Biscathorpe oil exploration site, Lincolnshire Wolds Area of Outstanding Natural Beauty, 6 January 2019. Photo: Eddie Thornton
Egdon Resources’ new well at Biscathorpe, near Louth in Lincolnshire, has failed to encounter the oil formation it was targeting, the company said this afternoon.
In a statement to investors, the company said the well would now be sealed and suspended, as a possible future site for a sidetrack.
Shares in Egdon closed the day down nearly 22% at 6.25p.
Shares dropped sharply on news of the Biscathorpe well, 20 February 2019. Chart: London South East
Egdon said the primary objective of the well – the Basal Westphalian Sandstone – was poorly developed at the Biscathorpe-2 well site. The formation was not thickened, as had been predicted in the pre-drilling model.
The company said the results of logging the well, spudded earlier this year, showed there was evidence of proximity to an effective petroleum formation in the Dinantian Carbonate. But it said the formation had very low porosity and would not make an effective reservoir.
The statement said porous sandstone reservoir intervals had been encountered in the shallower Westphalian sequence but they were all interpreted as water wet.
The Westphalian Sandstone had potential to be more thickly developed to the north and north east of the Biscathorpe-2 location, the statement added.
Egdon said:
“The forward plan is to seal the open-hole section with cement and to suspend the well in order retain the option for a potential future side-track. This will be considered once the new well data is integrated into an updated subsurface model. Any further drilling operation would require additional consents including planning permission.”
The company’s managing director, Mark Abbott, said:
“Although the Biscathorpe-2 well did not encounter the thickened Basal Westphalian Sandstone as predicted, we are encouraged by the presence of shows in the underlying Dinantian Limestone which demonstrates a functioning petroleum system and we will now take some time to incorporate the results of the well into our prospect model before deciding on the future strategy for further evaluating the Biscathorpe Prospect.”
Egdon said the well had been drilled to a total depth of 2,133m. But logging had been delayed when wireline tools had been unable to get to the total depth because of hole conditions.
Protest outside Biscathorpe oil site, 3 January 2019. Photo: Jane Rushby
The Biscathorpe wellsite had seen regular protests by opponents of the onshore oil and gas industry. It is in the Lincolnshire Wolds Area of Outstanding Natural Beauty and close to a protected chalk stream.
Egdon failed to drill the well during the first three years of its planning permission, granted in March 2015, citing low oil prices.
In May 2018, Lincolnshire County Council granted the company an extension of planning permission until December 2020. A request for a judicial review of this decision was refused by the courts.
One opponent of the operation, Elizabeth Williams, said in response to the news:
“My fear is that this will lead to a perceived entitlement to apply for well stimulation methods with alarming echoes of Wressle-1 and the planning history there”.
This is the second UK onshore well in two months that has failed to encounter its target formation. IGas’s Tinker Lane shale gas well in north Nottinghamshire, failed to find the Bowland Shale in December 2018.
Another Egdon site in Lincolnshire – Wressle, near Scunthorpe – is heading for its second public inquiry. In November 2018, North Lincolnshire councillors refused permission for long-term oil production for the third time. Egdon has appealed and the details are now on the Planning Inspectorate’s website. A date has not yet been set for the inquiry.
Egdon said it expected to issue an operational update in the coming week, ahead of its six-month interim results.
Categories: Industry
All I can say is Hahaha
If they fell in a barrel of nipples they would come out sucking their thumb 😉 what a nice day it has been .
Jono
As noted earlier here on DOD ( linked to company information ) 40% chance of success.
So 1.5 more wells to drill at that expected rate of success maybe. Something to look forwards to.
https://www.mining-technology.com/features/mining-the-uk/
Here ( above ) are a few more mineral extraction projects ongoing …. let’s see how they pan out.
Tungsten mining has failed ( plenty of Tungsten, but could not extract it profitably given the plant they built ).
Potash looking for cash
Cornish Lithium in trouble ( difficult drilling )
No so easy I guess as importing all this stuff.
But Misson are coring the shale ( it seems ) so Misson well on track.
There’s more than a 40% chance of getting rich by finding cash down the back of a second hand sofa.
Jono
Maybe so, but I have 30 years of around 5% annual return from fossil fuel and renewables investment, so I need a big second hand sofa to look behind to match that.
Jono
Maybe, but I do not think so, maybe 1 in 14 Million for cash down the sofa to make you Rich.
Bit if you have no money, the lotterty is a good bet ( to buy the dream ).
My concern is that Egdon have a statutory duty to return the site to it’s previous condition..however if they ‘sell it on’ to an asset stripping company who subsequently go out of business..restoration costs will fall on the ‘State’ purse…. this is what has happened all over the U.S.
Dianna
See the Eakring and Egmanton oilfield for sites returned to previous condition ( and some still to restore ) though past drill sites were not as extensive as today’s pads.
If we are lucky it will be planted with trees rather than returned to factory farmland.
I hope that the fairly new protest camp near this site will have the same regard to the encampment they have recently set up. They have a concrete fire pit which I’m assuming they are planning to remove when they leave and return the site to the way they found it? Will they be taking their Saturday piss ups to another camp?
Miss Fired , sounds like what Egdon did , don’t worry about camps , they don’t poison people with a fire pit
Dianna, do you worry the same about the clean up costs if other industries go bust or is it just the petroleum industry that keeps you awake?
Interesting last minute of this although I would recommend watching all of it , AIM PONZI scheme and the Gatwick Gusher named with Dave Liargas https://www.ii.co.uk/discussion/t/aim-market-rigged/1147148?fbclid=IwAR3oISrVozctrGOZnAOEdqEI93PZMwD-6cB0lDyFaOrWcqkMw47JXhwt3v0
Jono
When did it say that those in at the start ( UKOG ) should bail out. Up over 100% from then, so better than Sainsburys over that time, or Carillion, Marks and Sparks ( and so on ). But buyer beware on AIM.
Maybe it’s the mug lenders who are being taken for a ride as investors can buy and sell at will.
I would suggest that investors try the save under the mattress scheme or the Grand National for better chance to make some Dirty Cash
Jono
Invest in battery metal mining. Try Nickel, or Ilmenite, but not a Lithium ( see Cadence Minerals ).
But having some cash in hand is a well promoted idea, but not under the bed as thieves look there first it seems!
Plus bookies are a better investment than betting on a horse ( true mug punters ).
Investors get locked in , they have stop losses triggered by such falls , its a mugs game , all bragging about how much they have made while trying to avoid the wife when it comes to buying the shopping . chase the dragon . Why not invest in renewables ? Its the future . short term gains are eaten away unless you are a day trader .
Jono
I agree. Just as the father in law always ‘gets his money back’ at the bookies, speculative betting on aim makes only a few rich, but few brag about losses. A 1970s book on penny shares ( which mentions polly peck ) notes that some people have been ruined by betting on such shares.
But these shares may be oil and gas or renewables, especially for those minerals which support battery production. So buyer beware.
You cant de risk 0% of nothing 🙂
Jono
That’s why they gave a 40% chance of success.
Ruth
Although Tinkers Well did not find a worthwhile thickness of shale, it seems the well was a success in delineating the edge of the shale and gave some interesting information relating to gas in what they found.
https://www.fircroft.com/blogs/fracking-tests-reveal-us-levels-of-gas-in-british-shale-94918164115?utm_campaign=EngineeringPro+-+Issue+19+-+20th+February+2019&utm_source=emailCampaign&utm_content=&utm_medium=email
Hence once could say that both wells ( Biscathorpe and Tinkers Lane ) were Technically Successfull in that they have both furthered the quest for information on their respective targets.
A glass half full thought.
[Typo edited at poster’s request]
The well was a success? Really?
I suppose it’s a bit like playing Battleships. You choose a square and if there’s nothing there you call it a success because the battleship must be in some of the other squares. 😉
David
Thanks
It was a running joke in the oil industry that all wells that did not find what they wanted were judged by the drillers as a ‘Technical Success’. Ie drilled to depth, on time and on budget.
But your analogy re battleships is close, each guess ( or hole ) brings you closer to success, should it be there. Similar to me looking for something I have lost, each draw opened with no result is useful information.
Few oilfields are easily found, especially as the easiest have already been found.
Gas gas gas otherwise known as BS. There will be no need for us Swampies soon as the industry that used to be on it’s knees is now on it’s ankles
Yeap, that’s why current world demand is just over 100 million barrels/day.
Is Martin ok ? Has anyone heard from him today ? Im worried about him .
No need to worry Jono. Martin has always made a profit on Egdon (but not invested recently.)
I know-money, money-but it seems to be your fixation. Invest in renewables? I am, but better get reaction on board first, then he can advise everyone else to follow his lead rather than ignore it. (Currently some of my renewable investments are not much better than if I was invested in Egdon-but, if they were, then I might have cashed in and be looking at Egdon! Or Tesla?-LOL)
But, just look on the bright side. The lady who was worried about being excluded can relax now.
Or, maybe the reality was Martin was getting the greenhouse sorted so that he can cash in on the great lettuce shortage that the retailers have predicted come Brexit! Now, there’s a Little Gem of investment advice!
Renewable investment would be boosted once we started to divest from Fossil fools
Really? Try telling them that in Swindon and Sunderland! Caring sort of soul, aren’t you.
Along with losing the shale, very questionable geological analysis and constantly demanding lesser (fools?) gold standards, new seismic regs and chemicals to operate, you can’t help but feel these are just cowboys operators flying by the seat of their pants. Still, they always seem to have a slightly desperate ‘success’ claim to attempt to keep their investors confident.
Mike Potter
Egdon were not looking for shale. Are you thinking of Cuadrilla or INEOS?
I was referring the the fledgling English industry generally.
Mike
Fracking companies then ….? The onshore oil industry has been around for decades as the many drilled wells and oilfields will attest to.
Almost as questionable as the pitches from the solar panel salesmen! But, that’s “alternative” so nobody sees that.
Oh yes they do.
Mike
Tho Biscathorpe was not a wildcat, looks like there are a few planned across the globe. Most eye watering in cost and targeting large reserves.
https://www.fircroft.com/blogs/the-most-exciting-wildcats-of-2019-95120105127?utm_campaign=EngineeringPro+-+Issue+19+-+20th+February+2019&utm_source=emailCampaign&utm_content=&utm_medium=email
Looks like an industry on it’s last legs? All forecasts showing increasing global demand for oil and gas into late 2030’s (oil) and 2040’s gas. Only 550 exploration wells being drilled offshore next year? And increasing year on year. Clearly the protests the other day are having a major impact.
https://www.offshore-mag.com/articles/2018/12/offshore-drilling-market-recovery-expected-in-2021.html