fogl, page-5

Tuesday 3rd May 2005

Falkland Oil and Gas Limited
(“FOGL” or “the company”)

Significant increase in number of identified leads
Enhanced possibility of a new petroleum province in the South and
East Falkland Basins
FOGL announces that it has completed its current 9,450 km 2D seismic data
acquisition programme over most of its licence area. The initial interpretation of the
preliminary processed records from the survey has proved encouraging and greatly
exceeds the Company’s initial expectations.
The programme has indicated a larger and more diverse project than originally
anticipated and has identified numerous possible drill targets, with indications that
some could potentially be of significant size.
FOGL has now identified approximately 130 leads,¹ far in excess of the eight (8)
leads identified at the time of its AIM IPO in October 2004. Given the positive
results of the survey, FOGL now plans to increase the scope of its exploration
programme far beyond that envisaged at the time of the IPO.
Key points:
􀂾 Approximately 130 leads identified, a number of which appear capable of
containing recoverable reserves in excess of 200 million barrels
􀂾 FOGL now represents a larger and more diverse project than originally
anticipated
􀂾 Encouraging signs that oil and gas could be present
􀂾 Further work is planned targeting defining 20 drillable prospects by about
mid-2006
􀂾 FOGL is targeting drilling of the first well in 2007
􀂾 Already an enhanced possibility of project success
􀂾 Licences cover area equivalent to the North Sea Southern Gas Basin and
Central Graben
􀂾 Cash position of £10.9 million as at 31 March 2005. FOGL is evaluating its
funding requirements and the source of funds for the increased exploration
programme

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http://www.fogl.co.uk/fog/pdfs/May%20exploration%20update.pdf