– adds Solo chief executive comment –
Shares in UK Oil & Gas and Solo Oil rocketed higher on the discovery of billions of barrels of oil at the Horse Hill prospect near Gatwick airport.
“It’s not like we need a giant North Sea rig,” he told Proactive, adding there were a number of other fields nearby already in production.
He also played down the suggestion that fracking would be required to extract the oil.
It did not look like it will be necessary as these were naturally fractured limestone reservoirs that don’t need fracking to flow, he said, adding the discovery was a combination on modern analytical techniques and new well samples.
Flow testing is planned for later this year, he added, and if that goes well, a development plan will be prepared next year with first production to get underway in 2017.
UKOG’s chief executive Stephen Sanderson told the BBC that the site near Gatwick may become a world class resource after estimates of oil in place at the site were upgraded to 158mln barrels per square mile, excluding a discovery already made at Portland.
“Based on what we’ve found here, we’re looking at between 50 and 100 billion barrels of oil in place in the ground. By 2030 we could produce 10%-to-30% of the UK’s oil demand from within the Weald area,” Sanderson said.
The new oil resource was discovered in the Jurassic layer by US oilfield analytics firm Nutech working alongside UKOG and Solo.
It identified the oil in 653 feet of net pay, of which over 70% or 114mln barrels is in the Upper Jurassic Kimmeridge interbedded limestone and mudstone sequence.
“Drilling the deepest well in the basin in 30 years, together with the ability to use concepts, techniques and technology unavailable in the 1980s, has provided new cutting-edge data and interpretations to comprehensively change the understanding of the area’s potential oil resources,” said Sanderson.
“As a result, we believe that, in addition to the Portland Sandstone oil discovery, the Horse Hill well has discovered a possible world class potential resource in what is interpreted to be a new Upper Jurassic ‘hybrid play’.
“Nutech’s results combined with our extensive geochemical analyses strongly indicates that the company’s Horse Hill licences lie within the likely sweet spot of the identified “Weald hybrid play,” he added.
How commercial the find is still needs to be determined, but Sanderson said recovery estimates in other similar formations around the world were between 3% and 15% of Oil in Place.
At the Portland discovery, there is an estimated additional 5.7 to 12mln barrels of oil.
Further analysis work is ongoing by Nutech, UKOG and Solo Oil, which has a 10% stake in the Horse Hill consortium that owns 65% of the licence.
The results of the estimated oil within the licence will be reported when completed.
Final assessments of the Upper Portland Sandstone, and the Oxford and Lias sections are in progress, with further results expected shortly, UKOG said.
Analysts said the big ‘if’ is how much of the 100bn is recoverable and key to this would be the flow rates, how many wells would be required and how much they will cost.
from MasterMetals http://ift.tt/1Jsw4lD