Confidence is building at the Horse Hill-1 oil discovery in the U.K.’s Weald Basin as new petrophysical analysis shows the discovery’s total oil in place (OIP) per square mile in the Upper Portland pay zone is nearly three times previous estimates.

UK Oil and Gas Investments (UKOG) and partner Solo Oil shared news July 19 of analysis, conducted by Nutech, which integrated results of the Horse Hill-1 flow test, boosting the total OIP from 7.7 million barrels (MMbbl) per square mile to 22.9 MMbbl per square mile.

The higher figure comes a few months after the well, located near England’s Gatwick Airport, flowed at a stable dry oil rate of 323 bbl/d over an 8.5-hour period during the final Portland sandstone flow test. The rate was nearly double the previously reported rate of 168 bbl/d thanks in part to use of a larger pump.

“Nutech’s report notes that the production of dry oil from the Portland Sandstone, with little or no observed water production, required a reassessment of the pre-flow test petrophysical model,” Solo Oil said in a statement. “Prior to the flow test, interpretations suggested that water would likely be produced along with oil, as is seen in Portland reservoirs in nearby producing oil fields. The revised model fully incorporates the well test observations and measurements.”

UKOG cautioned, however, that the OIP per square mile should not be considered as recoverable resources, contingent or prospect resources or reserves.

“The record breaking flow test results and revised Nutech analysis gives us key new technical insight into the oil bearing Portland reservoir,” Stephen Sanderson, UKOG’s executive chairman, said in a news release. “More importantly than the simple increase in Portland oil in the ground, these learnings have significant positive implications for potential recovery factors and for future commercial viability.”

The news was delivered during a challenging time for the U.K. oil and gas sector. The region is adjusting to changes following the U.K.’s decision to leave the European Union as hundreds of North Sea workers prepare to strike over wage disputes and as the global downturn continues with less spending, particularly for exploration.

But the Horse Hill-1 flow tests have reinforced views on the potential of the reservoir’s Kimmeridge limestones and the overlying Portland sandstone. Engineering studies are underway to determine the potential impact a horizontal sidetrack well could have on possible flow rates.

With the new analysis and previous work conducted by Xodus, developers are now pushing forward at Horse Hill, which is operated by Horse Hill Development Ltd., a consortium of eight companies led by UK Oil and Gas with a 42% stake.

Plans are to pursue the permission needed from the Surry County Council and the Environment Agency to begin an appraisal program that will include production flow testing, two appraisal/development wells and 3-D seismic acquisition. Barton Willmore, a planning and environmental assessment consultant, has been hired to prepare and submit the planning application and other necessary regulatory work.

“The granting of these permissions is the next key step to enable us to move the Horse Hill Portland and Kimmeridge projects forwards towards early monetization,” Sanderson said. “We look forward to the conclusion of the regulatory consent cycle and eagerly await the start of planned long term flow testing.”

Velda Addison can be reached at vaddison@hartenergy.com.

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