Borders & Southern (AIM: BOR), the London based independent oil and gas exploration company with assets offshore the Falkland Islands, announces the results of an independent evaluation of the Darwin East discovery and the adjacent Darwin West untested fault block.

Highlights

• Substantial increase in estimated resource. Un-risked Best Estimate total recoverable liquids (condensate and LPG) for Darwin East and West is 462 MMbbl.
• The geological chance of success of finding hydrocarbons in a well located on Darwin West is assessed to be 0.81.
• Borders & Southern asked Gaffney, Cline & Associates (GCA) to perform an independent evaluation of the Darwin East gas condensate discovery along with the adjacent, technically similar fault block, Darwin West. GCA was given access to the Company's extensive 3D seismic and well data, including technical studies, interpretations and dynamic models of the reservoir.

GCA's comprehensive analysis confirmed Borders & Southern's geological interpretations and derived the following estimate for Wet Gas Initially in Place:

Estimated Wet Gas Initially In-Place (Bscf)

It was noted that the untested Darwin West fault block displayed very similar seismic characteristics and attributes to the Darwin East fault block. The geological chance of success of finding hydrocarbons in Darwin West was assessed to be 0.81.

Composition analysis of the hydrocarbon samples collected in the Darwin discovery well (61/17-1) demonstrated that the gas is a very rich, sweet gas capable of producing liquid condensate and LPG. Borders & Southern has previously discussed development concepts whereby the liquid condensate could be produced and the "dry" gas re-injected back into the reservoir, allowing it to be available for a future LNG project, subject to commerciality. GCA's work investigated the potential to produce the LPGs (Propane and Butane) in addition to the condensate. They prepared a revised Equation of State model of the rich gas and updated the dynamic reservoir model for Darwin East and Darwin West. Utilising six vertical production wells and four vertical gas injector wells (five wells on each fault block) they derived the following best estimate:

Best Estimate Gross Contingent & Prospective Resources (un-risked)

The above volumes were based on a combined development of the core areas of both structures into a single FPSO, with 480 MMscf produced gas. Total recovery of liquids from the 25 year period evaluated is 462 MMbbl. The combined liquids production of condensate and LPG peaks at 91,100 bbl/day.

The Company will comment further on the economic impact of these new resource estimates in the announcement of final results for 2017, due at the end of March 2018.

Chief Executive, Howard Obee, commented:
"We are delighted with the results of this independent evaluation. It reaffirms our belief that Darwin East and West represent a very material resource. And with the recent recovery of Brent crude we are optimistic that this evaluation will assist in our efforts to secure partners and funding for the next phase of drilling."