UK Oil & Gas plc has announced that production has resumed from the Portland oil formation at Horse Hill in Surrey.
The company, which is the largest investor in the project, said today the Portland flow rate was between 208 and 218 barrels per day (bopd). This is lower than previous reports which calculated an optimised sustainable rate of 362 bopd.
In a statement to shareholders, UKOG said the current flow was being maintained below this rate for “prudent reservoir management purposes”.
It said the resumption of oil flow after a six-month shut-in formed:
“a key part of the schedule of works required to finalise the Portland field development plan and to the targeted establishment of permanent long-term Portland production, planned by end 2019.”
In October 2018, UKOG declared the Portland oil field to be “commercially viable”.
The site, near Gatwick Airport, has planning permission and environmental consents to drill two new horizontal wells at Horse Hill. One of these, to be called HH-2, will target the Portland and is due to be drilled in spring 2019, the company said.
UKOG said the ongoing flow tests on the original well, HH-1, would continue until the completion of the HH-2 well. Portland test production would then switch to HH-2, today’s statement said.
Additional horizontal wells at Horse Hill, which are currently going through the planning system, were designed to further boost Portland production and put UKOG in the top three onshore producers, the company added.
UKOG said the section of the HH-1 well targeting Kimmeridge oil had also been shut-in to conduct a long-term pressure build up test. Kimmeridge test production would follow drilling of HH-2.
UKOG’s chief executive, Stephen Sanderson, said:
“We remain on course to commence the first two horizontals in Spring, with long term production testing of both wells planned to follow directly afterwards. The flow test results to date, combined with the prospect of further near term drilling, place Horse Hill in a strong position to deliver positive “free” cash flow to UKOG in the near and foreseeable future.”
A public consultation on plans for four more oil wells and a water reinjection well at Horse Hill ended last week.
Online comments on the application on the Reigate and Banstead Borough Council website totalled 552 at the time of writing: 316 in support and 235 against.
24-hour production at Lidsey
West Sussex County Council has approved plans by Angus Energy for round-the-clock oil production at its Lidsey site, near Bognor Regis.
An application to vary the production hours was granted on 15 February 2019 by planning officers acting under delegated powers.
A condition of the consent restricts other operations at the site and deliveries to 7.30am-6pm on weekdays and Saturdays, except for emergencies.