Rockhopper to raise £48m to exploit Falkland Islands oil

Oil explorer Rockhopper today announced a £48.5 million cash call to help it to mine the reserves it has discovered off the Falkland Islands.

Independent forecasts last week said Rockhopper's Sea Lion oil well held 242 million barrels of recoverable reserves, considerably more than the original estimate of 170 million barrels.

Today Rockhopper followed up the news by announcing plans to issue more than 17 million shares at 280p each in a fully underwritten placing. The shares are being offered at a 3.5% discount to the stock's closing price yesterday of 290.25p.

Rockhopper said it would use the resulting £48.5 million to carry out flow testing at the Sea Lion well and drill further at its Ernest Prospect, at another site off the Falkands.

Relationships between Britain and Argentina have come under renewed pressure this year after British oil explorers, including Desire Petroleum, began searching for oil in the remote territory.