Share Name Share Symbol Market Type Share ISIN Share Description
Uk Oil & Gas Plc LSE:UKOG London Ordinary Share GB00B9MRZS43 ORD 0.01P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  +0.015p +1.33% 1.14p 1.10p 1.15p 1.15p 1.125p 1.125p 46,022,523 16:35:24
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Oil & Gas Producers 0.2 -2.3 -0.1 - 69

UK Oil & Gas PLC Drilling and Testing Update

12/09/2019 7:00am

UK Regulatory (RNS & others)


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UK Oil & Gas PLC

12 September 2019

UK Oil & Gas PLC

("UKOG" or the "Company")

Horse Hill-1 and Horse Hill-2/2z drilling and testing update

UK Oil & Gas PLC (London AIM: UKOG) is pleased to announce that final site works to accommodate the arrival of the rig to drill the new Horse Hill-2/2z ("HH-2/2z") Portland horizontal well commenced at 1200 hrs, Friday 30 August and were completed yesterday. Test production from the Horse Hill-1 ("HH-1") Kimmeridge oil pool was temporarily shut-in to permit oil storage tanks and flowlines to be relocated to enable safe simultaneous drilling and HH-1 testing operations. Kimmeridge test oil production has now resumed and will continue until the rig arrives, when a further short shut-in will occur to enable the HH-2/2z drilling set-up to be assembled.

Prior to the current shut-in, Kimmeridge test production reached a total of 36,559 barrels ("bbl") of dry Brent quality crude at a final metered rate of 313 bbl of oil per day ("bopd") over the final 48 hour test period. Peak instantaneous rates of up to 374 bopd were recorded during this period. Total aggregate Portland and Kimmeridge test production now stands at a landmark 66,127 bbl. Kimmeridge production is planned to continue during the drilling campaign.

Having signed the relevant drilling and service contracts, the rig is now scheduled to arrive later in September to commence drilling and coring the HH-2 vertical pilot hole, expected to be completed in around 30 days from start. The horizontal well section, HH-2z, with a planned trajectory of up to 1000m wholly within the Portland reservoir, will follow directly afterwards. Further operational updates will be issued in due course.

Following UKOG's recent acquisition of Tellurian's 35% direct share of Horse Hill, the Company now holds a controlling 85.635% interest in the field and surrounding highly prospective PEDL137 and PEDL246 licences, which continue to be operated by UKOG's subsidiary company, Horse Hill Developments Ltd, in which UKOG holds a 77.9% direct controlling interest.

Horse Hill 2018-19 Test Oil Production Milestones:

   --     66,127 bbl aggregate Kimmeridge and Portland oil production 
   --     36,559 bbl total Kimmeridge oil production 
   --     29,568 bbl total Portland production 
   --     No discernible formation water produced from either reservoir 

Stephen Sanderson, UKOG's Chief Executive, commented:

"Following our transformational acquisition of a further 35% interest in Horse Hill, our attention is now firmly refocused upon the Portland oil pool and the drilling of the much anticipated HH-2/2z Portland horizontal well, a key step towards establishing significant long-term production and cash flow from Horse Hill by the end of the year. Meanwhile, the Kimmeridge continues to produce solidly and beyond our technical expectations, which bodes extremely well for the future Kimmeridge development at Horse Hill and elsewhere in our licences in the Weald Basin."

Qualified Person's Statement

Matt Cartwright, UKOG's Commercial Director, who has over 35 years of relevant experience in the global oil industry, has approved the information contained in this announcement. Mr Cartwright is a Chartered Engineer and member of the Society of Petroleum Engineers.

For further information, please contact:

UK Oil & Gas PLC

Stephen Sanderson / Kiran Morzaria Tel: 01483 900582

WH Ireland Ltd (Nominated Adviser and Broker)

James Joyce / James Sinclair-Ford Tel: 020 7220 1666

Cenkos Securities PLC (Joint Broker)

Joe Nally / Neil McDonald Tel: 0207 397 8919

Novum Securities (Joint Broker)

John Bellis Tel: 020 7399 9400

Public Relations

Brian Alexander Tel: 01483 900582

Glossary

 
 horizontal   a well that during drilling is steered so as to 
  well         follow and remain within a particular geological 
               stratum or reservoir unit having a trajectory that 
               runs approximately parallel to the top and or base 
               of the target horizon 
 oil field    an accumulation, pool or group of pools of oil 
               in the subsurface that produces oil to surface 
             --------------------------------------------------------- 
 well test    or flow test involves testing a well by flowing 
               hydrocarbons to surface, typically through a test 
               separator; key measured parameters are oil and 
               gas flow rates, downhole pressure and surface pressure. 
               The overall objective is to identify the well's 
               capacity to produce hydrocarbons at a commercial 
               flow rate. 
             --------------------------------------------------------- 
 

UKOG Licence Interests

The Company has interests in the following UK licences:

 
Asset                   Licence      UKOG           Licence              Operator         Area           Status 
                                    Interest         Holder                               (km(2) 
                                                                                            ) 
                                                                                                     Field currently 
Avington                                           UKOG (GB)           IGas Energy                     temporarily 
 (1)                    PEDL070       5%             Limited                Plc           18.3           shut in 
---------------------             ----------  -------------------  -------------------  --------  -------------------- 
                                                                                                       BB-1/1z oil 
Broadford                                                                                          discovery, Loxley-1 
 Bridge/Loxley/Godley                                                                                 gas appraisal 
 Bridge                                                                                               well planning 
 (2, 3,                                            UKOG (234)           UKOG (234)                     application 
 8)                     PEDL234      100%            Ltd (4)              Ltd (4)         300.0         submitted 
---------------------             ----------  -------------------  -------------------  --------  -------------------- 
                                                                                                     Finalising new 
                                                                                                      site selection 
                                                                                                    to drill Portland 
                                                                                                      and Kimmeridge 
A24 (3)                 PEDL143      67.5%            UKOG               UKOG (7)         91.8          prospects 
---------------------             ----------  -------------------  -------------------  --------  -------------------- 
Horndean                                           UKOG (GB)           IGas Energy                   Field in stable 
 (1)                     PL211        10%            Limited                Plc           27.3          production 
---------------------             ----------  -------------------  -------------------  --------  -------------------- 
                                                                                                    Production tests 
                                                                                                       ongoing, two 
                                                     Horse                Horse                     further appraisal 
Horse Hill                                      Hill Developments    Hill Developments               wells scheduled 
 (5)                    PEDL137     85.635%            Ltd                  Ltd           99.3           for 2019 
---------------------             ----------  -------------------  -------------------  --------  -------------------- 
                                                     Horse                Horse 
Horse Hill                                      Hill Developments    Hill Developments 
 (5)                    PEDL246     85.635%            Ltd                  Ltd           43.6          As above 
---------------------             ----------  -------------------  -------------------  --------  -------------------- 
                                                                                                   Preparing planning 
                                                                                                      submission for 
                                                                                                      Arreton-3 oil 
                                                                                                      appraisal well 
Isle of                                                                                                and Arreton 
 Wight (Onshore)                                                                                    South exploration 
 (2, 3)                 PEDL331       95%             UKOG                 UKOG           200.0            well 
---------------------             ----------  -------------------  -------------------  --------  -------------------- 
Markwells                                          UKOG (GB)            UKOG (GB) 
 Wood                   PEDL126      100%            Limited              Limited         11.2          MW-1 P&A 
---------------------             ----------  -------------------  -------------------  --------  -------------------- 
 

Notes:

1. Oil field currently in stable production.

2. Oil discovery pending development and/or appraisal drilling.

3. Exploration asset with drillable prospects and leads.

4. Contains the Broadford Bridge-1/1z Kimmeridge oil discovery, the eastern extension of the Godley Bridge Portland gas discovery plus further undrilled Kimmeridge exploration prospects.

5. Oil field with three productive and commercially viable zones, EWT ongoing, further drilling campaign scheduled, production planning consent granted in September 2019, development underway.

6. UKOG has a direct 77.9% interest in HHDL, which has a 65% interest in PEDL137 and PEDL246.

7. OGA consent received for the transfer of operatorship from Europa to UKOG

8. Gas discovery pending appraisal drilling and development with underlying Kimmeridge potential

The information contained within this announcement is deemed by the Company to constitute inside information under the Market Abuse Regulation (EU) No. 596/2014

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

END

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