UK Oil & Gas secures two onshore licence extensions

UK Oil & Gas (UKOG) has received two-year extensions to the initial terms of two licences in southern England.

The licences included the company’s operated PEDL331 on the Isle of Wight, which features the Arreton oil discovery, and PEDL143 prospect in northern Weald.

The PEDL 331 licence has been extended by the UK Oil & Gas Authority until 20 July 2023 while the PEDL143 licence will now expire on 30 September 2022

UKOG holds a 95% interest in the PDEL 331 Arreton licence, which is estimated to hold 14.9 million barrels of available resources.

The drilling of the Arreton-3/3z appraisal well and expanded flow test is expected to start in late-2020, subject to regulatory approvals.

The PEDL 143 licence is estimated to hold 5.6 million barrels of oil equivalent. UKOG holds a 67.5% interest and is the operator of this field.

The PEDL143 licence is situated west of the UKOG Horse Hill licence, which is estimated to be a major source of Portland and Kimmeridge oil prospect.  It is said to be a geological duplicate of the Horse Hill oil field.

UKOG chief executive Stephen Sanderson said: “These extensions on key appraisal and exploration assets will permit UKOG to carry out its stated multi-well drilling campaign within the initial term of both licences.

“The identification of a further large undrilled Portland structure on trend with the Arreton oil discovery makes the Isle of Wight asset even more attractive than before and fully justifies our increase in ownership of PEDL331.”

The UKOG subsurface team has recently discovered an undrilled anticlinal area, Arreton East Prospect, which is estimated to be larger than the Arreton Oil discovery and Arreton South combined.

In the company’s readmission document last year, it was estimated that the Arreton North and South prospects may aggregate P50 Portland oil in place of 77.2Mmbbl which is more than twice that of the Horse Hill Portland Oil field.