Regulatory Story
Go to market news section View chart   Print
RNS
UK Oil & Gas Investments PLC  -  UKOG   

UKOG buys Angus Energy's stake in Horse Hill -1

Released 07:00 18-Apr-2016

RNS Number : 4528V
UK Oil & Gas Investments PLC
18 April 2016
 

UK Oil & Gas Investments PLC

("UKOG" or the "Company")

 

UKOG buys Angus Energy's stake in UK's Horse Hill -1 Oil Discovery

 

UK Oil & Gas Investments PLC (London AIM and ISDX: UKOG) announces that it has acquired all of Angus Energy Holdings UK Limited's ("Angus") remaining 7.8% interest in onshore Weald Basin licences PEDL137 and PEDL246 ("the Licences").

 

The Company has significantly increased its net working interest in the Licences from 19.968% to 27.3%. The Licences, covering an area of 55 square miles, contain the new Horse Hill-1 ("HH-1") Portland sandstone and Kimmeridge Limestone oil discoveries north of Gatwick Airport and which, as previously reported on 21 March, flow tested at a significant "North Sea-like" commercial aggregate stable dry oil rate of 1688 barrels of oil per day.

 

Transaction Summary

For a total Consideration of £1.8 million, the Company will receive Angus' 7.8% beneficial interest in the Licences via the purchase of Angus' remaining 12% shareholding in Horse Hill Developments Limited ("HHDL"). The Consideration, with an effective date of 15 April 2016, is comprised of £1 million in cash and £0.8 million in the form of 43,886,116 UKOG ordinary shares. Furthermore, £200,000 of the cash element will be paid directly by Angus to the Licence Operator, HHDL, to reconcile cash calls for the now completed HH-1 flow test operations. The transaction requires no further regulatory approvals.

 

Application will be made for these New Ordinary Shares to be admitted to trading on AIM and it is anticipated that trading in such shares will commence on or around 22 April 2016.

 

Following Admission, the Company's enlarged issued share capital will comprise 2,087,336,802 ordinary shares. The Company does not hold any shares in treasury. This figure of 2,087,336,802 ordinary shares may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA's Disclosure and Transparency Rules.

 

HHDL and the Company's Interest in the Licences

HHDL is a special purpose vehicle which owns a 65% working interest and operatorship of the Licences. The Company now holds a 42% beneficial shareholding in HHDL which equates to a 27.3% net working interest in the Licences. The remaining 35% interest in the Licences is owned by Magellan Petroleum UK Limited.

HH-1 Discovery Well Location and Licence Location

The HH-1 well is located within onshore exploration Licence PEDL137, on the northern side of the Weald Basin near Gatwick Airport. PEDL246 lies adjacent to and immediately to the East of PEDL137. UKOG owns a 27.3% interest in the Licences.

Stephen Sanderson, UKOG's Executive Chairman, commented:

"Following the recent highly significant HH-1 flow test results this acquisition is an important and entirely logical step for the Company. It provides us with a far more material interest in the exciting HH-1 Portland and Kimmeridge limestone oil discovery, and importantly, is part of our ongoing strategy to consolidate and expand our licence position in the new and potentially significant Kimmeridge Limestone oil province.

With our increased interest in Horse Hill we will be looking hard at translating the commercial flow rates seen from the Kimmeridge and Portland flow tests at Horse Hill - 1 towards commercial production. To this end, further long-term production tests of all zones are now planned by the Horse Hill Licence holders within the next year, subject to regulatory approvals. These tests are planned to be followed, by a number of horizontal Kimmeridge Limestone side-track wells, 3D seismic and a new stand-alone Portland appraisal/development well.

The next year to 18 months will be an exciting journey for both the Company and the new Kimmeridge Limestone oil play. We know HHDL are committed to putting the Horse Hill Portland and Kimmeridge zones in to long term production as soon as practicably possible."

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 / Jason Berry                                                                             Tel: 020 7440 0640

 

WH Ireland (Nominated Adviser and Broker)

James Joyce / Mark Leonard                                                                                      Tel: 020 7220 1666

 

Square 1 Consulting (Public Relations)

David Bick / Brian Alexander                                                                                      Tel: 020 7929 5599

 

Glossary

 

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

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

horizontal well

a well that during drilling is steered so as to be at or close to 90 degrees from the vertical to follow a particular geological stratum or reservoir unit

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. The Kimmeridge Limestones are effectively chalks being comprised of the remains of calcareous planktonic algae

moveable oil

oil that can flow or be pumped to the surface

oil in the ground

or oil in place, the quantity of oil or petroleum that is estimated to exist originally in naturally occurring accumulations in the ground before any extraction or production.

 

Notes to Editors:

The Company has interests in the following 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

Reviewing economics of appraisal/ development well.


Brockham 1

PL234

3.6%

Angus Energy 5

Angus Energy 5

8.9

Drilling of sidetrack well being considered.


Holmwood 3

PEDL143

30%

UKOG

Europa Oil & Gas (Holdings) plc

91.8

H-1 exploration commitment well planned.


Horndean 1

PL211

10%

UKOG (GB) Limited

IGas Energy Plc

27.3

Field in stable production.


Horse Hill 4

PEDL137

27.3%

Horse Hill Developments Ltd 6

Horse Hill Developments Ltd 6

99.3

Extended flow testing of HH-1.


Horse Hill 4

PEDL246

27.3%

Horse Hill Developments Ltd 6

Horse Hill Developments Ltd 6

43.6

Extended flow testing of HH-1.


Isle of Wight (Offshore) 3

P1916

77.5%

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.


Lidsey 1

PL241

4.2%

Angus Energy 5

Angus Energy 5

5.3

Drilling of infill well being considered.


Markwells Wood 2

PEDL126

100%

UKOG (GB) Limited

UKOG (GB) Limited

11.2

Compiling Field Development Plan.


 

Notes:

1. Oil field currently in production.

2. Oil discovery pending development and/or appraisal drilling.

3. Exploration asset with drillable prospects and leads.

4. Oil discovery with recently completed flow testing.

5. UKOG has a 6% interest in Angus Energy, which has a 70% interest in Lidsey and a 60% interest in Brockham.

6. UKOG has a direct 30% interest in HHDL, plus an indirect 0.72% interest via Angus Energy; HHDL has a 65% interest in PEDL137 and PEDL246.


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
ACQGMGMDFNZGVZZ
Close


London Stock Exchange plc is not responsible for and does not check content on this Website. Website users are responsible for checking content. Any news item (including any prospectus) which is addressed solely to the persons and countries specified therein should not be relied upon other than by such persons and/or outside the specified countries. Terms and conditions, including restrictions on use and distribution apply.

 


UKOG buys Angus Energy's stake in Horse Hill -1 - RNS