Industry

Breaking: Oil companies pull out of Leith Hill exploration site in Surrey

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Opponents of oil drilling at Leith Hill react to the news that Europa Oil and Gas is pulling out of Bury Hill Wood. Photo: Fil Jackson, 4 September 2018

Europa Oil and Gas, the company behind oil drilling near the Leith Hill beauty spot in Surrey, announced this morning it was pulling out of the site.

In a statement to shareholders, it said the Forestry Commission was not renewing the  lease for Bury Hill Wood, also called Holmwood. The current lease expires in just over a week on 12 September.

The statement said Europa would now be withdrawing its planning application seeking more time to drill an exploratory well at Bury Hill Wood.

The company said it was disappointed by the lease decision. Campaigners against oil operations at the site were celebrating today at the unexpected news. Leith Hill Action Group, which has been challenging the proposals since December 2008, said today’s announcement shows the value of continuing the fight.

10-year battle

This appears to bring an end to a near 10-year planning and legal battle with residents, campaigners and the council.

Europa was due at the High Court at noon today to request an extension to an injunction against protests at the site. Anti-drilling campaigners occupied the site for eight months until they were evicted in June 2017. They then moved across the road onto Forestry Commission land.

Leith HIll eviction 170622 Rob Harbinson1

Eviction of campaigners from Bury Hill Wood, 22 June 2017. Photo: Rod Harbinson

The Oil and Gas Authority recently extended the initial term of the exploration licence for the site until September 2020. This was the sixth licence extension for PEDL143. (DrillOrDrop report)

The first planning application was submitted on 1 December 2008. It went through two planning inquiries and two court cases before finally being granted three years ago in August 2015.

But no work was carried out on the site, except for water monitoring boreholes. The permission expired on 6 August 2018.

The most recent delay had been over approval of a traffic management plan, which was reportedly in its 14th version. A request to extend the planning permission had been expected to be discussed by Surrey County Council in November.

An Environment Agency permit was granted for the site in July 2018 despite a petition against it signed by more than 100,000 people and nearly 2,000 objections (DrillOrDrop report)

“Disappointment”

Today’s statement said Europa had been notified that the Minister for Environment, Food and Rural Affairs, had decided not to renew the lease at the exploration site.

Europa said:

“Following the Minister’s decision, the Company, on behalf of its partners, will be withdrawing its planning application to drill the Holmwood prospect from the Bury Hill Wood site.”

Europa and its four main partners (Egdon, Angus Energy, Union Jack and UK Oil & Gas plc) planned to explore the Kimmeridge limestone formation.

Europa said :

“The Company, with its partners, intends to undertake a full evaluation of alternative sites from which to target the Holmwood prospect, and other plays in the licence.”

Europa’s chief executive, Hugh Mackay, said:

“The Minister’s decision not to renew the lease at Bury Hill Wood is disappointing, however, we intend to continue to work closely with our partners to determine how best to take the licence forward. As well as PEDL143, Europa holds a multistage portfolio of licences which includes production and appraisal projects onshore UK and an industry leading licence position in the Irish Atlantic Margin. Various work streams are underway across our asset base to advance all our licences and in the process expose our shareholders to high impact drilling activity. With this in mind, I look forward to providing further updates on our progress.”

In an interview with Proactive Investors, Mr Mackay was asked if he believed protests at Horse Hill had been a factor in the decision on the lease. He replied:

“I don’t think it helped, put it that way. I can’t really speak for the Forestry Commission and DEFRA but I’m sure the presence of protestors wasn’t helpful from anyone’s perspective.”

David Bramhill, executive chairman of Union Jack Oil, said in a statement:

“The potential consequences of the Minister’s decision are minimal for Union Jack as it holds a balanced portfolio of ten attractive onshore licence interests in the UK, including producing assets at Keddington and Fiskerton, a development project at Wressle and a planned well at Biscathorpe to be drilled during October/November 2018.”

Mark Abbott, managing director of Egdon, said in a statement:

“The Minister’s decision is highly frustrating. However, we note the commitment of the operator to evaluate alternative sites and we will work with Europa and the joint venture partners to agree a forward plan for the licence. Meanwhile we will continue to progress our plans across our broad and extensive portfolio of UK projects.”

Stephen Sanderson, executive chairman of UKOG, said:

“The decision by the Minister for the Environment, Food and Rural Affairs, is disappointing, but not altogether surprising. As the Leith Hill Site was less than ideal, we now welcome the opportunity to plot a new way forwards to drill both the Holmwood prospect and other nearby prospective Kimmeridge targets in the near future.”

At the time of writing (9.20am) Europa shares were down 5.8% at 3.62p. Shares in the partner companies were also down: UKOG down 2% at 2.5p, Angus Energy down 3% at 7.15p, Egdon down 8.9% at 7.8p and Union Jack down 1% at 0.1p.

“The value of continuing the fight”

Leith Hill Action Group, which has campaigned against Europa’s plans for nearly 10 years, described today’s announcement as “incredible news”.

In a newsletter to members, Patrick Nolan said:

“We have learnt over the last ten years to be cautious on hearing good news.  However, this does appear to finally be the end for Europa’s attempts to drill at this totally inappropriate site.

Over the last ten years, we at the Leith Hill Action Group have been told by many people in many circumstances that we were just fighting the inevitable.  It has been put to me in radio interviews that it was pointless to keep going and that we should just let Europa get on with it.  We have faced attitudes from public officials that we were just delaying the unavoidable.  However, today’s announcement shows the value of continuing the fight.”

Mr Nolan said the group had “fought to ensure that every condition is met in full and every legal nicety is properly observed”:

“In three years since being granted permission, Europa have not been able to fulfil the conditions simultaneously imposed on them by the Inspector and it seems that their time has finally run out.” 

“Inappropriate location for oil drilling”

Lucy Barford, of the campaign group, A Voice for Leith Hill, said:

“This is fantastic news.

“It’s been a combined effort of so many people – both local and from further away –  over such a long time. It really is an extraordinary success”.

“Leith Hill has always been a completely inappropriate location for oil drilling, in addition to the overall issue that we should be leaving all fossil fuels in the ground.

“Local campaigners have been fighting Europa’s plans for a decade and we are overjoyed that the Forestry Commission and the Government minister have finally seen sense and put a stop to the horrendous prospect of oil being drilled in such a beautiful and vulnerable environment.

“There will be other battles ahead, oil drilling is still planned for other sites across the Weald, but for now we will be celebrating the fantastic news that there will be no oil drilling at Leith Hill.

“It has cost thousands of pounds to fight this and many hours of effort. Thanks to all who saw sense in the end and stopped this highly damaging plan going ahead.

“Don’t let anyone tell you protests don’t achieve anything”

Keith Taylor, the Green Party MEP for south east England, said in a statement:

“I’m delighted that Europa’s lease hasn’t been renewed. There is no place in our precious Surrey Hills AONB for environment and climate-destructive oil drilling.”

“Don’t let anybody ever tell you protests don’t achieve anything. They do. Residents and campaigners have been fighting drilling plans at Leith Hill for almost a decade; they have frustrated Europa every step of the way. Their dedication is amazing. I have been honoured to support them in their fight. This victory is unmistakably theirs.”

“It is just the latest example of the power of organised and peaceful resistance. It is this power so many oil and gas firms are seeking to crush with increasingly wide-ranging and draconian injunctions.”

“Europa says it’s looking for alternative sites in the area, but deep down I suspect they know the jig is up. That doesn’t mean we won’t be keeping a watchful eye.”

“Death knell for oil exploration in Surrey Hills”

Brenda Pollack, south east campaigner for Friends of the Earth, said:

“This is the culmination of a decade’s planning and legal battle, so it’s excellent news and a significant victory for local people. It has been one of the longest running battles against an oil company in England by residents. The Surrey Hills is just not the place for climate-wrecking oil drilling and it sounds the death-knell for oil exploration here. 

“At a time when we know that burning fossil fuels is contributing to a climate crisis the government shouldn’t allow further drilling and carving up our most precious countryside by companies whose main interest is profit.”  

DrillorDrop page on Bury Hill Wood/Leith Hill

50 replies »

  1. I think long term this works for all involved. Locals are happy. And hopefully targeting with drilling from brockham may be cheaper too. With less struggle through the planning process as already an existing site.

      • No, targeting the holmwood prospect with a directional drilling / horizontal well from Brockham. Leith hill is just above the reserve now.

        • Ha, I didn’t think you were suggesting drilling for oil above ground Gregoryyy, that would be ridiculous!

          But targeting Europa’s PEDL143, from Angus’s well pad at Brockham is a fantasy. It might be technically possible to reach it but prohibitively expensive, especially for an exploration well, even if the regulators allowed it.

  2. Agree with you, Gregoryyy. Simply what happens as an area is explored. Some sites found to be less suitable than others, for a multiple choice of reasons. Think wind farms have found the same.

    • Hilarious predictable comment

      ‘Simply what happens as an area is explored. Some sites found to be less suitable than others’

      Did Europa state they were leaving prior to

      ‘Today’s statement said Europa had been notified that the Minister for Environment, Food and Rural Affairs, had decided not to renew the lease at the exploration site.’

      No they did not

      Simply they have been told to pack their bags and go. Ridiculous attempt to try and suggest otherwise.

      I think short term it is a disaster for the company. The long term effects will be more divestment from an industry with shares trending downwards.

      More fights being won. More community groups forming. More resources coming available.

      Win win win situation.

      • Could we have the stuff about Putin and lights going out. It’s been a while. Also not had the ‘ I presume they all ride bicycles and don’t drive cars’ nonsense for a few days. Comments like this really highlight the strength of the support for the industry. Please also include Jim and his ability to turn the North sea off. That’s my favourite.

      • Well they’re not going to give up on something they’re so invested in are they J P, unless no other option. Its a shame it has come to this and it is ultimately because of the delays. A shame, but not terminal. The fight has merely moved over to the next village along. Where there is more likelihood of planning permission as existing site.

        • ‘Well they’re not going to give up on something they’re so invested in are they’

          That will be a decision by the investors no doubt.

          Still a ‘razor sharp’ company like this should have no problem convincing the shareholders to try again and come up against more community opposition.

          • Haha next village , what has happened to investors cash that has been wasted already on this non idea ? If you are happy to keep funding wages for these non people then that’s your affair but wherever you go it will be the same result . Now have a nice evening and don’t lose sleep over it .

  3. “So how come these razor sharp businessmen didn’t realise this 10 years ago and save themselves, the police, the courts and everyone else involved all the time and effort involved in achieving the inevitable then? Arrogance, cognitive dissonance, plain stupidity or all three?”

    Quite, Dennis May, well said. Leaves you wondering about the company’s competence in their day job overall too.

    I was brought up & spent my childhood only 5 miles from Leith Hill, our Dad took us on walks there regularly. Wonderful, tranquil place with beautiful (but very narrow!) lanes – would have been utterly wrecked by drilling. Fantastic result, well done all the protesters and protecters, what a terrific Tuesday!

  4. Oh dear John.

    Why would they state to anyone they were leaving until they were told they could not proceed?

    For those who invested in Europa based solely upon this “asset” it may be a problem, but I suspect there are very few of them-it wasn’t that big. Meanwhile in the Weald, testing is still being conducted, injunctions granted, more testing planned, production planned and other assets being consolidated. Yes, looks like a win win win situation. Indeed, some extra funds will now be available for that following this announcement.

    If it makes you happy, I suspect there may be one or two other sites that are not developed. (This is not the first.) Equally, there will be existing ones that are and some new ones that may go either way. Some sites will be found more suitable than others-did you not observe that in the N.Sea?

    Quite usual.

    May become a little more exciting when there are companies who are not only exploring but producing enough to fund their exploration internally. Then you will be able to forget your concerns for those silly investors.

  5. Ukog Steven Sanderson statement As leighhill was less than ldeal .We now welcome a new opportunity to target holmwood prospect and near by prospectives for the kimmeridge in the near future .Side track from Ukog HH and angus energy brockham.Much cheaper than new site Win win win for companies and an investors .And you have your Beauty spot back residents win win

    • Back to reality

      ‘Today’s statement said Europa had been notified that the Minister for Environment, Food and Rural Affairs, had decided not to renew the lease at the exploration site.’

      Share prices down showing investors concerns in the company.

      Not really a ‘win’ now is it?

      • A definition of ‘win’ is to be ‘successful’

        If Europa intended to spend millions of investors money to develop a site they hoped would not produce any returns then ‘Yes’ they have been successful and therefore have achieved a great ‘Win’

        • Less than ideal enough to purchase 40% of nothing ? UKOG are fuming too but will still feed investors rubbish to pay huge salaries . Drilling from either HH or Brockham would never happen .

    • I said it is good new for angus energy .As they will not need to contribute £800,000 to the drill at holmwood Leigh hill .And can side track from brockham or other sites .Win Win

      • But surely Leigh hill would have been a ‘Gusher’ or are you suggesting they invest in sites they don’t believe would be viable. Surely for Angus it must be a serious setback to loose out on what was presumably expected to be a good return.

        If you are saying they deliberately invest in worthless developments what do they tell the investors to keep the money coming in?

        There isn’t a business in just promising, delaying and never quite getting round to doing the job is there?

        Surely not

  6. And when you do that fren, you find clever legal types claim that if that is allowable, so is a housing development. And they win. I could take you to such a site and now there is talk about industrial to follow.

    At least the houses being built by a local builder. The solar farm was constructed by a group who came over from Poland in their diesel Transit vans and then returned in same with their wages.

    Happy land owner, happy ecos, locals pretty unhappy. Imported food.

    The reality.

    • Martin. You obviously didn’t know that the seismic surveying across much of the North of England was carried out by teams of men from Poland – that is also where their ‘thumper trucks’ originated from. In a frank discussion with a director of the fracking company, he admitted that NO local people had been employed. Your arguments need to be better researched methinks.

  7. I think you need to DYOR Keith. If you did you would find on DOD, to be precise, a copy of an advert for employment for seismic testing. It caused a bit of a stir at the time. (Apology not expected.)

    Land owners in the north are quite used to seismic testing for all sorts of things. All sorts employed. There used to be a coal industry, for example.

    But, don’t let facts get in the way of your excitement. A bit of fantasy often helps.

    • Seismic monitors at Becconsall installed by American company micro seismic inc. Well over 100 monitors.

      http://www.marketwired.com/press-release/microseismic-inc-install-first-permanent-microseismic-monitoring-array-outside-north-1666104.htm

      Cuadrilla stated in their original planning application that there would be very little local employment at Becconsall. They were correct.

      REAF did however create employment at the site. Our commissioned extended phase 1 habitat report and peer reviewed acoustic report have created work.

      Now Leicester based Fox demolition have found work restoring the site after Cuadrilla withdrew their fracking application and were forced by LCC to restore the site.

      Maybe the jobs figures for the industry are based around the employment of specialists and legal teams by the anti fracking community.

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