Industry

Grid can take Loxley gas – UKOG

The gas network could accept potential supplies from UKOG’s proposed site in Surrey, the company said today.

Location of UKOG’s Loxley gas site. Source: Surrey County Council

In a statement, UKOG said SGN, the operator of gas distribution pipelines in southern England, had confirmed it had capacity for all future gas production from the Loxley site near Dunsfold.

UKOG said this:

“provides a clear route to the wider gas market and the monetisation of Loxley’s gas”.

The company said SGN could accept 34,500 cubic metres per hour, the equivalent of 30 million cubic feet of gas per day. This corresponded to the high-side forecast for Loxley’s field production rate, the company said.

A study could now begin to identify where the gas could enter the grid, UKOG said.

This is the second update from UKOG on Loxley in give days. Last week, the company said the regulator, the North Sea Transition Authority, had extended the deadline for work to start on the well.

It was originally set for the end of December 2019, then moved to the end of 2021. The latest deadline is 30 June 2024.

UKOG received planning permission last year for vertical and horizontal gas exploration wells at Loxley.

The consent, granted by the then local government minister, Stuart Andrew, included site construction, a new access track and road junction but not gas production or a new pipeline.

The minister noted that there was no presumption in favour of the site being used for long-term production, if it were shown to be viable.

UKOG shares fell today from 0.064p to 0.061p.

6 replies »

  1. “A study could now begin to identify where the gas could enter the grid”.

    The word “could” says it all really, an announcement of nothing happening.

  2. Perhaps the horse comes before the cart, Dorkinian?

    Strange though you whinge about nothing happening when you campaign for nothing to happen.

  3. If UKOG had intended to export any gas production right from the start then they should have done the basic scoping work of establishing network pipeline capacity availability, tie-in location, route mapping & permissions and then pipeline sizing, procurement & installation costs BEFORE they submitted the original application to SCC.

    No good finding something if it costs too much to get it to market.

    Perhaps they never expected to find any gas and were just relying on finding oil. That was my impression from the original RNS’s for PEDL234. (Gas didn’t even get a mention in the CPR) This was all that was said in 2018 “Drilling of two further Kimmeridge Limestone (“KL”) step-out exploration wells in two new sites in the central area of the Licence. One well will also appraise the potentially significant Godley Bridge-1 Portland gas discovery”. Not sure “potentially significant” is of CPR quality.

  4. Hmm, Mike, but the application was not for production. I can just image the excitement in certain quarters about jumping the gun if what you suggest had happened.

    This cart does seem a long way in front of the horse, but patience and the horse may be hitched up and that cart may have some traction.

  5. I guess it wouldn’t be a good time to RNS about Turkey after the tragic earthquake news, Loxley is just an “In other news” item to keep the poor investors hopeful.
    I agree with your comments Mike , it’s like buying a fishing license for a puddle that appeared over the weekend.

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