UK Oil & Gas Investments PLC
("UKOG" or the "Company")
Oil Seeps from Kimmeridge Limestone Core Samples at Broadford Bridge-1 Kimmeridge Exploration Well, PEDL234 Licence, Weald Basin, UK
UK Oil & Gas Investments PLC (London AIM and NEX: UKOG) is delighted to announce that mobile light oil has been observed seeping from open natural fractures in Kimmeridge Limestone 4 ("KL4") core samples at its 100%-owned Broadford Bridge-1 ("BB-1") exploration well. The KL4 samples, at a measured depth of around 4080 feet, exhibit a strong oil odour plus the rock matrix is oil saturated and heavily oil stained. Wet gas readings also increased significantly at the top of the KL4. Both the KL4 and overlying shales exhibit a high degree of natural fracturing. Coring operations continue through KL4.
The well remains on schedule and under budget.
The 160 ft of core taken to date in the Upper Kimmeridge Shales and Limestones will be transported to Aberdeen today for initial rock sampling at the weekend, before extensive geological, petrophysical and geo-mechanical analyses will be carried out by COREX and Premier Oilfield Laboratories in the UK and USA.
Stephen Sanderson, UKOG's Executive Chairman commented:
"I am privileged and excited to have seen, smelt and touched the oil in the KL4 samples today, alongside UKOG's management and operations team. This is a significant and positive result at such an early stage in the well.
Whilst this is still early days, the presence of mobile oil within a Kimmeridge geological feature that has no structural oil trapping configuration, demonstrates that both BB-1 and Horse Hill-1 could be part of the same Kimmeridge continuous oil deposit. This oil deposit may therefore extend over 30 km from north to south across the Weald Basin.
We will now continue our coring and drilling programme and then move to an extended flow testing operation upon the grant of the remaining necessary regulatory permissions."
About Coring
Coring is 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 core bit. Core is normally cut in 30 feet lengths, or multiples of 30 feet, and in the case of BB-1 with a diameter of 4 inches. Core is taken in petroleum reservoir rocks for detailed laboratory analyses of petrophysical and geomechanical parameters and of any hydrocarbons contained within the rock.
About BB-1
BB-1 is located near Billingshurst, West Sussex, within the 300 km² PEDL234 licence, in which the Company has a 100% interest via its ownership of the licence's operator, Kimmeridge Oil & Gas Limited. The well, an exploration step-out, is designed to penetrate four naturally fractured Kimmeridge Limestone units (KL1-KL4), the uppermost two units of which flowed at record rates in the Horse Hill-1 discovery near Gatwick Airport.
Importantly, to prove that the Kimmeridge Limestones lie within an extensive continuous oil deposit the BB-1 well was deliberately designed to test a feature with no structural closure at the KL1-KL4 horizons.
The forward plan is to continue to core the KL4 and KL3 target zones and then continue to drill 8 ½" diameter hole at a constant inclination of 54 degrees to vertical. Further core may be taken in KL2. The planned overall horizontal deviation of the well is approximately 1 km. The Kimmeridge Limestones are expected to be encountered at a drilled depth of approximately 1250-1700 metres, which equates to around 950-1200 metres vertically below surface.
Qualified Person's Statement
Stephen Sanderson, UKOG's Executive Chairman, who has over 35 years of relevant experience in the oil industry, has approved the information contained in this announcement. Mr Sanderson is a Fellow of the Geological Society of London and is an active member of the American Association of Petroleum Geologists.
For further information, please contact:
UK Oil & Gas Investments PLC
Stephen Sanderson / Kiran Morzaria Tel: 01483 243450
WH Ireland (Nominated Adviser and Broker)
James Joyce / James Bavister Tel: 020 7220 1666
Cenkos Securities PLC (Joint Broker)
Nick Tulloch / Neil McDonald Tel: 0131 220 6939
Square 1 Consulting (Public Relations)
Brian Alexander / David Bick Tel: 01483 243450 / 020 7929 5599
Glossary:
|
casing |
heavy gauge steel tubing designed to line the wall of a well. The casing provides a safe controlled space in which the drill pipe and bit can operate in isolation from conditions in overlying rock units. The steel tubing is bonded to the surrounding rock by impermeable concrete, known as "cement" |
|
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 30 feet lengths, or multiples of 30 feet, 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 |
|
continuous oil deposit or resource deposit |
a petroleum accumulation that is pervasive throughout a large area, which is not significantly affected by hydrodynamic influences and is not trapped by structural or stratigraphic geological conditions. The petroleum in these accumulations is normally found within the rocks where the petroleum is generated, i.e. within rocks lying within petroleum source rocks, normally organic rich shales such as the Kimmeridge Clay Formation |
|
discovery |
a discovery is a petroleum accumulation for which one or several exploratory wells have established through testing, sampling and/or logging the existence of a significant quantity of potentially moveable hydrocarbons |
|
limestone |
a sedimentary rock predominantly composed of calcite (a crystalline mineral form of calcium carbonate) of organic, chemical or detrital origin. Minor amounts of dolomite, chert and clay are common in limestones. Chalk is a form of fine-grained limestone |
|
naturally fractured reservoir |
a fractured reservoir contains open and usually connected cracks or fissures within the rock matrix; fractures can enhance permeability of rocks greatly by connecting pore-spaces together; naturally fractured reservoirs have been created over geological time by nature, not man-made via hydraulic fracturing |
|
step-out well |
a well specifically designed to determine the lateral extent of a discovered hydrocarbon accumulation or play |
|
wet gas |
natural gas, predominantly consisting of methane (C1), ethane (C2) and propane (C3) but also containing the longer molecular chain natural gases butane and iso-butane (C4), pentane and iso-pentane (C5). The C4 and C5 gases are created during oil-generation within a petroleum source rock unit when oil is thermally cracked. At Horse Hill these natural gases lie in solution with the oil in the KL3 and KL4 Kimmeridge Limestone reservoirs (i.e. solution or associated gas and not as a separate free-gas phase). |
UKOG Licence Interests
The Company has interests in the following ten UK licences:
|
Asset |
Licence |
UKOG's Interest |
Licence Holder |
Operator |
Area (km2) |
Status |
|
Avington 1 |
PEDL070 |
5% |
UKOG (GB) Limited |
IGas Energy Plc |
18.3 |
Field in stable production |
|
Baxters Copse 2 |
PEDL233 |
50% |
UKOG Weald Limited |
IGas Energy Plc |
89.6 |
Appraisal/development well planned; licence extended to 2018 |
|
Broadford Bridge 3 |
PEDL234 |
100% |
Kimmeridge Oil & Gas Limited 4 |
Kimmeridge Oil & Gas Limited 4 |
300.0 |
BB-1 drilling underway |
|
Holmwood 3 |
PEDL143 |
30% |
UKOG |
Europa Oil & Gas (Holdings) plc |
91.8 |
Holmwood-1 exploration well planned in 2017 |
|
Horndean 1 |
PL211 |
10% |
UKOG (GB) Limited |
IGas Energy Plc |
27.3 |
Field in stable production |
|
Horse Hill 5 |
PEDL137 |
31.2% |
Horse Hill Developments Ltd ⁶ |
Horse Hill Developments Ltd ⁶ |
99.3 |
Submitted planning application for long term production tests and drilling of two wells |
|
Horse Hill 5 |
PEDL246 |
31.2% |
Horse Hill Developments Ltd⁶ |
Horse Hill Developments Ltd ⁶ |
43.6 |
As above |
|
Isle of Wight (Offshore) 3 |
P1916 |
100% |
UKOG Solent Limited |
UKOG Solent Limited |
46.7 |
Preparing drilling planning submission |
|
Isle of Wight (Onshore) 2, 3 |
PEDL331 |
65% |
UKOG |
TBA |
200.0 |
Preparing drilling planning submission |
|
Markwells Wood 2 |
PEDL126 |
100% |
UKOG (GB) Limited |
UKOG (GB) Limited |
11.2 |
Submitted planning application for appraisal and field development |
Notes:
1. Oil field currently in production.
2. Oil discovery pending development and/or appraisal drilling.
3. Exploration asset with drillable prospects and leads. Contains the extension of the Godley Bridge Portland gas discovery and the site of the forthcoming Broadford Bridge-1 well.
4. UKOG has a 100% interest in Kimmeridge Oil & Gas Limited, which has a 100% interest in PEDL234.
5. Oil discovery with recently completed flow testing.
6. UKOG has a direct 48% interest in HHDL, which has a 65% interest in PEDL137 and PEDL246.