Industry

UK Oil & Gas raises £4m for Weald operations

Horse Hill 160202

The workover rig at Horse Hill

UK Oil & Gas Investments, one of the companies with interests in the Horse Hill exploratory oil well near Gatwick, has announced it is to invest an extra £4m in the Weald basin in southern England.

In a statement issued yesterday, UKOG said the money was raised from the sale of ordinary shares. The company said the money would be used to further its existing Weald Basin portfolio activities and for potential investment in new onshore oil and gas activities in southern England.

Stephen Sanderson2Last week, UKOG’s chief executive, Stephen Sanderson, gave details of the company’s plans in the Weald, which he had said had the support of government.

Speaking at the Shale World UK conference, he described a two-year plan for the Horse Hill well designed to establish whether it was commercial. He also said the company would be involved in other wells across the Weald Basin.

He said:

“We have spoken to 10 Downing Street. They are quite supportive. The thing they like about this most of all is not just the fact that it provides indigenous hydrocarbon to give you ultimate energy security … but what they’re really interested in, I suppose, is the revenue to their Treasury.”

Horse Hill

In February, UKOG tested the flow of oil from Kimmeridge and Upper Portland rock sections of the Horse Hill well. It described the results as “outstanding” and at rates equivalent to the North Sea.

Planning permission has now expired at Horse Hill. But the company is planning production tests, each of 90 days.

Mr Sanderson said:

“We plan to go in and do these long-term tests hopefully in the winter of this year. If that’s successful, we’ll immediately go in and drill a horizontal production well in one of the Kimmeridge limestones. We’ll be shooting 3D seismic so that we’re able to plan to drill more and locate more horizontal wells.”

Weald Basin plans

UKOG has predicted that by 2030 oil from Kimmeridge limestones in the Weald could meet a quarter of UK  demand.

Mr Sanderson said the company would be involved in up to four other wells across the Weald basin. This work would, he said, show “that you can extrapolate the findings from Horse Hill over the basin and actually prove conclusively that the deposit does extend over 1,200-1,500 square miles.”

Looking ahead

Mr Sanderson said he envisaged between 20 and 100 well sites across the Weald, each of 4-6 acres. He said:

“Because of the ubiquitous nature of this type of deposit you can actually cherry pick for development sites in places that are less environmentally sensitive, such as brownfield sites and there are quite a number over the Weald that we could utilise.

“You could also site it away from villages and small roads. So you can minimise the actually day to day impact on the area.”

In two years’ time, he predicted:

“If everything goes well, we should be in the position where this new play Kimmeridge limestone oil is ready to go into the development stage and contribute quite significantly both to the local economy and to the national economy and of course to UK Oil & Gas.”

UKOG interests

UKOG has interests in 11 exploration licences in southern England. They include four oil fields in production and three oil fields awaiting development or appraisal.

The assets range from a 100% interest in Markwells Wood (PEDL126) to 4.2% in the Lidsey oilfield (PL241), both in West Sussex.

UKOG assets

Source: UK Oil & Gas Investments Ltd

1 reply »

  1. Probably just enough cash to pay for the Directors’ remuneration package: salaries, pension contributions, expenses, slush funds, etc.

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