UPDATE 1-Rockhopper raises Falklands discovery estimates

* Ups new low case Sea Lion estimates of oil in place

* Says at mid-case estimate, discovery could produce 325 mln barrels (Adds detail, background)

LONDON Aug 15 (Reuters) - British explorer Rockhopper Exploration PLC upgraded its estimates of how much oil it could find off the Falkland Islands, boosting hopes that the remote territory could become a new oil province.

Rockhopper said on Monday that new seismic data indicated that its Sea Lion discovery in the North Falkland basin could extend further than it previously thought, as it raised its low case estimate of oil in place to 608 million barrels from 516 million.

Rockhopper is one of a number of explorers drilling in waters off the coast of the British-governed Falkland Islands, over which Argentina claims sovereignty. Drilling is ongoing to try to establish whether there are sufficient quantities of viable oil to justify investing in infrastructure.

"We are highly encouraged by the interpretation of new seismic data which identifies both significant reservoir extension and the existence of two additional fan prospects above and beneath the Sea Lion Main Complex," said Chief Executive Sam Moody in a statement.

Rockhopper called the two additional prospects Caspar and Kermit and said they could hold significant further resources.

Using the company's mid-case estimate of resources at the Sea Lion discovery and based on a recovery factor of 30 percent, 325 million barrels of oil could be produced from the field, it said.

Depending on the results of an appraisal well which it will start to drill shortly, Rockhopper said it may choose to drill other wells in addition to the three remaining wells scheduled.

Shares in Rockhopper closed at 217.8 pence on Friday, valuing the company at 562.5 million pounds ($915 million). ($1 = 0.614 British Pounds) (Reporting by Sarah Young, Editing by Rosalba O'Brien)