08 Borders & Southern Petroleum plc Annual Report & Accounts 2014 BUSINESS MODEL & STRATEGY OUR BUSINESS MODEL IS  ALL ABOUT VALUE  CREATION THROUGH  THE DISCOVERY AND  APPRAISAL OF  HYDROCARBONS. 2. Explore COMMENCE OPERATIONS 1. Access NEW OPPORTUNITIES The first stage is to access new  opportunities, either through Licence  Rounds or Open Door policies. Our Exploration work is underpinned  by rigorous petroleum systems  analysis. Operations will typically begin with  a 2D seismic survey, with limited  financial exposure. Our Frontier Exploration strategy  directs us to focus on untested or  emerging basins where significant  acreage positions can be accessed at relatively low cost. If positive results are gained from  the 2D survey, giving confidence in a  working source rock, reservoirs and  trapping geometries, then further  investment in 3D seismic will be made. Following detailed analysis of the  3D survey a prospect inventory will  be generated, prospects risks and  volumetrics assessed. Comprehensive technical screening  prior to access helps mitigate  geological risk, however the project  risk profile is relatively high at  this stage. Economic modeling of fiscal terms  and potential discovery volumes is  undertaken to ensure project rewards  merit the investment decision. Finally prospects will be high-graded  for drilling and a rig mobilised. OUR TECHNICAL WORK  IS MAKING GREAT  STRIDES FORWARD. WE NEED TO SECURE  PARTNERS IN ORDER TO  TEST OUR GEOLOGICAL  MODELS BY APPRAISAL  DRILLING. PROGRESS IN 2014 PROGRESS IN 2014 OUTLOOK OUTLOOK •  We continue planning for the  Darwin appraisal and further  exploration wells •  We are working on fully evaluating  the inversion data in the Early  Cretaceous shallow marine focus  area and assessing the potential  of the slope and basin floor  portfolio •  Whilst the Company seeks to get  a partner to fund the next phase  of activity, we do not intend to add  additional licenses outside the  Falkland Islands •  The Company’s acreage in the  Falkland Islands covers an area  of around 10,000km 2 . Only  2,500km 2  is covered with 3D  seismic so there is ample room  for further exploration within the  Company’s existing licenses •  Received merged 3D PSDM  seismic data volume and  commenced interpretation and  undertook a seismic inversion  project to help de-risk the  portfolio and identify additional  targets