Magellan Petroleum, the American company with an interest in the Horse Hill well near Gatwick, has commented on the announcement about huge quantities of oil in the Weald made by its partner UK Oil & Gas Investments.
In a press release issued this morning, Magellan said it was encouraged by the results of analysis of the Horse Hill well but added that more work was needed before it could “form an opinion on the prospect’s economics”.
Last week, UKOG said there could be 158m barrels of oil per square mile under the Gatwick area, based on a report by its analyst, Nutech. Chief executive Stephen Sanderson told the BBC there could be 50bn-100bn barrels of oil in the Weald as a whole. Our report
But on Wednesday this week, UKOG issued a clarification, admitting it had not done work outside its licence areas to comment on the oil in place in the Weald Basin. It added that the volumes it had estimated “should not be considered as either contingent or prospective resources or reserves.”
Yesterday, a full-page article in The Times asked whether UKOG chairman, David Lenigas, was “a Wild West hero or just a gunslinger who shoots from the lip?”
This morning, Magellan’s President and CEO, J Thomas Wilson, said: “We have been encouraged by the technical analysis performed on the Horse Hill prospect by UKOG and its partners. The oil and gas potential of the Weald Basin has been strengthened.
“However, Magellan believes that further testing of the HH-1 well is needed before we can form an opinion on the prospect’s economics. We remain bullish on the petroleum potential of central Weald Basin.”
Magellan also confirmed it had sold its 40% stake in PEDL 126, which covers the West Sussex/Hampshire border and includes the Markwells Wood-1 well. The sale, for a “nominal consideration”, clears a $0.4m liability from Magellan’s balance sheet for site restoration at Markwells Wood, the company said.