UK Oil & Gas plc reported an operating loss of £1.32m for the six months to the end of March 2023, slightly larger than the year before.

The interim accounts, published yesterday, also revealed that revenue was down slightly but expenses and cash outflow from operations were up compared with the same period a year ago.

Operations update

Dorset hydrogen storage

The company said it had focussed during the accounting period on its hydrogen storage project at Portland Port in Dorset.

The plans include 19 hydrogen storage caverns, UKOG said. Each would be around 90m tall, with the same volume as St Paul’s Cathedral.

Phase 1 would provide around 1 billion cubic metres of storage, UKOG said. This would be around 10% of the UK’s estimated strategic hydrogen storage capacity by 2030. The second phase could double this capacity by 2035, the company said.

Loxley/Dunsfold

UKOG said hydrogen produced from methane extracted at the Loxley site in Surrey would “make a valuable contribution to the UK’s future hydrogen economy”.  

The company said:

“Once the field has been depleted of natural gas, Loxley can also be repurposed to store around 1 billion cubic metres of hydrogen, which is around a tenth of National Grid’s mid case Future Energy Scenarios forecast of required hydrogen storage by 2035.”

Broadford Bridge

UKOG said it was in “technical and commercial discussions” with CeraPhi Energy about geothermal and agribusiness project using Broadford Bridge well in West Sussex.

Turkey

UKOG said testing operations at it is Pinarova-1 had been temporarily suspended in late May 2023 to “access larger and more powerful 7-inch perforating guns, capable of fully penetrating Pinarova’s 9⅝-inch casing and cement”.

So far, UKOG said, “tests have not yet been able to assess the potential of the zones associated with the 12 hours of strong crude oil odour and oil at surface as previously reported”.

Key figures for six months to 31 March 2023

Operating loss: £1.32m; (six months to 31 March 2022: £1.286m)

Revenue: £0.89m; (six months to 31 March 2022: £0.91m)

Net cash outflow from operations: loss of £1.569m; (six months to 31 March 2022: loss of £1.388m)

Admin expenses: £1.676m ((six months to 31 March 2022: £1.402m)

Loss before taxation: £1.396m; (six months to 31 March 2022: £1.356m)

Total non-current assets: £36.608m; (six months to 31 March 2022: £38,423m)

Total assets: £39.630m; (six months to 31 March 2022: £41.499m)

Total liabilities: £4.952m; (six months to 31 March 2022: £5.355m)

Expenditure on exploration and evaluation assets: £0.64m; (six months to 31 March 2022: £0.89m)

Expenditure on oil and gas properties: £0.115m; (six months to 31 March 2022: £0.122m)