2. BHP Billiton
• BHP Billiton farmed in 2007 paid US$13 million & 68% of all exploration costs to earn a 51% interest
• The joint venture has since spent over US$110 million, resulting in a net saving to FOGL of
US$75 million due to the farm-in carry
• BHPB have made a strategic decision to exit the Falklands
• Agreed that BHPB will make a US$40 million contribution to the cost of the Loligo well
• BHPB retain a back-in right for up to 40% on the Loligo prospect only
• BHPB’s involvement has saved FOGL shareholders c.$128 million = £80 million
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4. Drilling programme
• FOGL is currently planning a 2 well programme commencing in Q1 2012
• First well on Loligo, identity of 2nd well dependent on results
First well Options
Successful Loligo appraisal
result
Loligo
Nimrod
4700* mmbbls
1500* mmbbls
Disappointing
result Vinson
733* mmbls
Scotia
1062* mmbbls
Hero
1071* mmbbls
Dependent on Borders & Inflexible
Southern’s Darwin result 253* mmbbls
* Pmean prospective resources (mmbbls)
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5. Costs
• FOGL has sufficient funds (c.$160 million) to drill a deep well on Loligo and a second well
from: Loligo (appraisal), Nimrod, Vinson or Inflexible
• FOGL is not fully funded for a second well on Scotia or Hero
Mobilisation costs
• Rig & equipment mobilisation: c.$60 million gross (shared with Borders & Southern)
Well costs:
• Loligo (4000m TD, est. duration 50 days): c.$65 million
• Nimrod/Vinson/ Inflexible: (3000m TD, est. duration 40~45 days): c.$45~55 million
• Scotia/Hero: (5000m TD, est. duration 65 days): c.$80 million
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