TIDMUKOG
RNS Number : 4529H
UK Oil & Gas PLC
01 August 2019
UK Oil & Gas PLC
("UKOG" or the "Company")
Horse Hill-1 production hits 60,000 barrels via new Phase 2
Kimmeridge test
UK Oil & Gas PLC (London AIM: UKOG) is pleased to announce
that in preparation for the late summer start of the Horse
Hill-2/2z ("HH-2/2z") Portland drilling programme, test production
was switched successfully from the Portland to the deeper
Kimmeridge oil pool. From 6(th) July to date, the Phase 2
Kimmeridge test has produced a further 5,524 barrels ("bbl") of dry
Brent quality oil. Total aggregate Portland and Kimmeridge test oil
production from the Horse Hill oil field, in which the Company has
a 50.635% majority interest, now totals a significant landmark of
60,186 barrels ("bbl").
Kimmeridge oil flow was re-established at initial half-hourly
metered rates of up to 332 bbl of oil per day ("bopd"), with
continued stable production of dry oil at daily rates of 200-266
bopd. Total Kimmeridge production to date, now exceeds 30,618 bbl
with no apparent produced formation water. Following a 5-month
shut-in, flow rates and flowing bottom hole pressures appear more
stable than during Phase 1 Kimmeridge testing.
Prior to the Kimmeridge production switch, which was necessary
for the safe drilling and coring of HH-2/2z through the Portland
reservoir, total aggregate Portland production reached 29,568 bbl,
with HH-1 continuing to produce dry Portland oil at a stable rate
of over 220 bopd. Preliminary Company analysis of the final
Portland pressure build-up test, indicates that the Portland
connected oil volume accessed by HH-1 has significantly increased
from 7-11 million bbl to 11-14 million bbl, a robustly commercial
volume.
Kimmeridge test production is planned to continue throughout the
drilling of HH-2/2z except for two short shut-ins to enable the
moving of oil storage tanks and installation of the drilling rig.
The drilling rig is now scheduled to arrive on site following
routine servicing after the completion of its current job.
The Horse Hill oil field and surrounding highly prospective
PEDL137 and PEDL246 licences are operated by UKOG's subsidiary
company Horse Hill Developments Ltd, in which UKOG holds a 77.9%
direct interest.
Horse Hill 2018-19 EWT Oil Production Milestones:
-- 60,186 bbl aggregate Kimmeridge and Portland oil production
-- 29,568 bbl total Portland production
-- 30,618 bbl total Kimmeridge oil production
-- No discernible formation water produced from either reservoir
-- Stable Portland test production has continued to prove more oil in the ground
-- Kimmeridge flow resumed at more stable rates and flowing pressures after 5 month shut-in
Stephen Sanderson, UKOG's Chief Executive, commented:
"The resumption of Kimmeridge oil flow at more stable rates than
previously seen is welcome news for the Kimmeridge's commercial
future and further justifies the decision to conduct simultaneous
Portland drilling and HH-1 Kimmeridge test production at the site.
The successful production switch from Portland to Kimmeridge now
paves the way for the expected late summer arrival of the rig and
the HH-2/2z Portland horizontal drilling and testing campaign.
The test results to date also signify that after a year of
production testing, the simple non-optimised vertical HH-1 well
remains capable of continuous production from both Portland and
Kimmeridge zones at an aggregate rate of 450 bopd. Consequently, as
a result of the test's ongoing success, in the opinion of the
Directors, the future potential for significantly higher rates from
the Portland HH-2z horizontal together with production from the
underlying Kimmeridge therefore remains an even more tangible,
imminent and exciting prospect."
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
core or coring a drilling technique that involves using a doughnut-shaped
drilling bit to capture or "cut" a continuous cylinder-shaped
core of undamaged in-situ rock. The core is captured
in a steel pipe or "core barrel" above the bit.
Core is normally cut in 20 ft lengths, or multiples
of 20 ft, and normally with a diameter of 3.5 or
4 inches. Core is taken in petroleum reservoir
rocks for detailed laboratory analyses of petrophysical
and geomechanical parameters
extended well a well test, as per the permission granted by the
test or production Oil and Gas Authority, with an aggregate flow period
test duration over each zone of greater than 96 hours;
the objective being to establish whether a discovery
is commercially viable and the optimal methods
of future production and recovery
---------------------------------------------------------------
flow test a flow test or well 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
---------------------------------------------------------------
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
---------------------------------------------------------------
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 shut
(1) PEDL070 5% Limited Plc 18.3 in
---------------------- ---------- -------------- -------------- -------- -----------------------
BB-1/1z oil discovery,
Broadford Loxley-1 gas
Bridge/Loxley/Godley appraisal well
Bridge (2, UKOG (234) UKOG (234) planning application
3, 8) PEDL234 100% Ltd (4) Ltd (4) 300.0 submitted
---------------------- ---------- -------------- -------------- -------- -----------------------
Finalising new
site selection
to drill Portland
and Kimmeridge
A24 (3) PEDL143 40% 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 Hill Horse Hill further appraisal
Horse Hill Developments Developments wells scheduled
(5) PEDL137 50.635% Ltd Ltd 99.3 for 2019
---------------------- ---------- -------------- -------------- -------- -----------------------
Horse Hill Horse Hill
Horse Hill Developments Developments
(5) PEDL246 50.635% Ltd Ltd 43.6 As above
---------------------- ---------- -------------- -------------- -------- -----------------------
Preparing planning
submission for
Arreton-3 oil
Isle of appraisal well
Wight (Onshore) and Arreton South
(2, 3) PEDL331 95% UKOG UKOG 200.0 exploration 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,
development underway subject to grant of planning consent expected
in Q3 2019.
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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