TIDMUKOG
RNS Number : 7658U
UK Oil & Gas PLC
27 November 2019
UK Oil & Gas PLC
("UKOG" or the "Company")
HH-2z Completed as Horse Hill's First Future Horizontal Oil
Production Well
UK Oil & Gas PLC (London AIM: UKOG) is pleased to announce
that its Horse Hill-2z ("HH-2z") Portland horizontal well (UKOG
85.635% net controlling interest) has been completed and
temporarily suspended as a future oil-production well. HH-2z is now
ready to enter into the planned extended well test ("EWT")
campaign. EWT operations are expected to start in early December,
once the rig has left the site.
Following displacement of drilling fluids to clean completion
brine, well completion operations included: the installation of
4.5" diameter slotted steel liner, production tubing, a
high-capacity/high-rate downhole electric submersible pump ("ESP")
and a new wellhead. Immediately following rig departure, HH-2z flow
lines and ESP control cables will be connected, and the site's oil
stock-tank storage capacity will also be significantly
increased.
To permit safe operations during the HH-2z rig-down operation,
HH-1 Kimmeridge EWT production has also been temporarily shut in.
Oil production from the HH-1 EWT has continued throughout HH-2/2z
drilling and is planned to resume in parallel with the HH-2z EWT.
Total HH-1 test production now stands at over 78,844 barrels
("bbl"), with over 49,276 bbl from the Kimmeridge oil pool.
HH-2z Summary
The HH-2z drilling campaign successfully delivered approximately
2,500 ft of horizontal trajectory wholly within the Portland
reservoir's most oil productive zone or "sweet-spot". The gross
thickness within the sweet spot is approximately 70 times greater
than in the HH-1 Portland vertical discovery well.
The significantly increased exposure to the sweet-spot within
HH-2z, the first horizontal well in the field's Portland oil pool,
is the prime technical enabler for HH-2z to be capable of
delivering significantly greater flow rates than those seen in the
HH-1 vertical well.
Preliminary HH-2z electric log analysis suggests the horizontal
trajectory has penetrated good to excellent reservoir quality and
high oil saturations throughout the 35 ft thick sweet-spot zone.
The drilling fluid density required whilst drilling the horizontal
is also strongly indicative that HH-2z has penetrated an area of
the Portland oil pool with significantly lower pressure depletion
than expected, a positive indication for possible larger connected
oil volumes than previously recognised.
HH-2z EWT Forward Plan
The HH-2z EWT testing programme will commence with a planned
sequence of normal well "clean-up" operations, designed to ensure
that the well can deliver at its full production potential. The
clean-up process will run in tandem with flow periods and pressure
build up tests.
Once full clean-up is achieved, the well will be flowed over a
minimum 90-day flow period to assess its stable production
performance. Following the EWT, and subject to the necessary
consents from the Oil and Gas Authority, it is planned to
transition HH-2z and HH-1 seamlessly from test production into
long-term stable oil production. Planning consent for long term oil
production over 25 years was granted by Surrey County Council on 27
September 2019.
UKOG holds a controlling 85.635% interest in the Horse Hill oil
field and surrounding highly prospective PEDL137 and PEDL246
licences, which are operated by UKOG's subsidiary company, Horse
Hill Developments Ltd.
Stephen Sanderson, UKOG's Chief Executive, commented:
"Horse Hill's first optimally placed horizontal is now poised to
enter its next key phase, the eagerly anticipated flow testing
campaign. We remain confident that the 2,500 ft of permeable
Portland sweet-spot reservoir section, 70 times that seen in HH-1,
can deliver significant rates. We look forward to safe and
successful EWT operations over the coming months."
Qualified Person's Statement
Matt Cartwright, UKOG's Commercial Director, who has over 36
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
coring a drilling technique that involves using a doughnut-shaped
drilling bit to capture or "cut" a continuous cylinder-shaped
sample of in-situ rock. The core is captured in
a steel pipe or "core barrel" above the bit. Core
is normally cut in 30 feet lengths, or multiples
of 30 feet, and with a diameter of 3-4.5 inches.
Core is taken in petroleum reservoir rocks for
detailed laboratory analyses of geological, geochemical
petrophysical and geomechanical properties
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 and volumes.
---------------------------------------------------------------
UKOG Licence Interests
The Company has interests in the following UK licences:
Asset Licence UKOG Licence Operator Area (km(2) ) Status
Interest Holder
UKOG IGas Field currently
Avington (GB) Energy temporarily
(1) PEDL070 5% Limited Plc 18.3 shut in
---------------------- ---------- -------------- -------------- -------------- ---------------------
BB-1/1z oil
discovery,
Broadford Loxley-1 gas
Bridge/Loxley/Godley appraisal
Bridge UKOG UKOG well planning
(2, 3, (234) (234) application
8) PEDL234 100% Ltd (4) Ltd (4) 300.0 submitted
---------------------- ---------- -------------- -------------- -------------- ---------------------
Finalising
new site selection
to drill Portland
UKOG and Kimmeridge
A24 (3) PEDL143 67.5% UKOG (7) 91.8 prospects
---------------------- ---------- -------------- -------------- -------------- ---------------------
UKOG IGas
Horndean (GB) Energy Field in stable
(1) PL211 10% Limited Plc 27.3 production
---------------------- ---------- -------------- -------------- -------------- ---------------------
Horse Horse HH-2z well
Hill Hill completion
Horse Hill Developments Developments run prior
(5) PEDL137 85.635% Ltd Ltd 99.3 to EWT
---------------------- ---------- -------------- -------------- -------------- ---------------------
Horse Horse
Hill Hill
Horse Hill Developments Developments
(5) PEDL246 85.635% Ltd Ltd 43.6 As above
---------------------- ---------- -------------- -------------- -------------- ---------------------
Preparing
planning submission
for Arreton-3
oil appraisal
Isle of well and Arreton
Wight (Onshore) South exploration
(2, 3) PEDL331 95% UKOG UKOG 200.0 well
---------------------- ---------- -------------- -------------- -------------- ---------------------
UKOG UKOG
Markwells (GB) (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. Portland and Kimmeridge oil field with productive and
commercially viable zones, HH-2z EWT to commence shortly,
production planning consent granted in September 2019,
appraisal/development drilling campaign completed.
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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