LONDON (Alliance News) - The oil and gas companies involved in the Horse Hill project in the Weald Basin, southern England, Wednesday said they have received a new independent calculation that states there is 10.99 billion barrels of oil in place.
This is the fourth estimate the companies have received, and this latest estimate is higher than the last forecast of 9.24 billion barrels of oil in place. However, how much of the oil can be recovered is still unknown.
Horse Hill Developments Ltd owns a 65% stake in the Horse Hill prospect and the remaining 35% of the prospect is held by Magellan Petroleum Corp.
UK Oil and Gas Investments holds a 30% stake in Horse Hill Developments, whilst Doriemus PLC, Stellar Resources PLC, Solo Oil PLC and Alba Mineral Resources PLC each hold 10% stakes in Horse Hill Developments, with Evocutis PLC holding a 2% stake and the balance is owned by Angus Energy, in which UK Oil & Gas has a 6% stake.
The latest 10.99 billion barrel estimate was provided by Schlumberger and covers a 55 square mile area over the PEDL137 and PEDL246 Horse Hill licenses. Of the estimate, 8.26 billion barrels is thought to lie in the Kimmeridge Clay formation, 1.71 billion barrels in the Lias formation, and 1.01 billion barrels in the Oxford Clay.
All of the previous estimates, including this latest figure, exclude the underlying Jurassic tight oil plays which lingers beneath the Kimmeridge, Lias and Oxford Clay formations.
"The independent analysis has further tested and given support to our geological model which predicts that the significant volumes of oil in place calculated within the tight Jurassic section of HH-1 extend across the Licence Area. The report is thus a further step towards establishing proof of concept for the Jurassic tight oil play potential of Horse Hill and the Weald Basin," said UK Oil and Gas Chairman Stephen Sanderson.
Although the figure is the largest of all the independent reviews carried out, the amount of oil that can actually be recovered is still unknown.
"As previously stated by the company, the above estimated OIP hydrocarbon volumes should not be construed as recoverable resources or reserves and also should not be construed in any way to reflect potential producibility of hydrocarbons from the formations evaluated," said the companies in separate statements.
The companies said they will now press ahead with a flow test on the Horse Hill-1 well, whilst also evaluating those deeper Jurassic tight oil plays to see if this can further increase the amount of oil in place.
Although the 10.99 billion barrel figure is large, it is far from the 100.0 billion barrel figure that UK Oil and Gas Investments Chairman David Lenigas was quoted estimating by the Evening Standard earlier this year, which caused the company to clarify the figure of recoverable resources was not known.
In May, the companies said the PEDL137 license, part of the Horse Hill project has the "potential production period of 19 years", but also that only between 3% to 15% of the oil in place at Horse Hill is ever likely to be recovered.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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