Industry

Angus Energy predicts production from four Weald oil wells in the next three months

Brockham well Brockham Protection Site

Brockham oil site in Surrey 2017. Photo: Brockham Protection Site

Angus Energy announced this morning it would be producing oil from four wells in the Weald in southern England in the first three months of this year.

In a statement to investors, Angus said it would resume production from two currently suspended wells at Brockham in Surrey and Lidsey in West Sussex.

It would also begin production from a new sidetrack at Brockham, the subject of a long-running planning dispute, and its new sidetrack at Lidsey.

The Angus Energy share price rose today by 7.41% to 10.88p.

Suspended wells

Angus said it planned to produce from the Great Oolite reservoir at its Lidsey site in February using the currently suspended Lidsey X1 well.

In March it would begin production from the Portland reservoir at Brockham, using the suspended well BRX2Y.

The total from both wells before suspension had been 50 barrels per day, the company said.

Brockham sidetrack

Angus said its previous guidance on production from the disputed BRX4Z sidetrack at Brockham remained unchanged.

This dates back to October 2017 when the company said in a statement that commercial production from the Kimmeridge layers at Brockham would begin in Q1 2018.

Angus had previously confirmed in a statement in March 2017 that there was potential for Kimmeridge oil production from the BRX4Z, which had been drilled in January that year.

Within days of the March 2017 statement, the company and the BRX4Z were embroiled in a planning dispute with Surrey County Council.

The council insisted that drilling and production from the BRX4Z would need a new planning application. Angus disagreed.

In October 2017, Angus Energy said the council had asked it to submit a planning application for operations associated with BRX4Z (statement to investors). Just before Christmas, the council confirmed that it had received a planning application from Angus (DrillOrDrop report). But at the time of writing, this has not been published.

An application for the sidetrack, either drilling or production from it, would be expected to go through a public consultation. This must be at least 14 days but is often at least 21 days.

To meet the timetable of production by the end of March, an application for production would need to be ready to go before Surrey county councillors at a planning committee meeting on either 21 February 2018 or 21 March 2018.

Before production could get underway, Angus would also need to install equipment to generate electricity from any gas associated with the oil at Brockham. This was a requirement of the Oil & Gas Authority when it approved the company production plans last year.

Angus said today the installation to the Nation Grid was in progress and “contracts have been executed with a scheduled completion in March 2018”.

Lidsey sidetrack

The other new well mentioned in the statement, the X2 sidetrack at Lidsey, was drilled in September 2017.

Initial flow rates, announced in November 2017, were 40 barrels of oil per day, much lower than the 400 predicted by Angus managing director, Paul Vonk, during an interview in July that year.

The company said the well had experienced significant gas locks, causing the pump to fail. A different pump did not fail but the flow rate had declined significantly every six hours.

Angus said today it had completed its review of the initial flow rates. It added:

“The installation of a new pump to optimise pressure differentials and maximize production flow rates will be completed in February 2018.”

Improved market conditions

Referring to its drilling plans, Angus said:

These operations reflect improved market conditions and an increase in oil pricing, and will enhance the Company’s financial flexibility.

At present oil prices are on the rise.  At time of writing, Brent Crude is at over $70 per barrel, its highest price for more than 3 years.

  • DrillOrDrop asked Angus Energy about the Brockham planning application. This post will be updated with any response.

15/1/18 Report updated to include reference to current oil prices

10 replies »

  1. The fairly key part of the RNS that was not within the text above, is that these plans are linked to the improved (higher) recent oil prices.

    ie. when world oil prices are increasing the incentive to drill and develop in UK also increases.

    Obviously, Angus have considered this. Others will do so too.

  2. After so many disappointments and set backs, I hope this marks the beginning of a turnaround for Angus and the other Weald Basin oilers. Clearly, there is big potential here, it’s taking time to bring it to fruition, but given the tiny size of these companies, slowly, slowly is much better than hell for leather, only to crash and burn. We’ve seen it so many times with E&P minnows. Good luck to Angus and the other players. The UK needs you to succeed, and long term too. These wells could produce hydrocarbon for 50 years, or even more.

    • Wressle has proven reserves but we have seen first hand the powers to be don’t want to let onshore O&G kick off. It is not just this industry that is struggling to get any momentum, the government are a disaster but I ultimately blame Corbyn and his cronies for it’s current state. Hopefully Labour will return to being about jobs rather than a bunch of kiddies pretending to know what they’re talking about.

  3. Err, yes, Mike V. Sometimes the reasons are just as important as the process.

    (I think you will find wind turbine manufacturers also do so for money.)

    So, when fracking in USA for oil brings the price down to $40/barrel, exploration elsewhere is not pushed. When oil prices increase back to $70/barrel because frackers in USA are more inclined to look for profitability, then the reverse is the case.

    Strange how the global oil economics still continue in spite of alternative energy development (not.)

  4. Strange post John. Have you spoken with Royal Dutch Shell and Exxon Mobil who are going to invest $1 billion into the Penguins Field, that is currently producing nothing? The plan is that it will then peak at 45k BOD ie. 3 times Wytch Farm (Europe’s largest on shore oil field). Bit bigger than Angus, but same reasoning-if you have the ability to produce considerably below the sales price, then you do so.

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