken delivery, in Aberdeen, of long lead time items, includingthe casing, tubulars and wellheads required for the planned 3 well drillingprogramme in the Falkland Islands. This equipment, valued at around £2.75million, represents a significant part of the down-hole materials required forthe drilling operation. The equipment will be stored near Aberdeen untilrequired for the drilling campaign. It should be noted that since the order wasplaced in early 2006 the cost of this equipment has risen significantly. The Company continues to pursue a number of avenues in seeking to obtain a rigfor drilling in the North Falkland Basin. In addition to continuing discussionswith rig owners and potential farm-in partners, Desire is investigating theoption of joining with the other operators in the Falklands to conduct a jointdrilling campaign along the lines of the 1998 drilling campaign. The Directorsbelieve that a multi-well joint campaign is likely to be of much greaterinterest to rig owners than a Desire stand-alone 3 well programme. In December 2006 Dr Colin Phipps the Chairman of Desire underwent a successfuloperation and is currently convalescing prior to commencing a further course oftreatment. Dr Phipps continues to keep up-to-date with the Company's progressbut, pending his full recovery, his duties as Chairman will be undertaken byStephen Phipps who has been appointed Acting Chairman by the Board. For further information please contact: Desire Petroleum plc 020 7436 0423Stephen Phipps, Acting ChairmanDr Ian Duncan, Chief Executive Officer Buchanan Communications 020 7466 5000Ben WilleyTim ThompsonBen Romney Notes to the Editors: Desire Petroleum plc (AIM:DES) is an oil and gas exploration company whollyfocused on the prospective North Falkland Basin. The Company holds large equitypositions in 5 tranches in the area. In 2004, Desire raised £4 million to finance a 3D seismic campaign over itsacreage, followed by a further £25 million in 2005, to finance a multi welldrilling campaign. The Company is presently seeking a rig for this programme. The North Falkland Basin is believed to hold in excess of 2 billion barrels ofoil in place and has an established working hydrocarbon system. Seismic workcompleted in the basin has identified many delta and fan trapping plays, wherehydrocarbons may be located. Desire was formed in 1997 to participate in the drilling campaign in theFalkland Islands with several other companies in 1998. During the campaign, 6wells were drilled, of which 5 wells encountered oil shows - and one wellrecovered live oil to the surface. This information is provided by RNS The company news service from the London Stock Exchange