Last checked at 5 Jul 2016 07:00
UK Oil & Gas Investments PLC
("UKOG" or the "Company")
Key Licence Extensions, Kimmeridge and Portland Region, Weald Basin
UK Oil & Gas Investments PLC (LSE AIM: UKOG) is pleased to announce that the Oil and Gas Authority ("OGA") has granted two licence extensions, and three licence conversions to new model terms for the following licences in which the Company has material interests:
· Horse Hill ("HH") PEDL137 and PEDL246 (Company Interest 27.3%): At the election of the Operator, Horse Hill Developments Ltd, the licences will adopt the 2016 14th Round licence terms, permitting the HH Licences to continue without further relinquishment. A Retention Area ("RA") covering the entire 55 square mile licence area and an outline work programme has been agreed with the OGA. The RA will continue throughout the agreed work programme period currently due to expire on June 30, 2018 for PEDL137 and June 30, 2017 for PEDL246. The HH Licences forward work plan includes long-term production testing of 3 Kimmeridge Limestone zones plus the overlying Portland, two contingent appraisal/development wells and 3D seismic.
· Broadford Bridge ("BB") PEDL234 (Company interest 100% via ownership of Kimmeridge Oil and Gas Ltd): A two-year extension of the Initial Term of the licence to June 30th 2018. The Licence contains a constructed well pad and regulatory permissions to drill the BB-1 Kimmeridge Limestone well, a look-alike Kimmeridge prospect to the Horse Hill-1 Kimmeridge Limestone oil discovery. The licence also contains the mapped eastern extension of the Godley Bridge Portland gas discovery with excellent underlying Kimmeridge potential which will be tested by a new appraisal well subject to obtaining necessary regulatory consents.
· Markwells Wood PEDL126 (Company Interest 100%): The licence will now adopt the new 2016 14th Round licence terms permitting the Licence to continue without further relinquishment. The RA will continue throughout the agreed work programme period currently set to expire on June 30, 2017. The Licence's forward work programme includes obtaining planning permission for a phased oil development and the submission of a Field Development Plan.
· Baxters Copse PEDL 233 (Company Interest 50%): A two-year extension of the Initial Term of the licence to June 30th 2018. The Licence contains the Baxters Copse-1 ("BC-1") Jurassic Oolite oil discovery. The extension will permit an oolite appraisal well and possible Kimmeridge limestone test to be drilled subject to obtaining necessary regulatory consents.
Stephen Sanderson, UKOG's Executive Chairman, commented:
"The conversion of the Horse Hill Licences to the new 14th round licence terms is particularly valuable to the Company. We can now move our stated Portland and Kimmeridge Limestone appraisal and development programme forward over Horse Hill in the certainty that we can retain 100% of the entire 55 square mile licence without the necessity of any future relinquishments.
Similarly, the Broadford Bridge PEDL234 extension now formally enables Kimmeridge Oil and Gas to drill the Broadford Bridge well and submit planning consents for a second well over the extension of the Godley Bridge Portland Gas discovery.
Additionally, the extension of Baxters Copse gives us further time to assess the economic viability of the BC-1 Oolite oil discovery and fully assess any Kimmeridge Limestone potential.
These extensions, plus the recently announced Holmwood PEDL143 extension, give us a clear 2-year window in which to deliver commerciality at Horse Hill and demonstrate the repeatability of the HH-1 discovery results over the basin."
Qualified Person's Statement:
Stephen Sanderson, UKOG's Executive Chairman, who has over 35 years of relevant experience in the oil industry, has approved the information contained in this announcement. Mr Sanderson is a Fellow of the Geological Society of London and is an active member of the American Association of Petroleum Geologists.
For further information, please contact:
UK Oil & Gas Investments PLC
Stephen Sanderson / Jason Berry Tel: 020 7440 0640
WH Ireland (Nominated Adviser and Broker)
James Joyce / Mark Leonard Tel: 020 7220 1666
Square 1 Consulting (Public Relations)
David Bick / Brian Alexander Tel: 020 7929 5599
.Notes to Editors:
Discovery | a discovery is a 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 |
flow test | a flow test or well test involves testing a well by flowing hydrocarbons to the surface, typically through a test separator. Key measured parameters are oil and gas flow rates, downhole pressure and surface pressure. The overall objective is to identify the well's capacity to produce hydrocarbons at a commercial flow rate |
limestone | a sedimentary rock predominantly composed of calcite (a crystalline mineral form of calcium carbonate) of organic, chemical or detrital origin. Minor amounts of dolomite, chert and clay are common in limestones. Chalk is a form of fine-grained limestone. The Kimmeridge Limestones are effectively chalks being comprised of the remains of calcareous planktonic algae |
The Company has interests in the following UK licences:
Asset | Licence | UKOG's Interest | Licence Holder | Operator | Area (km2) | Status |
Avington 1 | PEDL070 | 5% | UKOG (GB) Limited | IGas Energy Plc | 18.3 | Field in stable production. |
Baxters Copse 2 | PEDL233 | 50% | UKOG Weald Limited | IGas Energy Plc | 89.6 | Reviewing economics of appraisal/ development well. |
Broadford Bridge | PEDL234 | 100% | Kimmeridge Oil and Gas Limited | Kimmeridge Oil and Gas Limited | 300.0 | BB-1 well permitted expected 2017 spud date. |
Brockham 1 | PL235 | 3.6% | Angus Energy 5 | Angus Energy 5 | 8.9 | Drilling of sidetrack well being considered. |
Holmwood 3 | PEDL143 | 30% | UKOG | Europa Oil & Gas (Holdings) plc | 91.8 | H-1 exploration commitment well planned. |
Horndean 1 | PL211 | 10% | UKOG (GB) Limited | IGas Energy Plc | 27.3 | Field in stable production. |
Horse Hill 4 | PEDL137 | 27.3% | Horse Hill Developments Ltd 6 | Horse Hill Developments Ltd 6 | 99.3 | Extended flow testing of HH-1. |
Horse Hill 4 | PEDL246 | 27.3% | Horse Hill Developments Ltd 6 | Horse Hill Developments Ltd 6 | 43.6 | Extended flow testing of HH-1. |
Isle of Wight (Offshore) 3 | P1916 | 100% | UKOG Solent Limited | UKOG Solent Limited | 46.7 | Preparing drilling planning submission. |
Isle of Wight (Onshore) 2, 3 | PEDL331 | 65% | UKOG | TBA | 200.0 | Preparing drilling planning submission. |
Lidsey 1 | PL241 | 4.2% | Angus Energy 5 | Angus Energy 5 | 5.3 | Drilling of infill well being considered. |
Markwells Wood 2 | PEDL126 | 100% | UKOG (GB) Limited | UKOG (GB) Limited | 11.2 | Compiling Field Development Plan. |
Notes:
1. Oil field currently in production.
2. Oil discovery pending development and/or appraisal drilling.
3. Exploration asset with drillable prospects and leads.
4. Oil discovery with recently completed flow testing.
5. UKOG has a 6% interest in Angus Energy, which has a 70% interest in Lidsey and a 60% interest in Brockham.
6. UKOG has a direct 42% interest in HHDL, which has a 65% interest in PEDL137 and PEDL246.