Last checked at 23 Mar 2021 07:00
UK Oil & Gas PLC
("UKOG" or the "Company")
Turkey Basur-3 drilling site construction commences
UK Oil & Gas PLC (London AIM: UKOG) is delighted to announce that construction of the Basur-3 appraisal well's drilling pad and access road has now commenced. Construction works, located within the Company's 50% owned 305 km² Resan licence, are scheduled to last approximately 60 days.
The Basur-3 location lies approximately 1.2 km north and geologically updip from the 1964 Basur-1 oil discovery well, which as detailed in the Company's 14 October 2020 and 15 January 2021 releases, produced 500 barrels ("bbl") of oil from a short 6-hour swab test, equivalent to an extrapolated daily rate of 2,000 bbl of oil per day.
Basur-3, the first modern appraisal well designed to confirm the extent and commerciality of the discovered Basur-Resan Mardin oil pool, will test the north western structural culmination of the 45 km² Basur-Resan geological structure.
As per the Company's 15 January 2021 release, Basur-Resan's Mardin oil pool is estimated to contain aggregate gross mean and high case discovered recoverable resources (see glossary below) of 37.2 million barrels ("mmbbl") and 67 mmbbl respectively. UKOG's corresponding 50% net share being 18.6 mmbbl (mean case) and 33.6 mmbbl (high case).
The board continues to view the forthcoming Basur-3 and subsequent Resan-6 appraisal drilling programme to present a compelling and potentially transformational growth opportunity for the Company.
A Basur-3 presentation, including site photographs, is available on the Company's website:
https://www.ukogplc.com
Stephen Sanderson UKOG's Chief Executive commented:
"The breaking of ground at the new Basur-3 drilling site makes this material appraisal project very real and tangible. The speed of entry into the operational phase, barely two months after government ratification of our entry into Turkey and despite pandemic constraints, nicely demonstrates the ability to move projects forwards at pace in Turkey, a welcome change from the UK. We salute our highly experienced partner Aladdin Middle East's efforts in this respect and look forward to drilling and testing once the site is completed."
Qualified Person's Statement
Matt Cartwright, UKOG's Commercial Director, who has 37 years of relevant experience in the global oil industry, has approved the information contained in this announcement. Mr Cartwright is a Chartered Engineer and member of the Society of Petroleum Engineers.
For further information, please contact:
UK Oil & Gas PLC |
|
Stephen Sanderson / Kiran Morzaria
| Tel: 01483 941493 |
WH Ireland Ltd (Nominated Adviser and Broker) |
|
James Joyce / James Sinclair-Ford
| Tel: 020 7220 1666 |
Communications |
|
Brian Alexander | Tel: 01483 941493 |
|
|
|
|
Glossary
discovered recoverable volumes/resources (or contingent resources) | those quantities of discovered petroleum estimated, as of a given date, to be recoverable from a known accumulation, but where the project is not yet considered proven for commercial development due to one or more contingencies. In the case of Basur-Resan the contingency being confirmation that a well can recover a commercial volume at commercially viable rates, a normal appraisal stage uncertainty. Discovered resources are further categorised in accordance with the level of certainty associated with the estimates and may be sub-classified based on project maturity and/or characterised by their economic status. Should the appraisal programme confirm commerciality, it is expected that resources would convert into reserves (see reserves definition below) |
discovery | petroleum accumulation for which one or several exploratory wells have established through testing, sampling and/or logging the existence of a significant quantity of potentially moveable hydrocarbons |
gross | 100% share |
high case | or P10 volume, where there is a 10% probability respectively, that the stated volume will be equalled or exceeded |
mean | the expected or average outcome of a defined probability distribution, in this case the calculated distribution of recoverable volumes |
net | UKOG's 50% Resan licence interest share |
reserves | those quantities of petroleum anticipated to be commercially recoverable by application of development projects to known accumulations from a given date forward under defined conditions. Reserves must further satisfy four criteria: they must be discovered, recoverable, commercial, and remaining (as of the evaluation date) based on the development project(s) applied. Reserves are further categorised in accordance with the level of certainty associated with the estimates (i.e., Proven, Probable and Possible) and may be sub-classified based on project maturity and/or characterised by development and production status |
UKOG Licence Interests
The Company has interests in the following UK and international licences:
Asset | Licence | UKOG Interest | Licence Holder | Operator | Area (km2) | Status |
Horndean 1 | PL211 | 10% | UKOG (GB) Limited | IGas Energy Plc | 27.3 | Field in stable production |
Horse Hill ¹, ⁵ | PEDL137 | 85.635% | Horse Hill Developments Ltd ⁶ | Horse Hill Developments Ltd ⁶ | 99.3 | Field in stable production |
Horse Hill ¹, ⁵ | PEDL246 | 85.635% | Horse Hill Developments Ltd ⁶ | Horse Hill Developments Ltd ⁶ | 43.6 | Field in stable production |
Avington 1 | PEDL070 | 5% | UKOG (GB) Limited | IGas Energy Plc | 18.3 | Field temporarily shut in |
Resan Turkey 2, 3, 8 | M-47-b1, b2 | 50% | UKOG Turkey Ltd | Aladdin Middle East | 305 | Appraisal of Basur-Resan oil discovery plus further expl. prospects. Drilling planned in 2021 |
Loxley 2, 3, 7 | PEDL234 | 100% | UKOG (234) Ltd 4 | UKOG (234) Ltd 4 | 300 | Loxley/Godley Bridge gas discovery, BB-1/1z oil discovery |
Isle of Wight 2, 3 | PEDL331 | 95% | UKOG | UKOG | 200 | Planning application submitted for Arreton oil appraisal well |
Notes:
1. Oil field currently in stable production.
2. Oil discovery pending development and/or appraisal drilling.
3. Exploration asset with drillable prospects and leads.
4. Contains the Loxley Portland gas accumulation, the Broadford Bridge-1/1z Kimmeridge oil discovery, plus further undrilled Kimmeridge exploration prospects.
5. Portland and Kimmeridge oil field with productive and commercially viable zones, HH-1 in stable oil production, production planning consent granted in September 2019, long-term production consent granted in March 2020.
6. UKOG has a direct 77.9% interest in HHDL, which has a 65% interest in PEDL137 and PEDL246.
7. Gas discovery pending appraisal drilling and development with underlying Kimmeridge potential
8. High-impact oil appraisal project with an upside OIP range of 150-500 mmbbl gross with expected recovery factors of 10-20% of OIP
The information contained within this announcement is deemed by the Company to constitute inside information under the Market Abuse Regulation (EU) No. 596/2014