UK Oil & Gas Investments (UKOG) has given up on its license offshore Isle of Wight to focus on adjacent onshore oil discovery and exploration prospects.
UKOG has informed UK’s oil and gas regulator, the Oil and Gas Authority (OGA), that it will not seek any further extension to the offshore P1916 Licence in order to focus upon appraising the onshore PEDL331 Arreton oil discovery and satellite exploration prospects, according to UKOG’s statement on Wednesday.
Consequently, the P1916 Licence, in which the company held a 100% interest, has now lapsed. In the company’s view the offshore license’s low geological prospectivity, high environmental sensitivity and consequential high associated drilling costs merited no further commitment of UKOG’s financial or technical resources. No remaining P1916 Licence obligations remain.
As previously reported in January 2016, Xodus’ independent report allocated a gross mean aggregated oil in place of 227 million barrels (MMbbl) to the onshore Arreton oil discovery and associated Arreton South and North satellite prospects. Recoverable gross 2C Contingent Resources were calculated as 15.7 MMbbl, with 10.2 MMbbl net to UKOG. The company holds a 65% interest in PEDL331.
Arreton site selection and regulatory permitting activities are now underway to permit a planned appraisal drilling campaign in the first half of 2019, the company said.
Stephen Sanderson, UKOG’s Executive Chairman, commented: “The Arreton discovery on the Isle of Wight’s remains a key element of the company’s 2018 and 2019 growth strategy and plans. We look forward to working with our partners towards a successful 2019 appraisal drilling campaign.”