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Wizard,

apart from not being a published CPR statement (it was in an RNS after the initial testing), it also isn't that simple:-

'oil recoveries of up to 45% of connected Oil in Place could be attained if a successful full voidage replacement pressure support scheme is incorporated into the field's development.'

So connected oil (7 to 11mmbbls per well) and a 'successful' full voidage replacement pressure support scheme' required …..and 'could be attained' and it's 'up to' 45% (which at sales I've been to could mean anything).

I'm still waiting fo a Xodus explanation of why the 40 to 60 % water saturation throughout the Portland isn't being seen in production:-

From the 2018 CPR based on the Portland 2016 testing, and the only CPR rated assessment of the Portland at HH to date:-

'The well test was conducted over the entire Portland interval of 100ft. In this zone the water saturation is relatively constant between 40 and 60%.'

&

'Xodus agrees given the permeability profile and other available data it is a reasonable assumption that the entire Portland zone has contributed to flow, as in the model suggested by Nutech. However, there is no definitive evidence at this time and other scenarios may explain the lack of water production during the test which cannot be discounted at this time.'
.
So not sure why no water at that stage, and still no water being produced.....intriguing....and they didn't mention what these other scenarios might be.

Just read the following statement in the 10/9/18 RNS: (the robustly commercial one)-

.....that further HH-1 Portland vertical well optimisation could achieve a forecast sustainable initial 24/7 pumped rate of around 362 barrels of oil per day ("bopd")* when full scale long-term production commences

HH-1 Portland vertical is not ultimately going to be a Portland producer, it is the donor well for the HH-1z Kimmeridge horizontal appraisal well - so when will the promised 'full scale long-term production' of HH-1 in the Portland be happening?

I'd assume it's what is going on at the moment which begs the question why 200+ bopd, why not optimise and produce at the fabled 362bopd (which gives the 720 to 1080bopd, 2 to 3 times the vertical well's production), or was that just a short term 'target' - 'initial' - the OGA appears to be amenable to increasing the limits - and even more cash in the pot to pay for the upcoming work programme?

But the Portland is only a target in structural closures

Very little is said about the Kimmeridge these days (yea I know, keeping schtum while 'hoovering up' acreage), with slow progress towards a CPR that confirms even the minimal information about the likely production from the Kimmeridge just at Horse Hill (1mmbbls per well and similar initial production to the Portland), let alone anywhere else, is still awaited. With an anticipated 3mmbbls over 20 years from the Portland per well (if the proposed pressure support scheme of 2 injectors to 3 producers, currently not the plan, is invoked - and works) this suggests a massive difference in decline rates predicted for the 2 levels.

missed this bit....

or between 204 and 208 tankers for the revised 5830 tonne limit (+10% to the original 5300 tonne limit).

Free money,

Yesterday you replied to my post about the increase in OGA permission for production during this ewt with a statement about the increase I posted being out of date.

Funnily enough my post was at 9:45. At 11:00 wealdoilers (AKA pboo) tweeted a screen grab of the email I referenced in my post, and then you posted at 11:10:-

'They increased it by another 10% on 18th April........ Keep up :-)'

Well actually they didn't increas it by another 10% on 18th April. If you had read my post and the tweeted email you would have seen that the email was a reply from the OGA to a FOI request dated 18th April, but about the 29th March increase which I had posted about.

Also pboo assumed a tanker of oil was 25 tonnes arriving at a higher figure than my 206 tankers (233). But depending on the API of the oil 215 barrels of oil wIll weigh between 28 tonnes (41 API Kimmeridge oil) and 28.55 tonnes (Portland oil) or between 204 and 208 tankers.

I'm using 215 barrels as the 'over' 40,000 barrels in 186 tankers (RNS 11 April) equals about 215 barrels per tanker.

If that rig doesn't arrive soon they're going to need another increase.......

Freedom of information answer on 'whatdotheyknow'

On Friday 29 March 2019 the OGA consented to the variations subject to the following conditions:

• The permitted total oil volume produced during the test period is no greater than 5830 tonnes

• The permitted total gas volume produced during the test period is no greater than 330,000 m3

• The Operator must not exceed 180 days of flow, as per the consent granted on 13th June 2018

That's about 206 tankers assuming 215bbls per tanker and an average API of 40 - Kimmeridge oil 41 API, Portland oil 38 API.

Just for information.

gkb,

So you think that in production that they don't bother with prudent reservoir management, it's just something they do during testing. As they won't be producing from the Portland section in HH-1 the formation near the well won't even be close to the HH-2 horizontal so they could test to see what it really could sustain. I'm always a bit worried about UKOG's confidence, it was used a couple of times during BB.

Oakleak,

You (and I) have no idea what steps were necessary to acheive the optimised rate but there have been a number of workovers since that statement, but I do notice the word 'initial' in that extract. Maybe they didn't want to illustrate exactly how long initial meant.

Wizard,

I already said that they would require permission which they must have got. Anyway I keep seeing posts claiming they are flowing 2 tankers worth a day - perhaps you should point out to them your theory.

Nice sunny day, so Happy Easter.

gkb 47,

Someone posts this every now and then - but during production they will also 'protect' the reservoir, limiting the flow rate to avoid damage. It's unclear why the current production rate is set so low, the calculated sustainable rate was 362 bopd.

As the OGA production limit of 5300 tonnes has already been exceeded this must have have been revised upwards so that doesn't seem to be the reason.

Bag of Sand

Forgetful?

From the UKOG web site:-

'Our primary objective at Loxley-1 is to appraise the gas discovery made in the 1980s at Godley Bridge, which extends for about 10km and underlies Dunsfold aerodrome.'

From the 2018 CPR:-

'The Godley Bridge gas field was discovered in 1982 by Conoco with the well Godley Bridge-1, which tested gas and a small amount of condensate from Upper Jurassic Portland Sandstones.'

Heid,

It is interesting that the real focus seems to be the Portland - is the Kimmeridge is a secondary target? - yet the Kimmeridge is the multi multi billion barrels of OIP that's of national significance, not the Portland.

BB doesn't have a Portland prospect, it was going to prove that a structural element wasn't necessary for the Kimmeridge to work, UKOG has suggested a reason for failure but has yet to return to BB - or even apply for planning to do so.

Yet again we see that no other company is interested in Weald licences, even at these 'bargain' prices.

Why not give them cash and if they really wanted UKOG shares they could have bought them in the market, though it doesn't sound like Europa will be holding on to them, and I suspect UJO won't either.

Even when a CPR for HH Kimmeridge is issued it still won't 'prove' the rest of the Weald. It is going to be a long wait to see if SS has played a blinder buying up the Weald..

Soupy,

assuming that comment is in reply to my post - did you not read this bit...…. 'do the deal now'?

the idea being to replace the money spent at a later date (after the 2 new drillls).

The wells are meant to cost about £3mm each (though the sidetrack ought to be a bit less and UKOGs share, depending on what happens with Tellurian, between about £3mm and £4.5mm.

So plenty of headroom for preparations for other 2019 work programme items and assuming these wells are drilled soon the testing bonanza will be in full flight by mid year.

Also if the 'deal' is so good it shouldn't even have a dilutive effect.

With the £12mm that was supposedly still in the coffers why doesn't UKOG use a bit of that to do the deal now. Drill the horizontals and then place at a (presumably) higher SP?

Although the money for the 2 upcoming drills has probably already been passed to HHDL so contracts can be signed and money put in escrow that should still leave plenty of spare cash for whatever deals SS wants to do.

So the 720 to 1080 bopd figure is nothing more than a simplistic calculation (2 to 3 times, and with caveats) based on a (calculated) targeted sustainable flow rate in the vertical well which was previously said to result from 'optimal' conditions.

'conforming with the established petroleum engineering benchmark that an optimally placed horizontal well within a reservoir with reasonable vertical permeability can be expected to deliver 2 to 3 times the flow rate of a vertical wellbore from the same reservoir.'

What's needed is the CPR that properly calculates the figures for these horizontal wells that are about to be drilled based on a reservoir model, not an 'established petroleum engineering benchmark' that means that Xodus has complete deniability if these figures are wrong?

Maybe they will be better, maybe worse - but at least they will have been derived from the ewt data not a 'benchmark'.

Investors are basing their projections of value based on these numbers that are nothing more than educated guesses.

Tony,

You say that there are 2 tankers most days.

I've seen others claiming that as well.

But, based on your and others twitter feeds it's only an average of about one tanker a day six days a week.

On 15th March at 7:10 am the number of tankers according to UKOG was 165.

According to your tweets and retweets on April 2 tanker 182 left and on April 4 there were 2 tankers making 184 tankers, there were no other tankers mentioned since April 2nd on other feeds either.

Of course there are no tankers allowed on Sundays but even excluding Sundays there' have been 18 days since March 15th up to and including yesterday and 19 tankers.

It looks to me that UKOG is keeping the their RNS'd test production of just over 200 bopd

Alan,

I wonder how certain they are as to the location of the water zone.

In a normal reservoir the expectation would be that it's at the bottom but with a supposed continuous resource that's wouldn't be a given. There certainly wasn't any mention of the Kimmeridge not being continuously oil bearing, and they surely wouldnt have knowingly perforated a water zone.

A possible situation is an open fault acting as a conduit from a deeper (higher pressure?) water bearing layer which could intersect the perforated section anywhere. Presumably they have already identified a possible culprit in the lower part of the perforations and are just confirming with the further logging, but they had pretty comprehensive logging in open hole.

With the Kimmeridge being fractured is there an issue with the fractures acting as miriad conduits from the water zone
to the well bore and bypassing the bridge plug?

As for Broadford Bridge I've never seen it definitively stated that a cement squeeze was performed, UKOG said they were going to, and then said in later releases it wasn't necessary - but not whether that was determined in time to stop it being done.

It's a matter of opinion whether directors should exercise options and/or buy shares in the company they 'direct' or not.

But SS has had plenty of opportunity to do either, in fact from the 16 April 2018 RNS:-

'The independent directors determined that to ensure the continued alignment of the interests of shareholders and the option holders and considering the liquidity of the Company's shares it would be beneficial to extend these options rather than allow their exercise in the current open period and consider the grant of further options to both the CEO and COO.'

So they must have said we're not buying now (despite being about 1.5p), during an open period, and got them extended for an extra year, and the excuses given - are they really genuine - if they actually had shares they'd paid for and kept wouldn't they be even more aligned?

Was is really just that the SP wasn't high enough (so much for alignment during the time they had the options up to then) and it might be higher during an open period during the next 20 months.

They certainly weren't worried about liquidity when they do placings after placings..

basil,

WH Ireland didn't lend anything to UKOG, they acted as an agent to sell the shares.

From the RNS;-

'WH Ireland agreed to arrange the Placing.'

'The Placing has not been underwritten by WH Ireland.'

In fact they would have received a fee for doing this:-

'WH Ireland is granted standard placing commissions and broker warrant over ordinary shares.'

Brocal,

don't believe that the red/blue is always an accurate description of whether a trade is a buy or sell - it's just whether the trade was above or below the mid price.

During most of the day (certainly after 9:09am) when the published spread was 1.1p to 1.15p, trades above 1.14p were probably buys and below 1.139 sells.

Anyway, applying that definition of buy/sell the balance of buys to sells is much closer than the unsustainable recorded 30+million buys to 6+million sells.

TollesburyStu,

It may well be good news but If you insist,

Well read my earlier post...…this bit.....

'As for the subjective opinion that the gas rate has increased - that may not be a good sign - whilst increased gas could mean increased oil production it could also indicate the pressure is decreasing within the reservoir allowing gas to come out of solution reducing oil production.'

So could be struggling to keep the oil rate up if more gas is being produced - but then again could be increasing oil production, but that's not what they said they'd do (RNS 15th March):-

The continuous Portland dry oil flow (i.e. oil with zero water content), at a stable daily average rate of over 220 barrels per day ("bopd"), forms a key part of the schedule of works required to finalise the Portland field development plan and to the targeted establishment of permanent long-term Portland production by end 2019.

As I also said they don't always do what they say they will.

Zoom,

I'm not going to get into a discussion about something you think is normal unless you can actually quote where this idea comes from, but a well is made safe by 'killing' it which is done by introducing fluid of high enough specific gravity in the well to make the bottom hole pressure higher than the reservoir which stops the well flowing.

and yes they are intending to return to the Kimmeridge, just not now: 'Resumption of continuous Kimmeridge test production is now planned to follow directly after the drilling of HH-2.'

As there are no perforations and there is no completion across the KL1 and KL2 they would require a pretty obvious workover to test these.