Member Info for Penguins

Gerry, As I've said previously the OGA currently requires proof of financial capability the relevant document is here:- https://www.google.com/url?sa=t&source=web&rct=j&url=https://www.ogauthority.co.uk/media/1399/financialguidancev3.pdf&ved=2ahUKEwiyoNDA5cbbAhWKJsAKHdl1Do8QFjAAegQICBAB&usg=AOvVaw2kHYHMV44o5cAbOcQZ8ObX Otherwise search on oga financial capability worked for me. OGA won't be testing vs any proposed not finalised regs but those currently in force. Enjoy

I sometimes think that there is a belief that UKOG are the operator of HH. HHDL are the operator of HH. UKOG is a shareholder in HHDL, and they do not even have a controlling interest in HHDL, they are not a partner in the licence. The only interest OGA will have in any of the shareholders is whether the shareholders will stump up the cash for HHDL to complete any committed work programme. BTW The OGA do check that funding is available for committed work programme. The licence extension was on the basis of certain additional work, UKOG only have to fund 32% of work beyond the ewts. Production tests on the Kimmeridge and Portland formations of the Horse Hill-1 well Drilling a side-track HH-1z into the Kimmeridge Limestone Horse Hill-2 (HH-2) Portland appraisal well 50km2 of 3D seismic surveying 25km of 2D seismic survey Additional exploration well in PEDL246

The relevant paragraph is as Matteth posted: The Company is currently considering whether to seek to change its current investing company status via a re-admission to AIM as an operating company. Consequently, the CPR was compiled as part of the necessary preparations for such an event." As they say they are considering I would assume it isn't actually legally necessary but for other reasons it may be useful.

I'm sure the reason they requested it is as stated. Not sure of the AIM rules but most companies seem to publish CPRS as soon as they are received so timing arbitrary. Though could be something to wave in front of the money men - so perhaps should this rumour be true the timing of raising more funds was driven by when this CPR was released rather than the other way round. Not sure that the previous IOW and HH Portland assessments were classed as a CPR so seems this allows a re-issue with modifications (haven't actually compared them, but the figures were the same) to bring those more substantial reports up to CPR plus tidied up al the other asset volumetrics.

The operator of the BB licence is Kimmeridge Oil & Gas Ltd. It already has operator status with he OGA having drilled BB-1. The Operator of the HH licence is HHDL and already has operator status with the OGA, having drilled HH-1. As far as HH is concerned the status of UKOG as an investment company is actually the situation. But UKOG will have to have proportionally funded HHDL (the same for the other shareholders in HHDL) prior to the well test so that HHDL could demonstrate funds to perform the work anticipated during the well test, for the more distant, conditional work (HH-2, HH -1 sidetrack) maybe a BOD letter confirming funds will be available if required. As KOGL has recently taken on 2 well commitments to retain the whole BB licence UKOG will probably have had to provide assurancies (BOD letter to KOGL) that funds were available for this work, and perhaps shown funds or promised funds in their account by a given date. So even if UKOG has funds for the programmed work in 2018 they may have to demonstrate funds for the work in 2019. I would expect a statement from the company PDQ if this news is fantasy as it seems to be affecting the SP. As for the CPR, Xodus was not provide with sufficient information by UKOG to assess the methodology adopted by Nutech in calculating their OIP figures, so,they couldn't apply even a analogue recovery factor to,achieve the lowest grade resource estimate (Prospective Resources).

Apart from the jam tomorrow words the actual substance of this RNS, numbers in a CPR, appear little different from any previously given. Main difference I can see is no Avington, no Lidsey, no Brockham so previous 2P reserves, the ones that mean anything, have gone down from 91,000 bbls to 85,000 Previous unrisked net resources (contingent and prospective, best estimate and P50) were 21.64 mmbbls, now 21 mmbls. As for moving a significant amount of resources to reserves that will depend mainly on further drilling on the IOW as the P50 net HH contingent resource in the Portland is about half a million bbls So nothing to see here except promises for the future. It's a pity they didn't point out that most of these figures were already published., did Xodus just review the operators CPRs and repeat their own previous numbers for IOW and HH? I know the gamble is whether the KL will be commercial, but even following a successful test at HH converting anything that is not reserves into reserves for the Kimmeridge will involve a lot of drilling. Someone with more knowledge of what the restrictions are regarding investment companies as for example the operating at BB is actually preformed by a subsidiary of UKOG (KOGL), or in the case of HH by HHDL in which UKOG (and others) has invested.

I see Free is busy on Twitter. He is convinced that there was 'secret' flowing. To save you looking he said (from Twitter):- 'The fool on the hill ‏ @Adrianwfire I got slated for saying this as wellin in LSE a while back. Well. Itds not just me saying it . Good read. Don't believe Pingos BS on LSE each layer was tested uptown 90 hours' Actually the tests lasted according UKOG for 30 to 90 hours (RNS 23 March): 'Over the 30-90 hour flow periods from each of the 3 zones' The enthusiasts think that some 'secret' testing and flow initiation took place as the 'flow' periods weren't 30 to 90 hours. My take is that UKOG are including the post test PBU in the quoted flow (test) period, at least for the KL4, if not it just took longer to initiate. The length of the KL layer tests can be approximated from the RNS. KL3 started 10am on 15th Feb. and finished at 17:15 on 16th February (with a pressure build up during that time (PBU), with probably a PBU after that (not mentioned) - but just these times equal 31.15 hours. KL4 flow started at 13:50 29th February and shut in 1st March at 6 am (with a PBU during that time) for a 12 hour PBU a total of 28 hours - but as the first test was initiated by pump we don't know how long that took prior to the oil reaching surface. The Portland started flowing 8th or 9th March (not specified but RNS'd 9th March, and the last test was mentioned in the 23rd March RNS but the total flow periods and PBU is not released but could easily be 90 hours. The main reason the enthusiasts were promoting the idea that there were long periods prior to the flow tests at HH was to support their ramping of the BB testing (the completion fluid production was what happened at HH during the unmentioned test period). It's strange that what happened next (no oil) was different to HH. Anyway legalese (and Free) you didn't mention that even 'sharetalk' only quoted 5000 to 8000 bopd (from a Kimmeridge well) and their take of it was:- 'Another analysis, perhaps to be taken with a few grains of salt, from Dowgate the brokers for Alba Oil, one of the smaller shareholders.' The dumb thing is that one horizontal well can't penetrate these 3 layers, but their 3 to 5 times is of the aggregate flow from 3 layers (including Portland). Turnashilling: The volume of oil removed will be over a wide area, is relatively small and removed slowly and post production will be refilled over a (fairly long) time period. It may be that the closing of the fractures (if happening) is driven by the pressure within the rock matrix anyway - no net loss of GRV. It will also depend on the orientation of the fractures. The overburden will easily accommodate any shrinkage if there is any, no sinkholes or earthquakes. Anyway the original BB hole was unable to be cased because the casing got stuck on a 'ledge'. The Kimmeridge is not fragile, in fact this proves it isn't. Sorry another long one.

I keep seeing this figure of 1688 bopd quoted, I suppose it gives comfort to the poorly researched. But that's an aggregate of the 3 highest separate short tests at HH on each of the three producing layers including Portland. I'll concentrate on the Kimmeridge as that is the regional play, the Portland tested on pump at 168bopd, then 323bopd and will be tested using a 450 bopd pump in the upcoming ewt as both previous tests were constrained by the pump. However both the KL3 and KL4 tests had lower rates on their second test than the first. If these second tests were taken rather than the first then after flowing for a few hours (see test details below) of each being tested the aggregate rate of the KL3 and KL4 dropped from 1363 bopd to 1294 bopd. What might be the rate after 30 days of testing? That's what the ewt is for, but it seems unlikely to be anything like the tests already performed. The details (or facts) from these four test RNS are: RNS 16 Feb: KL3 First test about 7.5 hours, stable rate 463 bopd choke 32/64 choke. RNS 17 Feb: KL3 Second test about 9.5 hours, stable rate 456 bopd, 28/64 choke (reduced to stabilise flow) RNS 01 Mar: KL4 First test about 4 hours, stable rate excess of 900bopd, 1 inch choke. RNS 02 Mar: KL4 Second test about 7.5 hours, average rate of 838 bopd, 1 inch choke (didn't stabilise). What Neil Ritson said about the KL layers at the UK Investor Show 2018 (he is Executive Chairman of Solo Oil, 10% owner of HHDL) might be more useful than the often repeated by UKOG (and others) 1688 bopd which is not the only 'fact' about the HH testing':- 'Now these are fractured reservoirs and they will have been offloading the oil from the fractures. What we are going back in this year to establish is if you leave them open for a period of time what is the sustainable rate, which you would expect to be down in the 100 to 200 barrels per day range if it's going to be commercial.' So possibly ('expect to be') commercial and probably improvable with a horizontal well, but nobody knows what a stable production rate might be for HH-1 (which is deviated at about 40 degrees through the Kimmeridge) until the ewt and subsequent analysis, hopefully in a CPR with the improvement possible with a horizontal well, is published. One further point is one of the possible reasons for BB failure was the possibility that the fractures were closing up (Annual Report & Accounts): 'As to whether these fractures remained fully or partly open during the necessary pressure draw-downs following acidisation used during testing is currently under investigation.' So was the oil flow at HH sustained during the 2016 short tests by the fractures closing up which could explain the maintenance of pressure mentioned (RNS 21 Mar 2016):- 'no clear indication of any reservoir pressure depletion was observed' Over to UKOG....................anybody there?

Last week we were told by the eyes n the site they were installing an esp in X1. Now if they are perforating something, in X1 (?), it wouldn't be logical to install an esp then uninstall it to perforate unless there was a problem. It's also unlikely they are perforating the Kimmeridge in X2 as this well has the higher production in the Oolite and as has been pointed out there is a slotted liner in the Oolite, so no need for that level. Perhaps this is just working over and perforating a different section in X1, or re-perforating for some reason. In the CPR (in the admission document) there seems uncertainty as to where X1 was originally perforated and there was another go at perforating in 2008:- 'The perforations depths of Lidsey-X1 are not entirely clear. Original perforations are from 3300 to 3320m Rotary Kelly Bushing (�RKB�) (3265 � 3285 ft MSL), in the interbedded Oolite. But in the Lidsey-X1 �Final Well History�, RKB 35 ft MSL, and RKB 12 feet above ground level are mentioned.' and in 2008..... 'two sets of perforations were added at intervals 3282 to 3305 ft RKB and 3353 to 3378 ft RKB. However, the added perforations did not significantly change production.' They also state, though this is probably not what they are up to. When production from Lidsey-2 starts, it is expected that Lidsey-X1 will be turned into a water injection well. But until Angus clarify what they are up to it's all guesswork - including this, though following the SP action you would hope Angus would make a statement if it's on a false premise.

Did anyone actually read the statement - including Free? I didn't notice a single reference to shale oil, just shale gas. Anyway what is being tested at HH, and likely to be produced from if that's successful, are tight naturally fractured limestone / micrite intervals.

Wizard, You stated 15% recoverable as if that's what has been quoted as a normal figure. Yet Nutech actually state in the 21/10/2015 OIP Executive Summary:- These US analogues have estimated recovery factors of between 3% and8% and in a few cases up to 15% of contacted Oil in Place per well.. These recovery factors are achieved with the use of well stimulation techniques.' So on top of all the disclaimers about OIP not implying any recoverable oil (which I haven't copied) the figure of 15% is only 'in a few cases'; is of contacted oil per well - which we have no indication of until the ewt is completed; and is with the use of what they have coyly termed stimulation techniques, ie fracking. Perhaps that's why 15% recovery wasn't mentioned.

I can't imagine that the delay (is there one?) is due to the OGA. HHDL will be well aware of the requirements both technical and financial and will have discussed with the OGA prior to submission. I'm not sure about equipment. Poster vilk (n Alba and Solo and tweeted by the usual suspects) seems to have had a conversation with a CEO of one of the companies where he was told a crane would be used - but perhaps that was during the testing, not the initial well preparation. We will see, but I would have thought a crane would not have been difficult to source, but maybe ancillary equipment is required that is rarer. Neil Ritson certainly didn't mention it in his presentation at the UK Investor Show 2018. What he did say about HH was interesting though. Just after 10 minutes in '......Horse Hill......this was the Gatwick gusher, overhyped at the time of its drilling but nevertheless a very successful well, it delivered a Portland conventional sandstone reservoir with production of over 300 barrels per day on pump, that's a very attractive rate for an initial production well in the UK, and then these 2 deeper limestones which were not expected, and not expected to produce well, producing 500 and 900 barrels per day on short term test. Now these are fractured reservoirs and they will have been offloading the oil from the fractures. What we are going back in this year to establish is if you leave them open for a period of time what is the sustainable rate, which you would expect to be down in he 100 to 200 barrels per day range if it's going to be commercial. It's not a vertical well and not a horizontal well either so not necessarily optimised for production of those fractured reservoirs. They are shallower than the fracking limit so nobody will be fracking this and we have all the planning permission........' NR is a geologist / geophysicist and seems to be more realistic in his analysis of the possible outcomes of the testing, as an owner of HHDL Solo will have access to all the reports and data from HH-1 so why don't UKOG give any guidance. Obviously if HH achieves a stable 200 bopd flow rate the uplift possible from a horizontal well HH will be very economic - but predictions of 8 or 9000 bopd from a horizontal well are just fantasy. It's a pity that UKOG don't offer a more balanced view rather than keep repeating the 1688 bopd mantra which would appear to be misleading, and then becomes the starting point for some posters calculation of future production. Such predictions can only lead to disappointment if NR is correct.

Pboo, Really. UKOG didn't actually know what the problem was. Even after BB was finished they were still uncertain guessing it might have been the fractures closing up during the pressure drawdown following acidisation. During the testing after each failed test at BB, as the expectation following the coring and logging seemed to be that the well would flow commercial volumes (remember the 'production' completion many posters were crowing about), a different excuse was offered, too much shale (KL1), not enough permeability (Lower KL3) more time to clean up flow needed (KL5, but eventually they gave up and returned to the KL1). So drilling another sidetrack, having already drilled one already for valid reasons, may not have been an option, but drilling when what was needed to ameliorate the problem wasn't known could have delivered yet another duff (but apparently successful) well. Of course there may be a solution, but sometimes OIP won't flow. Is it a pressure problem, is HH unique? So far it seems to be, we await Brockham, Balcombe, Holmwood and possibly Lidsey. Incidentally, the original well did not collapse, from the annual report and accounts:- 'Caliper log data clarly showed that the well maintained an aceptable degree of rugosity with absolutely no evidence of any collapse' The casing got stuck on a ledge.

Interesting as 38.5 million shares might be the amount of shares that YA might get for a 500,000 conversion.