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FALKLAND ISLANDS GOVERNMENT WELCOMES ROCKHOPPER EXPLORATION’S ANNOUNCEMENT ON TAX

Following Rockhopper Exploration’s announcement today regarding tax arising from the Sea Lion farm-out, the Falkland Islands Government Treasury is pleased to confirm that an agreement has been reached with Rockhopper Exploration.

“The Treasury welcomes the successful completion of discussions with Rockhopper Exploration PLC over the sum payable to the Falkland Islands Government Treasury resulting from its sale of a 60 per cent stake in the Sea Lion oil field to Premier Oil in 2012.

The Falkland Islands Government and Rockhopper Exploration have now agreed in principle that the total tax payable is USD$146M with payment split into two tranches, the first of $42M due immediately (the majority of which has already been received) and the remainder payable alongside the first royalty payment on oil production.

The Falkland Islands Government remains committed to maintaining its stable and competitive top quartile fiscal regime for hydrocarbons development. FIG sees this agreement in principle with Rockhopper Exploration as an important milestone that reflects its ambition and firm commitment to provide a reliable framework for sustainable long term oil industry investment in hydrocarbons exploration and development within the Falkland Islands.”

Nicola Granger, Commissioner of Taxation, FIG

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