Argentina ends Falklands oil deal

Discussion in 'Current Affairs, News and Analysis' started by sniper_bob, Mar 28, 2007.

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    What would the Argies benefit by pulling out of this co-operation?

    If the UK are leading the initiative and we have the only suitable islands in the area where the billions of dollars of oil can be refined and stored, the Argies lose potential revenue by pulling out.

    If the UK cedes on the issue to sovereignty we lose our right to the oil and to the Islands, bit of a no-brainer. Argie flag waving in advance of the 25th anniversary or another front opening in the oil war?
  2. They are playing to the home political audience - if the Argies were any good at economics their Country would not be a basket case. Future Generations will have time to regret this act, utter muppets.

    Should be good for the UK exploration Co's share price though!
  3. No doubt a series of naval "exercises" will follow to further play up to the home audience. Something akin to the "Cod war" is quite plausible I would have thought.
  4. Argentina says co-operation with the UK had to be linked to reopening talks over the sovereignty of the islands.
    I thought that these 'talks' were concluded a little under 25 years ago!
  5. Can't see Brown spending any money to keep the Falklands secure. I guess the Argentine government feel the same.

    On the other hand Brown, thinking of how he would look like a hero, might send an under-manned, ill-equipped force of 'his' Armed Forces to kick the Argentines off!

    Hurry, hurry, hurry the next General Election.
  6. We could re-direct and despatch our South Atlantic Flotilla from its current task of ensuring the safety of UK trade lanes and shipping operating between the Pacifc and South Atlantic Oceans. SSN assets redeployed along with Marine Commando Carriers to send a strong signal to the Argentin ........................ **** where am I? Oh I must have been dreaming - I thought we still had the ability and political will to project power against mad barstewards who attacked us 25 years ago!
  7. Potential revenue is all it my knowledge there b*gger all going on down there at the mo. Was talk of the town in the 90's but has died a death. IIRC a few wells drilled, but not a lot proven.

    So this is more a symbolic jesture.
  8. They have shot a lot of seismic data in the last couple of years but drilled no prospective wells.

    This is a very strange decision by Argentina as if they do ever find anything there (its a big 'if') then they could miss out. However, I suspect that they would suddenly smell the coffee and change their mind, as Oil development in that part of the world without access to mainland infrastructure would be difficult and they know it.
  9. I seem to recall that one of the smaller oil companies wants to drill in the area to confirm its data but can't find an oil rig because they are all so busy elsewhere in the world (presumably, on better prospects).

  10. BP or Shell had a rig in the FI in the late 80's (87 IIRC). Reason - training purposes! Yeah - OK.
  11. Also, it's a lot of money to take a rig to somewhere out of the way with more serious sea conditions than those encountered in the Persain Gulf or Gulf of Mexico.
  12. Falkland Oil and Gas own the majority of drilling and exploration rights - they are part owned by Global Petroleum and Hardman Resources.

    Global (who own 77% ish), have just drilled a succession of wells in East Africa and the Far East, allof which has come up dry - conseqently their share price has gone from 30p to around 7p on the AIM stock market.

    Hardman Resources, which is an Australian company, was recently bought out by Tullow Oil of Ireland, and are concentrating on exploring offshore Australia in the Bass Strait fields.
    Australian drilling dictates units that are deep water ops capable (Semi subs, drill barges etc etc) which are chuffing expensive (about USD 250k for an average capability semi with drill pack).

    This means that all the available money is being ploughed into Hardmans australia ops, and none is left over to bank roll a drilling operation in FI - also bearing in mind that they only own 22.5% of the FOGL shares, their return on investment is extremely low.

    As FOGL have no money available to spend, the only way they will be able to drill even exploration holes in their sectors would be convince another contractor to drill on a PSA (production sharing agreement) basis, whereby the rig contractor gets paid a % per barrel extracted. As there is no real basis to say theres any oil or gas down there aside from the seismic (which usually only shows peaks and troughs in rock type, indicating that there *might* be someoil or gas there), its a bit of a long shot for a rig owner to mobilise a unit to the Falklands, drill some wildcats, and then mobilise the rig back to somewhere like Singapore or Mexico - your talking about 20m USD lost in charter hire, and a further 20m for the heavylift vessel to transport the units to and from the Falklands. Additional to this cost is the provision of an anchor handling tug to reposition the rig from one well location to another, as well as supply the rig itself with men + food + drilling pipe etc etc. Current north sea rates for an anchor handler are around 80,000 GBP a day......

    In todays market, rig operators are able to place units in the Gulf of Mexico ( specifically mexican waters) very easily on charter to Pemex (Mexican Govt oil co), Sakhalin (Rosneft, Venineft, Sinopec), West Africa (ENI, Shell, BP et al) or the Far East (Anyone and everyone) with guaranteed charter rates, paid mobilisation and no headaches.
    North Sea drilling is sewn up by the Norwegians and larger US operators, as the rigs themselves need to be harsh water capable and of the highest standard.

    Annnnd - most low cap oil companies (SOCO, JKX, Global, Venture) will only make money when the price of oil extracted stays above USD55 - thats for North Sea light sweet. Bearing in mind they do not know the quality of the oil and gas that could be produced, there are capital outlay issues that cannot be accounted for, and therefore no one will bother to drill (they cant take advantage of it even if its there).

    Sermon over.
  13. The penny has probably dropped with the Argies and after ten years of Labour and Bliar they are probably aware of our virtually mothballed Navy,undermanned,underequipped and over extended army and weak political leadership who'd rather negotiate the Falklands away than fight for them.
    Its no suprise its happened at this particular time as well!!!!
  14. I seem to remember the ratio of forces (attacking to defending) in an assault was a minimum of three to one. Why then did Maggie allow our Fallklands heroes to attack a force much greater than ours.

    Lsquared, Your posts all seem to be in the same vein, and do not do You justice.

    And to answer Adamas post, weren't we in the process of mothballing the fleet then?

    Edited for spelling and the last paragraph