ROCKHOPPER Exploration plc has entered into a billion dollar conditional farm-out agreement with Premier Oil plc which will acquire 60 per cent of Rockhopper's interests in its  North  Falkland Basin licences.

The deal provides that Premier become the operator of the Sea Lion development, while Rockhopper will take the sub-surface lead on exploration activities.

Stephen Luxton, Director of Mineral Resources for the Falkland Islands Government said:

"We are delighted by the news that Premier Oil plc is joining forces with Rockhopper Exploration to develop the Sea Lion field.  It opens the next chapter in the story of Falklands offshore activity, it brings another capable and well-funded partner into the region, and it confirms our belief that the Falklands offers an exciting range of opportunities for the oil industry.  FIG will continue to work closely with both Rockhopper and Premier Oil to move the Sea Lion field forwards towards production."

Hon. Dr Barry Elsby, Member of the Falkland Islands Legislative Assembly said:

"This is fantastic news for the oil industry and the Falkland Islands, and is something we have been anticipating since Rockhopper announced their commercial discovery in the Sea Lion field.  This announcement clearly demonstrates how positively industry view prospects in the Falkland Islands.  The Falkland Islands are an excellent investment destination, and we look forward to working further with industry over the coming years."

Full story in Friday's Penguin News