UK Oil and Gas

UK Oil and Gas PLC, commonly known as UKOG, is a United Kingdom oil and gas exploration and production company whose activities are concentrated on onshore resources. The company is listed on the London Stock Exchange’s Alternative Investment Market under the symbol UKOG.L. Its principal operating focus has been the Weald Basin in southern England, where it has held interests in exploration, appraisal, development and production assets. The company adopted its present name on 4 December 2013 and changed its trading symbol to UKOG the following day. Its public profile rose substantially in 2016 after flow testing at the Horse Hill-1 well, located north of Gatwick Airport. Testing from three geological zones produced a reported combined flow rate of 1,688 barrels of oil per day, which was described as the highest flow rate achieved by an onshore UK well at that time. Horse Hill consequently became the company’s flagship project and a central part of its strategy for proving the commercial potential of southern England’s onshore petroleum resources. UKOG’s portfolio has also included the Broadford Bridge prospect, where the BB-1 well and BB-1z sidetrack were drilled in 2017. That programme was less successful than Horse Hill. Problems associated with blocked fractures in the well bore restricted flow performance, and the resulting rates were regarded as sub-commercial in the referenced material. The contrast between the two projects illustrates the technical and commercial uncertainty associated with developing tight or fractured onshore reservoirs. At Horse Hill, the company pursued extended well testing to assess whether production from the Portland sandstone and Kimmeridge limestone could be commercially sustained. The Portland interval was described as commercially viable, and planning permission was reported for five additional wells. UKOG stated a target of approximately 3,200 barrels of oil per day for the expanded site; if achieved, that level would have made Horse Hill one of the largest land-based oil production sites in the United Kingdom. UKOG’s wider UK portfolio has included interests in seven oil and gas assets in southern England, comprising exploration licences and interests in mature producing fields. In the Weald Basin, named assets include Horse Hill, Broadford Bridge, the Holmwood prospect, Arreton on the Isle of Wight and Markwells Wood. UKOG has also held minority interests in the Horndean and Avington producing fields, which are operated by IGas Energy. The company’s positioning is therefore that of an independent onshore exploration and development specialist rather than an integrated international oil major. Its business model depends on geological appraisal, regulatory approvals, well testing, field development and the commercialisation of discovered hydrocarbons through available infrastructure.

UK Oil and Gas is a UK-listed independent oil and gas exploration and production company focused on onshore petroleum resources. Its activities have centered on southern England, especially the Weald Basin, where the company has participated in exploration, appraisal, well testing and field development. It has also held minority interests in mature producing fields and exploration prospects elsewhere in the region. The company assumed the UK Oil and Gas name on 4 December 2013 and changed its trading symbol to UKOG the next day. The rebranding established the name under which the company became associated with the development of domestic onshore oil and gas assets. Unlike major integrated energy companies, UKOG’s business has been concentrated on a relatively small portfolio of licences and interests, with value dependent on the successful appraisal and commercial development of individual wells and fields. Horse Hill became the company’s most prominent project. The Horse Hill-1 well, situated approximately three miles north of Gatwick Airport, underwent flow testing in 2016. Testing across three zones generated a combined reported flow rate of 1,688 barrels of oil per day. The result was widely reported as the highest flow rate from an onshore UK well at that point and brought national attention to both UKOG and the wider question of onshore petroleum development in southern England. The company subsequently pursued further evaluation of Horse Hill through extended well testing. The purpose was to establish whether the well could support commercial production from both the Portland sandstone and the Kimmeridge limestone. The Portland interval was reported as commercially viable, and planning permission was granted for five additional wells at the site. UKOG identified a possible production objective of about 3,200 barrels per day for the expanded development. This was a target rather than a reported achieved production level. UKOG’s second major Weald Basin project referenced in the available material was Broadford Bridge. The BB-1 well and its BB-1z sidetrack were drilled in 2017. The results were less encouraging than at Horse Hill: blocked fractures in the well bore created operational and flow difficulties, and the resulting flow rates were considered sub-commercial at the time described. The project highlighted the geological, engineering and economic risks involved in producing oil from fractured or low-permeability formations. The company’s broader southern England portfolio has included interests in seven oil and gas assets. In the Weald Basin, these have included Horse Hill, Broadford Bridge, the Holmwood prospect, Arreton on the Isle of Wight and Markwells Wood. UKOG has also held a 10 percent interest in the Horndean field and a 5 percent interest in the Avington field, both operated by IGas Energy according to the referenced material. These interests combine prospective exploration positions with exposure to ageing production assets. UKOG’s operating approach emphasizes the use of existing infrastructure where possible, staged appraisal and testing, and the progression of discoveries through planning and development approvals. Its commercial prospects are closely linked to well performance, recoverable volumes, production costs, regulatory decisions and public acceptance of onshore oil and gas activity. The available reference material does not establish a complete current account of its asset ownership, production levels, executive team or financial condition, so those details are left unspecified here.

• 2017

  Broadford Bridge drilling programme

  [1]UK Oil and Gasen.wikipedia.org

  The BB-1 well and BB-1z sidetrack were drilled at Broadford Bridge, but well-bore complications and blocked fractures limited flow performance.

• 2016

  Horse Hill-1 flow testing

  [1]UK Oil and Gasen.wikipedia.org

  Flow testing from three zones at Horse Hill-1 produced a reported combined rate of 1,688 barrels per day, making the well a prominent UK onshore oil project.

• 2013

  Adoption of the UK Oil and Gas name

  [1]UK Oil and Gasen.wikipedia.org

  The company adopted its present corporate name on 4 December 2013 and changed its trading symbol to UKOG on the following day.

• Horse Hill development planning

  [1]UK Oil and Gasen.wikipedia.org

  The Portland interval at Horse Hill was reported as commercially viable, while planning permission was granted for five additional wells and a stated development target of approximately 3,200 barrels per day.

An independent UK onshore oil and gas explorer and developer focused on appraising and commercialising petroleum resources in southern England, particularly through the Weald Basin and existing infrastructure.

• Hydrocarbon production

  Crude oil

  Crude oil is UKOG’s principal referenced commercial output and development objective. The company has focused on discovering, appraising and producing oil from onshore formations in southern England, including the Portland sandstone and Kimmeridge limestone at Horse Hill. The reported Horse Hill flow-test result demonstrated production potential, but test rates and development targets should not be treated as equivalent to sustained commercial production.

• Hydrocarbon production

  Natural gas

  Natural gas is included within UKOG’s oil and gas exploration remit. The available material identifies the company as an oil and gas exploration and production business and lists gas among its typical hydrocarbons, but it does not provide sufficient detail on specific gas fields, production volumes or current gas sales.

• 2016

  Horse Hill flow-testing programmeProduct launch

  Background

  The Horse Hill-1 well required appraisal to determine the production potential of several geological zones.

  Action taken

  UKOG carried out flow testing across three zones at the well.

  Aftermath

  The reported combined flow rate of 1,688 barrels per day elevated Horse Hill’s profile and supported further commercial evaluation.

  Source

• 2013

  Corporate name and ticker changeStrategy

  Background

  The company changed its corporate name to UK Oil and Gas as it operated in the UK oil and gas exploration sector.

  Action taken

  It adopted the UK Oil and Gas name on 4 December and changed its market trading symbol to UKOG on 5 December.

  Aftermath

  The UKOG identity became the company’s public market and operating brand.

  Source

• Extended testing and staged development at Horse HillStrategy

  Background

  The company needed to determine whether production from the Portland sandstone and Kimmeridge limestone could be commercially sustained.

  Action taken

  UKOG pursued extended well testing and advanced plans for five additional wells after the Portland interval was described as commercially viable.

  Aftermath

  The company stated a possible development objective of approximately 3,200 barrels of oil per day, subject to successful development and production performance.

  Source

1. 1UK Oil and Gasen.wikipedia.org
2. 2UK Oil and Gas PLC corporate websiteukogplc.com