The two have some striking similarities, despite being almost at opposite ends of the globe. Cairn Energy will be drilling prospects in the Baffin Bay Basin off West Greenland, while Rockhopper and Desire Petroleum are drilling off the Falklands. Both areas have yielded six non-commercial discoveries in the past, and have ‘surprisingly benign’ drilling conditions. Cairn Energy is spending $300m on a rig off Greenland while Rockhopper/Desire are spending $80m.
Here is Bernstein’s breakdown :
As for estimates of the holdings; USGS has come up with 17bn barrels of oil equivalent for West Greenland, while an unrisked estimate puts the Falklands at more than 10bn boe.
Bernstein estimates the economics of production from the two areas as being similar, although the Falklands would yield a better rate of return. Despite this, they are more keen on Greenland, mainly due to reports of oil leaks – which are thought to be a good indicator of reserves – and the less explored nature of the area.