The Horse Hill site is located in the Weald basin in Surrey, not far from Gatwick airport.
There are around a dozen oil sites across the Weald, a region spanning Kent, Sussex, Surrey and Hampshire, but projects have been modest in size.
Today’s news that 100bln barrels could be beneath Horse Hill is a game changer and probably the largest onshore UK discovery in the last 30 years.
It’s also a big deal for the clutch of AIM-listed companies who clubbed together at the start of 2014 to fund a drill programme at the site.
UK Oil and Gas (LON:UKOG) has a 20% interest in Horse Hill Development Ltd, HHDL for short, a special purpose company that holds rights a 65% stake in the Horse Hill project.
Another player, Regency Mines, sold its 5% stake in HHDL last month but still owns 2.35% of Alba, so it continues to carry an indirect interest in the success of the project.
Outside of HHDL, Magellan Petroleum, owns the remaining 35%.
According to UKOG chairman David Lenigas all HHDL ‘ops’ are run from UKOG and Solo Oil, and they have been for a while.
Shares in the quoted companies have rocketed today; so what has actually been found?
US oilfield analytics firm Nutech, working alongside UKOG and Solo, discovered the new resource in Upper Jurassic Kimmeridge formation at a depth of between 2,500ft (762m) and 3,000ft (914m).
Kimmeridge was always the “blue-sky” play after the well understood Portland discovery – where oil estimates of 5.7mln and 12mln barrels have already been made.
Based on what’s been found at Kimmeridge though, UKOG reckons it’s looking at between 50 and 100 billion barrels of oil in place in the ground.
How commercial the find is still needs to be determined, but UKOG chief Stephen Sanderson said recovery estimates in other similar formations around the world were between 3% and 15% of oil in place.
He is confident though, and added that by 2030 it could mean that 10%-to-30% of the UK's oil demand comes from within the Weald area.
http://ift.tt/1a8Vnwq @MasterMetals MasterMetals Blog