Rockhopper Exploration might sell a majority stake in the $2 billion project as it expects to find a partner to invest in its discovery offshore the Falkland Islands within three months.

During a conference last week Rockhopper executives said that seven or eight companies were interested in bidding, according to investment bank Morgan Stanley.

A research note from the bank said the UK-based company could give up its lead role in the Sea Lion field it believes it could have 1.3 billion barrels of oil in place.

The note mentioned that "Rockhopper would be willing to relinquish operatorship, if the farm-down interest was high enough."

The executives told the conference Rockhopper was giving would-be bidders access to its data. This due to the company needing money and expertise to fund the development in an area that is the subject of a territorial dispute between Britain and Argentina.

An oil analyst at the investment bank Macquarie, which also hosted an investor conference at which Rockhopper presented last week, said in a research note he expected the company to sell a 50 percent stake in its interests in return for the partner bearing all the cost of developing the project.

This limits the list of potential acquirers to well-funded companies, ideally with strong cash flows from production.

Shares in the company increased by 10.0 percent, their highest level for over six months, trading at 302.5 pence at 1204 GMT, valuing the company at around $1.3 billion.

Rockhopper was likely to see strong interest in the stake according to analysts from Bank of America Merrill Lynch.

"The significant exploration upside potential that the acreage still offers could prove a strong 'pull factor' for bidders - particularly those with limited exploration newsflow," they said in a note on Monday.

Rockhopper unveiled plans for a $2 billion project to transform the remote Falkland Islands into an oil production centre last year. They said in October that they had been approached by industry partners looking to co-invest with it on the project.

An online data room towards the end of 2011 to allow interested parties to prepare a bid is planned to be open.

Industry sources said Edinburgh-based explorer Cairn Energy talked to Rockhopper about a possible tie up but after deciding to return $3.5 billion to shareholders, analysts think Cairn will need its remaining cash to fund its Greenland operations.

Tags: Rockhopper Exploration plc