("UKOG" or the "Company")

2019-2020 Strategy and Drilling Plans

UK Oil & Gas PLC (London AIM: UKOG), the largest onshore licence acreage holder in Weald Basin, is pleased to announce that, following the successful production testing and declaration of Portland commercial viability at its Horse Hill oil field (in which the Company holds a 46.735% interest), the Company has now completed a strategic review of its asset portfolio and finalised forward plans to drill up to nine production, appraisal and exploration wells during 2019 and 2020.

The plan's initial focus is to move Horse Hill's ongoing test-based oil production into permanent production by the end of 2019 via two new horizontal production wells. As previously reported, the Portland production target of 720-1,080 barrels of oil per day ("bopd") from the first horizontal well, which has been externally verified as a realistic and viable expectation by Xodus Group Ltd ("Xodus"), is designed to position Horse Hill as the Weald Basin's leading oil producing companies. Subsequent horizontal wells in 2020 are designed to boost gross production to over 2,000 bopd, potentially placing UKOG within the top three oil producing companies in the UK onshore sector.

Next year, the plan aims to convert around 15.6 million barrels ("mmbbl") of the Company's net discovered conventional recoverable resources (or "Contingent Resources") into Reserves. Consequently, the programme includes the drilling and long term testing of an appraisal well in the PEDL331 Arreton oil discovery (UKOG 95% interest), where the majority of the company's currently assessed Contingent Resources lie, together with appraisals in the PEDL234 Godley Bridge gas discovery and Broadford Bridge oil discovery (UKOG 100%). Further Portland and Kimmeridge exploration wells at PEDL331 Arreton South and at a third site in PEDL234 are also planned later in 2020.

A Gantt chart summarising the programme is available on UKOG's website www.ukogplc.com. Further details are summarised below.

PEDL137 Horse Hill Oil Field (UKOG 46.735%)

· The Company's primary 2019 operational goal will be to deliver continuous oil production from Horse Hill via continued extended well testing ("EWT") of Horse Hill-1 ("HH-1") and by the drilling and production testing of two horizontal wells, HH-1z and HH-2, both planned to start in spring 2019. Planning consent and environmental permits are in place and UKOG is fully funded for both wells.

· The first new horizontal well, HH-2, will target the Portland oil field, while the second, HH-1z, a horizontal sidetrack of HH-1, will target the combined 358 ft thick Kimmeridge Limestone 3 ("KL3") and KL4 oil pool, currently on sustained test production from the HH-1 wellbore.

· Utilising the reported flow rates from the current HH-1 vertical wellbore's EWT campaign, both HH-1z and HH-2 each have targets of initial sustained daily horizontal well rates of 720-1,080 bopd. These targets are deemed by the Company's 3^rd party reserve auditor and principal reservoir engineering advisor, Xodus, to be viable and realistic, conforming with the established petroleum engineering benchmark that an optimally placed horizontal well within a reservoir with reasonable vertical permeability can be expected to deliver 2 to 3 times the flow rate of a vertical wellbore from the same reservoir.

· Further horizontal production wells and a water reinjection well are planned to be drilled in early 2020 following the grant of regulatory approvals for permanent oil production, applications for which have been submitted. Permits to cover 20 years of production are expected to be in place by autumn 2019.

Isle of Wight PEDL331 Arreton Main Oil Discovery and Arreton South Exploration (UKOG 95%)

· During winter 2019/20, the Company also aims to convert 14.9 mmbbl of its net unrisked Contingent Resources into Proven and Probable Reserves via the drilling and long term testing of an Arreton-3 ("A-3") appraisal well within the Arreton Main oil discovery.

· As reported in the Company's July 2018 AIM re-admission document (available on the Company's website), the Arreton oil discovery, a geological analogue of the Company's Horse Hill Portland oil field (UKOG net 46.735%), contains three stacked Jurassic oil pools with an aggregate gross P50 oil in place ("OIP") of 127 mmbbl, over four times larger than the 30 mmbbl P50 OIP of the Horse Hill Portland oil field.

· An application to drill, core and test an A-3 pilot hole and horizontal wellbore is planned to be submitted to the Isle of Wight Council in the first quarter of 2019. Shortly afterwards, the Company also intends to submit a further planning application to drill, core and test the geological look-alike Arreton South prospect with operations planned to follow after A-3 testing.

· As per UKOG's 2018 AIM re-admission document, the Arreton South prospect contains a gross Portland P50 OIP of 55 mmbbl, almost twice the Horse Hill Portland field's P50 OIP. The Directors believe that further significant OIP potential, as per Arreton Main, lies within the underlying Jurassic Inferior Oolite reservoir.

PEDL234 Godley Bridge and Broadford Bridge Appraisal and Exploration (UKOG 100%)

· The Company intends to submit a planning application to Surrey County Council by spring 2019, to drill, core and test the Godley Bridge Portland gas discovery and the underlying Kimmeridge. The planned deviated well is located in the centre of the significant 50 km² Portland gas accumulation, which UKOG calculates to contain a gross P50 gas in place ("GIP") of 56 billion cubic ft, of which around half lies within PEDL234. UKOG estimates that expected gas recoveries fall in the range of 50-80% of GIP.

· The Kimmeridge objectives underlying the Portland gas discovery fall within the largest untested Kimmeridge geological structure in the Weald Basin, being approximately twice the size of the Horse Hill structure containing the productive HH-1 Kimmeridge oil field.

· Following completion of the Godley Bridge appraisal well, the Company plans to return to its Broadford Bridge Kimmeridge oil discovery to drill and test a BB-1y Kimmeridge sidetrack.

· A further Kimmeridge exploration well, situated in a third site between Godley Bridge and Broadford Bridge, is also planned in late 2020.

As a result of the strategic review, the Company has also decided that no further investment will be made at its wholly owned PEDL126 Markwells Wood asset. The project's technical and regulatory risks are considered to far outweigh the modest success case potential, particularly when compared with the robust metrics of UKOG's other Kimmeridge and Portland projects. Consequently, the Markwells Wood-1 well has been plugged and abandoned.

Stephen Sanderson, UKOG's Chief Executive, commented:

"If successful, this comprehensive plan aims to add significant value to the Company and shareholders via transforming UKOG from an exploration and appraisal company into a fully-fledged producing oil company by the end of 2019. By attaining the stated production targets, which have been independently verified as viable and realistic by Xodus, the resultant success case daily 2019 production could establish Horse Hill as the largest single oil producing field in the Weald Basin.

In addition, during 2020, two potentially high-impact appraisal wells and production tests at Arreton in the Isle of Wight, Godley Bridge in PEDL234 and the Arreton South exploration well, are planned to test the largest identified undeveloped oil and gas assets in the UK onshore. each contain 3^rd party calculated hydrocarbon in place volumes that are significantly larger than the Horse Hill Portland field's 30 mmbbl, a very significant prize and potential step-change growth opportunity for UKOG. The Directors believe that the Arreton appraisal well alone has a realistic expectation of creating significant value via the addition of around 15 million barrels of Reserves.

The Company's key overall ambitions remain unaltered: to support the drive for increased UK energy security and to create value for shareholders whilst ensuring our operations preserve the natural beauty of the Weald. We aim to continue to be approachable, understanding and cooperative neighbours. Our plans for the next few years will continue to adhere to these solid principles."

Qualified Person's Statement

Rob Wallace, UKOG's principal technical advisor, who has over 40 years of relevant experience in the oil industry, has approved the information contained in this announcement. Mr Wallace is a Chartered Scientist, Chartered Geologist and Fellow of the Geological Society of London, an active member of the American Association of Petroleum Geologists, a member of the Petroleum Exploration Society of Great Britain and a member of the South African Geophysical Society.

For further information, please contact:

UKOG
Stephen Sanderson / Kiran Morzaria	Tel: 01483 900582

WH Ireland (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 / David Bick	Tel: 01483 900582

Glossary

appraisal well	a well designed to determine the lateral extent of a discovered hydrocarbon accumulation
Contingent Resources	those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations, but the applied project(s) are not yet considered mature enough for commercial development due to one or more contingencies. Contingent Resources are further categorized in accordance with the level of certainty associated with the estimates and may be sub-classified based on project maturity and/or characterized by their economic status
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
extended well test	a well test, as per the permission granted by the Oil and Gas Authority, with an aggregate flow period duration over all zones of greater than 96 hours and up to 90 days per zone
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
gas in place ("GIP")	the quantity of gas or petroleum that is estimated to exist in the ground within a naturally occurring accumulation
horizontal well	a well that during drilling is steered so as to 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. A conventional oil field consists of a reservoir in a shape that will trap hydrocarbons and that is covered by an impermeable or sealing rock. Typically, the term implies an economic size.
oil in place ("OIP") or stock tank oil initially in place ("STOIIP")	the quantity of oil or petroleum that is estimated to exist in naturally occurring accumulations.
P50 or best estimate	a 50% probability that a stated volume will be equalled or exceeded
Probable Reserves	or 2P, denotes the best estimate scenario of Reserves
Proven Reserves	or 1P, denotes the low estimate scenario of Reserves
recovery factor	the recoverable volume of petroleum expressed as a percentage of the oil in place or gas in place
recoverable volumes or resources	those quantities of petroleum (i.e. oil or gas) estimated, as of a given date, to be potentially recoverable to surface from known accumulations
Reserves	those quantities of petroleum anticipated to be commercially recoverable by application of development projects to known accumulations from a given date forward under defined conditions. Reserves must further satisfy four criteria: they must be discovered, recoverable, commercial, and remaining (as of the evaluation date) based on the development project(s) applied. Reserves are further categorised in accordance with the level of certainty associated with the estimates (i.e. Proven, Probable and Possible) and may be sub-classified based on project maturity and/or characterised by development and production status
sidetrack	re-entry of a well from the well's surface location with drilling equipment for deviating from the existing well bore to achieve production or well data from an alternative zone or bottom hole location

UKOG Licence Interests

The Company has interests in the following UK onshore licences situated in the south of England:

Asset	Licence	UKOG's Interest	Licence Holder	Operator	Area (km²)	Status
Avington	PEDL070	5%	UKOG (GB) Limited	IGas Energy Plc	18.3	Field currently temporarily shut in
Broadford Bridge ³	PEDL234	100%	UKOG (234) Ltd ⁴	UKOG (234) Ltd ⁴	300.0	BB-1 & 1z oil discovery, planning application approved
Holmwood ³	PEDL143	40%	UKOG	Europa Oil & Gas (Holdings) plc	91.8	Seeking alternate sites to drill Holmwood and other Kimmeridge prospects
Horndean ¹	PL211	10%	UKOG (GB) Limited	IGas Energy Plc	27.3	Field in stable production
Horse Hill ⁵	PEDL137	46.735%	Horse Hill Developments Ltd ^⁶	Horse Hill Developments Ltd ^⁶	99.3	Production tests ongoing, two further appraisal wells scheduled for 2019
Horse Hill ⁵	PEDL246	46.735%	Horse Hill Developments Ltd^⁶	Horse Hill Developments Ltd ^⁶	43.6	As above
Isle of Wight ^{2, 3}	PEDL331	95%	UKOG	UKOG	200.0	Preparing planning submission for Arreton-3 oil appraisal well and Arreton South exploration well
Markwells Wood	PEDL126	100%	UKOG (GB) Limited	UKOG (GB) Limited	11.2	MW-1 site restoration in 2019

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, two further wells HH-1z and HH-2 scheduled in Q2 2019, development underway subject to grant of planning consent, expected in Q3 2019.

6. UKOG has a direct 71.9% interest in HHDL, which has a 65% interest in PEDL137 and PEDL246.

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