Business

Falklands oil exploration stalled amid falling oil price

  • 13 April 2015
  • From the section Business
Oil rig off Falkland Islands
Image caption An oil rig in the South Atlantic ocean, off the Falklands

Oil drillers in the Falklands have shelved plans to drill a second well in the south and east of the region, following the steep drop in oil prices.

The move involves three oil exploration companies, Falkland Oil and Gas (FOGL), Edison International and Noble Energy.

They will continue their operations in other parts of the region, but need "disciplined capital management in the current oil price environment".

The price of Brent Crude has almost halved in the last year.

The announcement also follows Argentina's ramping up of political pressure on the companies last week.

The disputed sovereignty of the Falklands makes drilling there controversial.

FOGL initially planned to explore five oil wells in the region in 2015.

Oil explorers globally have scaled back drilling work to control costs amidst the steep decline in oil prices.

Shares in FOGL opened 4.3% higher as investors saw the news as positive.

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