Surrey County Council and Angus Energy are standing firm in their conflicting positions in a long-running dispute over the Brockham oil site near Dorking.
The council has repeatedly said the company did not have permission to drill a sidetrack well at the site earlier this year and needs consent to produce oil from it. Angus has consistently disagreed.
Last week, the company told shareholders the new well would go into production this summer.
Speaking during a telephone conference for investors, Managing Director, Paul Vonk (pictured right), said:
“We are fully approved by all regulators – the four regulators – local council, Environmental Agency, Health and Safety and Oil and Gas Authority”.
He said Angus was waiting for the Oil and Gas Authority (OGA) to approve an update to the site’s field development plan.
“The moment that arrives we will put the well into production”.
But Surrey County Council told DrillOrDrop on 19 July 2017 that its position had not changed.
A spokesperson said:
“Angus Energy did not have planning permission to drill the sidetrack well BRX-4Z earlier this year.
“Angus Energy do not have planning permission for production from the unauthorised sidetrack well BRX-4Z.”
Rising share price
Despite the conflicting positions, the Angus share price has continued to rise over the past month.
It stood at 10.75p on 20 June and closed today at 31.63p, a rise on the day of more than 20%.
The dispute dates back to at least September 2016 when Surrey County Council told Angus that it did not have planning permission for a sidetrack well.
The well was drilled in January into Kimmeridge limestone, the same rocks being explored by UK Oil and Gas Investments at Horse Hill in Surrey and Broadford Bridge in West Sussex.
In the conference call last week Mr Vonk and the company chairman, Jonathan Tidswell-Pretorius, were asked whether the OGA was waiting for a written statement from the council that planning permission was not needed.
Mr Tidswell-Pretorius said he couldn’t speak for the OGA but added:
“At this point we haven’t received anything official from Surrey County Council. We’ve received no legal letters, we’ve received no legal advice.”
Mr Vonk added:
“It’s been very clear from the beginning. All our planning permissions are in place, have been for years. It’s simply a case of bad reporting. We’ve been very clear in our communications afterwards. This is the last time we will be addressing this issue.”
What is a planning breach?
The Town and Country Planning Act 1990 defines a breach of planning control as
- Carrying out of development without the required planning permission
- Failing to comply with any condition or limitation subject to which planning permission has been granted
Government guidance gives local planning authorities responsibility for taking “whatever enforcement action” may be necessary, in the public interest, in their administrative areas.
According to the guidance, enforcement action is discretionary and should be proportionate. Effective enforcement is importance as a means of maintaining public confidence in the planning system, it says.
A planning authority could choose to take no action, or require a retrospective planning application. It could also issue an enforcement notice, stop notice, breach of condition notice or a planning enforcement order.
During the conference call, the Angus executives did not estimate the flow rate or production volume from the Brockham sidetrack. But they said they were optimistic about the well and described the Kimmeridge limestone as “potentially transformational”.
Mr Vonk said:
“Why we’re so excited, why we’re pleased with the results we got back from the Brockham sidetrack is it is really the first commercial Kimmeridge production we’re focussing on at Brockham.
“Basically we’ve got a 400m thick layer of Kimmeridge part of which 200m is naturally fractured. It is just as mature as Horse Hill and the indications are that we are talking about a single oil column.”
They also said they may sink more wells at Brockham. Asked if Angus had permission for more drilling, Mr Vonk replied:
“There is planning permission in place for a total of six wells. We currently have three boreholes to surface and the three boreholes to surface we could sidetrack depending on the result of the X4Z [the sidetrack] production. Those six wells can all be developed in the future.
“We don’t want to have more sites. We want to achieve the maximum amount from the Brockham site. You can drill from there, same as like the North Sea, it is a small platform but you can access really a wide and larger area. They have a word for that, it’s called octopus drilling. That’s something that we can deploy at Brockham.”
Mr Tidswell Pretorius said the ability to transport oil out of the Brockham site was “not an issue”.
“We don’t have any restriction on the number of trucks that we can move in or out, and things like that, unlike what may have been speculated. And to be honest when the site first designed, it was designed to take some very large tankers, in fact BP had four 800 barrel tankers there initially.”
“We’re also exploring other options. We’ve got train lines nearby, we’ve got pipelines in the area. We have to assess every option. But the amount of oil we produce is not a problem in this case that’s for sure.”
There was also “no issue” technically with Angus drilling from the Brockham area into the surrounding Holmwood licence, Mr Tidswell Pretroius said.
“From a technical point of view, it’s a no-brainer”.
Updated on 21 July 2017 to include date of statement from Surrey County Council