Rockhopper's doubts over the Falklands' oil estimates

The company, which has discovered commercially viable oil at the Sea Lion well, warned that it lacked sufficient data for a planned technical report to support its preliminary resources estimate.

But it added that it was "very confident" about the commerciality of the discovery and "comfortable" with the existing resources estimate.

In June, Rockhopper gave a best estimate of 242 million barrels of oil at the well, the first oil find in the British governed Falk-lands.

Analyst Richard Rose at Oriel Securities said it was likely that this would be revised closer to 170 million.

The broker said: "Until further appraisal wells are drilled in the field, it is very difficult to extrapolate accurate resource estimates and the range of potential outcomes will remain in a very wide range.

"The shares will inevitably get hit but our view is that Sea Lion is a commercial discovery and any significant pullback would represent a buying oppor- tunity."

Rockhopper shares plunged 21 per cent to 363p yesterday, still a long way above the 50p price they were trading at before the discovery was announced in May.

Rockhopper also said it was planning to extend its drilling campaign in the North Falklands basin, but was likely to need more funds to do so.

It said it had identified "attractive" new targets and was in talks with the owners of the Ocean Guardian rig for a new three well contract and five options extension.