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Gold/Mining/Energy : Lundin Oil (LOILY, LOILB Sweden) -- Ignore unavailable to you. Want to Upgrade?

To: Tomas who wrote (1266)	9/3/1999 7:00:00 AM
From: Tomas	Respond to of 2742

Oil Operators Planned Pull Out Of The Falklands - But Shell hasn't given up hope A report For Calling The Falklands By David Wood (DW) 27/08/99 Falkland Islands News Network, September 2 Planned Pull Out Of Oil Companies Is Expected There have been many rumours and counter-rumours in the past couple of weeks about oil exploration companies leaving Falklands waters. Earlier this week a press agency claimed that Shell, Lasmo, and Amerada Hess are all abandoning any plans to return to the Falklands. However, a spokesman for Shell has told this programme that the Company is not abandoning the area and that it hasn't given up hope of an oil find. Amerada Hess said in May that it would be halting its exploration and earlier today, Tim Bushell (TB) of Lasmo confirmed that the company had applied to pull out of its "C" and "D" Tranches. TB It really depends on the Government to decide whether they can sanction the withdrawal and in the event that we do then the Company, Desire would probably take over our equity position in those licenses and, indeed, take over the operatorship of those two blocks at the same time. DW And by withdrawing, is that withdrawing for good? TB Our current feeling is that we, as you know, participated in a seven well drilling campaign last year. I think the results were, best say, mixed. We had some encouragement but overall, we didn't find the large oil accumulation that we went down there to look for in the first place. So, although, I suspect it is unlikely that we would return to the Islands, you never know. If someone else is lucky enough to find oil in quantities greater than we think are there then we may come back again. DW Now, obviously you will be disappointed by this but are you particularly surprised? TB I'm not particularly surprised. I think we always stressed that the risk of finding commercial quantities of oil were something like one in ten so this was the most likely result. I am personally disappointed because we very much enjoyed working in the Islands. We got a lot of support from both the Government and from the people there. It was a very good operation and so disappointment all around that it didn't work out but I guess, in a business way, we have to get used to that kind of failure. DW You've nothing else then. Has it been an interesting exercise for you? TB It has been very interesting. It was a good example of Oil Companies getting together to collaborate on a project. That doesn't rather surprisingly happen not to so much of a degree that it did in the Falklands. We are already talking about using that model elsewhere in the world where we are exploring so there were a lot of good lessons coming out of it. I think as well the work we did on the environmental impact of our operations down there, working with the local authorities, the interest groups and the environmental people in the Falklands was very good as well. In fact, we are very proud of the activities there. DW Even though you are pulling out, what's in it for Desire to stay there? TB We know that there is oil around in the sub-surface down there. Our own view is that it is not enough to be economic for a Company of Lasmo's size but a much smaller company like Desire could certainly, if they, have a bit of success to turn that into a small economic prospect and its something that for them is worth staying. Also, Lasmo has other projects around the world and the Falklands have to be ranked with what we have been doing elsewhere. It's just unfortunate they fell off the bottom. Other companies might find it more interesting and are excited to go and explore there, so Desire just may be just one of a number of companies that you see exploring as part of what might be a second wave of interest down there in the next few years. DW So, If You are one of the Falkland Islands' Desire Shareholders, you wouldn't give up hope? TB No. I wouldn't actually. I think Dr. Phipps is keen to continue down there and he needs some encouragement from the world. It wasn't a total write-off by any means. There is enough encouragement to give people the will to carry on I think. It's worth staying in there, really. sartma.com

To: Tomas who wrote (1266)	9/3/1999 7:05:00 AM
From: Tomas	Read Replies (1) \| Respond to of 2742

Desire Could Return To The Falklands. Desire Will Be Back....in 12 to 18 Months A Report For Calling The Falklands By D. Palmer (DP) 31/08/99 Falkland Islands News Network, September 2 As expected, Desire Petroleum is merging with the Irish gas and oil exploration company, Gaelic Resources which recently announced a gas find off Portugal. But that doesn't mean that the merged company will abandon its search for Falklands oil. According to Desire's Chairman, Dr. Colin Phipps (CP), he expects to return to the Islands but not immediately. CP I don't expect drilling to recommence in the Falklands, even while the oil price has come back for perhaps another 12 to 18 months. First of all, I think that the industry as a whole has got to feel more confident that these higher oil prices will last. Secondly. I don't think we can afford to bring another drilling rig all the way down from the UK as we did before. That really means that drilling in the South Atlantic, particularly offshore Brazil, has got to get going so that there are some rigs around that we can use. I don't see that happening for the next 12 to 18 months. But, I can't see us drilling in that period. Now, the reverse really is true for Gaelic. Gaelic have a gas discovery in Portugal which looks very interesting indeed. And, that is about to be appraised, hopefully before the end of this year, when the next well will be drilled. Gaelic's problem is that they are short of cash and, of course, Desire has sufficient cash and no discovery as well so, from both points of view, it looks a sensible match. DP But, it doesn't mean that the enlarged company can concentrate on the gas interests at Gaelic at the expense future exploration in the Falklands, then? CP No. Far from it. I mean, what we are hoping is that if the gas interests prove to be very successful and that will indeed lend impetus to the company's search in the Falklands by enabling us, for instance, to raise extra cash and move forward on our own without necessarily even having to farm out. Although, we now have such large interests in the Falklands that I suspect we would seek to farm out anyway in this period. DP And this is a good deal for Desire shareholders, isn't it? CP Well, it certainly gives Desire Shareholders some immediate interest and the possibility of some immediate up-rise. I think that was important for Desire because although the Falklands remain for us a very, very exciting prospect, a wait of 12 to 18 months with relatively little happening is a sure-fire dampened, I'm afraid, as far as interest in the City is concerned. DP And, it really is a merger? It's not a take-over of Desire by another name? CP No. It is a merger. As it happens, the Company will keep the new name, Desire and the new board will largely comprise Desire Directors and, of course, a lot of the Gaelic Shareholders are themselves, Desire Shareholders. The two companies, in terms of shareholders have been related. I am on the board of both companies, for instance. Phipps and Company have a substantial shareholding in Gaelic as well as in Desire. DP So, does that mean the Shareholders in Desire will be better off at the end of the day? CP There will be no difference at all in terms of the value of their shareholding. That won't change. But hopefully, I am told, the prospects in Portugal will do well and that should reflect in the share price of Desire. sartma.com