Rockhopper Exploration, one of several companies drilling for oil off the coast of the Falklands Islands, yesterday doubled the production forecasts of a well in the region.
In May, when Rockhopper first found oil in its Falklands block, it said that the Sea Lion 1 well was capable of producing 2,000 barrels a day. Yesterday, the group amended the forecast, doubling its estimates. The company said that constraints in the original tests had limited the potential flow of oil.
"With a more optimal well location and horizontal well completions, significantly higher flow rates could be achieved from future production wells," Rockhopper said in the statement.
Rockhopper's shares have put on 855 per cent in the past six months, making it the most successful of the four companies exploring the seas off the Falklands. Last week, the company said that its wells would be commercial viable, leading to a further 50 per cent hike in the stock.
But the exploration has also proved highly controversial. A huge diplomatic row erupted earlier this year when Argentina repeated sovereignty claims over the Falklands and exploration rights in her territorial waters. The UK and Argentina fought a war over the islands in 1982 after the former Argentinian dictator General Galtieri invaded.
Desire Petroleum, which has also explored the same basin as Rockhopper to the north of the islands, yesterday raised a further £22.8m from investors as it seeks to emulate Rockhopper's discovery.
Desire said it needed more 3D seismic data coverage of its acreage to identify a possible deposit fully. "Desire believes that it is essential that it acquires and processes new 3D seismic data as quickly as possible in order to fully understand the potential of this play," it said in a statement.
Another British group, Falkland Oil and Gas, has drilled a prospect south of the islands, but said in August that an exploratory well was dry. It is now in a joint venture with the mining giant BHP Billiton and trying to secure a deepwater rig to explore further.