Last checked at 2 Feb 2024 14:08
UK Oil & Gas PLC
("UKOG" or the "Company")
Pinarova-1 Testing Operations Update
UK Oil & Gas plc (London AIM: UKOG) announces that, following successful reperforating and extensive swab testing at Pinarova-1 by operator Aladdin Middle East, we have mutually concluded that, in the absence of commercial rates of hydrocarbons, no further testing will take place.
Given the prior recovery of mobile light 42° API oil from the mud pit (RNS of 22nd September 2023), oil shows, strong oil odours at surface over a 12-hour drilling period and the associated shot-hole oil seep with geochemically identical oil, we are disappointed that Pinarova-1 has not met our joint expectations.
However, we believe that the drilling and testing results indicate Pinarova likely penetrated the southernmost feather edge of a small oil accumulation within the Germik/Hoya sequence, stretching updip towards Kezer-1. Preliminary analysis of all data indicates that the source of these shallow light oils is most likely from spill or seepage from an underlying deeper light oil pool in the Kezer-Pinarova area. We will continue to investigate the commercial potential of both these future targets.
The testing operations involved successfully detonating 7-inch perforating guns at 12 shots per foot over a 40 ft section of Germik/Hoya sequence, a comprehensive injectivity and swab testing programme, followed by an acidisation operation and further swab testing.
Results confirmed full communication with the reservoir via the new 7-inch perforations, justifying the Company's interpretation that the original 4.5-inch guns did not fully access the Hoya/Germik reservoir. Costs for the operations were kept to a minimum throughout.
The larger guns, supplied by PSI, were used following normal site rig up and necessary safety and environmental checks. UKOG's own site representative was on hand to monitor quality control and safe operations.
UKOG holds a 50% non-operated interest in Pinarova-1 and the surrounding 305 km² Resan licence.
Chief Executive Stephen Sanderson commented:
"Exploration drilling and testing is never guaranteed to deliver success, even if all prior indicators are positive. This is certainly the case for Pinarova-1, and we are disappointed by the lack of commercial flow. We will continue to analyse all data and explore both the potential updip shallow Germik/Hoya accumulation and the likely more significant deeper pool objective, the most probable source of the observed shallow hydrocarbons and shot-hole oil seep. With operator Aladdin's cooperation, costs were fortunately kept to a minimum and it adds to our bank of data about the Resan licence for the future."
Qualified Person's Statement
Matt Cartwright, UKOG's Commercial Director, who has 40 years of relevant experience in the global petroleum 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 / Allen D Howard Tel: 01483 941493
WH Ireland Ltd (Nominated Adviser and Broker)
James Joyce / James Bavister / Andrew de Andrade Tel: 020 7220 1666
Communications
Brian Alexander Tel: 01483 941493
Glossary
°API | a measure of the density of crude oil, as defined by the American Petroleum Institute |
oil seep | a natural flow of crude oil at or close to the earth's surface whose origin is from a petroleum accumulation or oil source rock at depth. |
shot-hole | a shallow borehole in which a small amount of explosive is detonated in order to generate a seismic signal |
The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The information is disclosed in accordance with the Company's obligations under Article 17 of the UK MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain.