Darwin Fluid Analysis

RNS Number : 6716K

Borders & Southern Petroleum plc

23 August 2012

 



23 August 2012

Borders & Southern Petroleum plc

("Borders & Southern" or "the Company")

Darwin Fluid Analysis

Borders & Southern (AIM: BOR) is pleased to announce the results of the Darwin fluid sample analysis. As previously reported, well 61/17-1 encountered a good quality sandstone reservoir comprising 67.8m of net pay with an average porosity of 22%. The gas condensate reservoir was sampled at four separate levels with 3 fluid samples taken at each level.

The initial condensate yield from the Darwin gas samples, as measured in a laboratory separator test, varies from 123 to 140 stb/MMscf. The API gravity of the condensate is 46 to 49 degrees. Based on the condensate yield and ongoing reservoir modelling, the Company estimates the recoverable volume of condensate to be 130 to 250 million barrels with a mid case of 190 million barrels.

Following these positive laboratory results, the Board will approve a work programme that includes appraisal drilling of the Darwin discovery. Additional wells are necessary to confirm the initial resource estimates and establish a commercial development. In the coming months, activity will focus on a comprehensive technical evaluation of all the data collected from well 61/17-1 and a review of potential development concepts along with project economics.

These results have exciting implications for the Company's prospect and lead inventory and particularly for those prospects in the Lower Cretaceous play fairway to the south of the Falkland Islands. Borders & Southern's prospect inventory contains further relatively low risk structural prospects of a similar size to Darwin along with stratigraphically trapped fans of slightly higher risk but larger scale. Some of these prospects will be targeted in the next drilling phase with the objective of adding to the discovered resources of Darwin and building a core development area.

Discussions with a seismic contractor regarding the acquisition of additional 3D seismic are in progress and we plan to have a vessel in the Falklands at the start of 2013 to commence the survey. This survey will focus on similar prospects to Darwin currently outside our existing 3D area. Whilst the final costs of the 2012 drilling programme will not be fully known until after the demobilisation of the rig later in the year, the Company can state that it is fully funded for the 3D seismic acquisition and processing, the reprocessing of the Company's 2007 3D seismic data and all the technical studies that need to be undertaken on the samples collected from the two wells.

Given the encouraging results from the Darwin well, the Company will start planning the next drilling programme, which is likely to include both exploration and appraisal wells. The timing of drilling will be dependent on rig availability, but realistically this will not occur before 2014. The Company is currently exploring the best way to fund the next phase of the programme, including the possibility of now bringing in partners.

For further information please visit www.bordersandsouthern.com or contact:

Howard Obee, Chief Executive Borders & Southern Petroleum plc Tel: [phone]

Katherine Roe Panmure Gordon (UK) Limited Tel: [phone]

Simon Hudson / Kelsey Traynor Tavistock Communications Tel: [phone]

Notes:

Borders & Southern Petroleum plc is an oil & gas exploration company listed on the London Stock Exchange AIM (BOR). The Company operates and has a 100% interest in five Production Licences in the South Falkland Basin covering an area of nearly 20,000 square kilometres. The Company has acquired 2,862 km of 2D seismic, 1,492 square kilometres of 3D seismic and drilled two exploration wells.

This statement has been reviewed, verified and approved by Dr Howard Obee, (a petroleum geologist with 25 years relevant experience, Fellow of the Geological Society and member of the American Association of Petroleum Geologists and the Petroleum Exploration Society of Great Britain), in accordance with the Guidance Note for Mining, Oil and Gas Companies issued by the London Stock Exchange in respect of AIM companies.

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