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17 Oct 2016 07:00
17 October 2016
UK Oil & Gas Investments PLC
("UKOG" or the "Company")
Horse Hill-1 Oil Discovery, Weald Basin, UK
Planning Application for Significant Appraisal Programme, UK Weald Basin
UK Oil & Gas Investments PLC (LSE AIM/ISDX: UKOG) announces that Horse Hill Developments Ltd ("HHDL") has informed the Company that a planning application has been submitted to Surrey County Council seeking permission to conduct further significant appraisal testing and drilling at the Horse Hill-1 ("HH-1") oil discovery, located in Licence PEDL137, close to Gatwick Airport. The HH-1 oil discovery achieved an aggregate stabilised flow rate of 1688 bopd from two Kimmeridge limestones plus the overlying Portland sandstone. The Company holds a 31.2% interest in PEDL137.
Subject to the required regulatory approvals, the first phase of the proposed development is planned to consist of the extended production testing of four zones, designed to confirm the commerciality of the discovery, and to examine a previously untested Kimmeridge limestone. The planning application also seeks permission for a two-well drilling phase, which contingent upon successful testing, will further appraise the extent of the oil accumulations and the field's production capabilities. The proposed drilling phase includes plans for a deviated sidetrack, HH-1z, to be drilled from the existing HH-1 borehole, together with a new well, Horse Hill-2 ("HH-2"). On completion of drilling, both the HH-1z and HH-2 are planned to be long-term production tested.
In order to minimise impact to the locality, feedback from both a public consultation and engagement process, undertaken in July, and subsequent meetings with local residents' representatives, was incorporated into the envisaged development design and planning application. The normal local planning authority cycle for an application not requiring an Environmental Impact Assessment such as at Horse Hill, takes approximately 13 weeks.
HHDL and the Company's Interest in the Licence
HHDL is a special purpose vehicle, which owns a 65% working interest and operatorship of the Licence. UKOG now owns a 48% beneficial shareholding in HHDL, which equates to a 31.2% net working interest in the Licences. The remaining 35% interest in the Licences is held by Magellan Petroleum (UK) Limited.
Stephen Sanderson, UKOG's Executive Chairman, commented:
"This planning application, together with our recent Markwells Wood appraisal and development planning application, is firmly designed to move these assets into near term oil production and the monetisation of our core recoverable resources. It is also one of the next key steps in furthering our industry leading knowledge of the Kimmeridge limestone play that lies beneath our extensive acreage holding in the Weald. We look forward to further engaging with stakeholders and to a successful planning outcome."
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 / James Bavister Tel: 020 7220 1666
Square 1 Consulting (Public Relations)
David Bick / Brian Alexander Tel: 020 7929 5599
Glossary:
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 |
extended production test | a flow test, or extended well test, as per the permission granted by the Oil and Gas Authority, with an aggregate flow period duration over all zones of greater than 96 hours and up to 90 days maximum |
sidetrack | re-entry of a well from the well's surface location with drilling equipment for the purpose of deviating from the existing well bore to achieve production or well data from an alternative zone or bottom hole location, or to remedy an engineering problem encountered in the existing well bore. |
Notes to Editors:
UKOG Licence Interests
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. Licence extended to 2018 |
Broadford Bridge 3 | PEDL234 | 100% | Kimmeridge Oil & Gas Limited 4 | Kimmeridge Oil & Gas Limited 4 | 300.0 | BB-1 well permitted, expected 2017 spud date. |
Brockham 1 | PL235 | 3.3% | Angus Energy 6 | Angus Energy 6 | 8.9 | EA permission requested for drilling of B-4x sidetrack |
Holmwood 3 | PEDL143 | 30% | UKOG | Europa Oil & Gas (Holdings) plc | 91.8 | Holmwood-1 exploration well spud expected 2017 |
Horndean 1 | PL211 | 10% | UKOG (GB) Limited | IGas Energy Plc | 27.3 | Field in stable production. |
Horse Hill 5 | PEDL137 | 31.2% | Horse Hill Developments Ltd 7 | Horse Hill Developments Ltd 7 | 99.3 | Submitted planning application for long term production tests and 2 wells |
Horse Hill 5 | PEDL246 | 31.2% | Horse Hill Developments Ltd 7 | Horse Hill Developments Ltd 7 | 43.6 | As above |
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 6 | Angus Energy 6 | 5.3 | Drilling of infill well being considered |
Markwells Wood 2 | PEDL126 | 100% | UKOG (GB) Limited | UKOG (GB) Limited | 11.2 | Submitted planning application for appraisal and field development |
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. UKOG has a 100% interest in Kimmeridge Oil & Gas Limited, which has a 100% interest in PEDL234.
5. Oil discovery with recently completed flow testing.
6. UKOG has a 6% interest in Angus Energy, which has a 70% interest in Lidsey and a 55% interest in Brockham.
7. UKOG has a direct 48% interest in HHDL, which has a 65% interest in PEDL137 and PEDL246.
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