The North Falkland Basin
An Emerging Oil and Gas Province

Argos Resources Ltd is a quoted oil and gas exploration Company based in the Falkland Islands.

The Company's principal asset is a 100 percent interest in Production Licence PL001 covering an area of approximately 1,126 square kilometres in the North Falkland Basin.

Argos placed £22m of new shares which commenced trading on July 29th 2010. The funds were raised to undertake a 3D seismic programme during the austral summer of 2010/2011 over the prospects identified from its earlier 2D seismic. The intention was to better define those prospects, and potentially to identify new prospects, leading to the selection of possible targets for a subsequent drilling programme in Q4 2011 and 2012. The Company announced in October 2010 that it had contracted the MV Polarcus Asima to undertake this 3D programme, seismic acquisition commenced in January 2011 and was completed in May.

1415 sq kms of 3D seismic was acquired to cover the entire licence area. The quality of this new data is excellent and results obtained from its interpretation are highly encouraging. The new 3D data has confirmed the presence of all six structural prospects that were mapped from the reprocessed 2D seismic data and that were described in an earlier CPR by Senergy in June 2010. The 3D data has achieved better data quality and fault definition and has therefore improved confidence in the mapping of these prospects.

A total of 22 new combination structural and stratigraphic prospects have been mapped that were not apparent prior to the 3D data being acquired. Additional leads, not included in the above numbers, have also been identified and are the subject of ongoing mapping.

Prior to the 3D programme, the Best Estimate of unrisked prospective recoverable resource potential within the licence area was 747 million barrels, based on the interpretation of reprocessed 2D seismic data. Following the results of the 3D seismic data and the many new prospects identified, a new Competent Persons Report has been prepared by Senergy (GB) Limited. Based on that report, the Best Estimate of unrisked prospective recoverable resource has increased to 2,107 million barrels with a High Estimate case of 7,297 million barrels.

This considerable increase in identified potential in the licence means that the 3D seismic programme has been highly successful and the Company now has a large prospect inventory supported by excellent quality data.

The Company is progressing with preparations to drill. An Environmental Impact Statement was submitted to the Falkland Islands government in April 2011 and approval was received in September. The preparation of an Oil Spill Response Plan is well advanced.