‘Outstanding’ oil flow produced by Gatwick Gusher
By Paul Homewood
News from the failed Independent, which will be guaranteed to make Geoffrey Lean’s hair stand on end!
The Gatwick Gusher has produced the highest flow rates of any onshore wildcat well in the UK, matching the kind of levels normally seen in the North Sea, its majority owner UK Oil & Gas said.
The exploration company said it had completed its final test at Horse Hill, just north of Gatwick Airport, and that the aggregate flow from three layers of oil-bearing rock had been 1,688 barrels per day.
“The flow test results are outstanding, demonstrating North Sea-like oil rates from an onshore well,” said UKOG executive chairman Steve Sanderson. “This simple vertical well has achieved an impressive aggregate oil rate equivalent to 8.5 per cent of total UK onshore daily oil production.
“We are delighted, therefore, that this discovery has the serious prospect of being a meaningful addition to the UK’s own supply of oil in a period where North Sea production is declining more rapidly than expected.”
He said that the final tests, from the Portland sandstone level, had actually been limited because they hit the well pump’s maximum capacity limit. He also said that planned future drilling horizontally rather than just vertically could also significantly increase the rate of flow.
UKOG said it had commissioned Nutech and Xodus, oil engineering consultants, to provide estimates of how much oil may be recoverable from the reservoirs. Previous studies have suggested that there are reserves of around 10 billion barrels under Horse Hill.
Mr Sanderson said: “These results cause us to rethink and recalibrate many prior geological assumptions. Nutech will now reinvestigate the presence of significant natural fracturing and oil in place figures for both the Portland and Kimmeridge units given that all flow periods produced 100 per cent dry oil.”
During the tests the Horse Hill well delivered 1,940 barrels of so-called “light sweet oil” to Esso’s Fawley refinery.
Shares in UKOG and its associated investors in Horse Hill, Solo Oil, Alba Mineral Resources, Doriemus, Evocutis, Regency Mines and Stellar Resources, mainly dropped slightly on the news. UKOG shares, which hit 4.75p at the peak of Gatwick Gusher excitement a year ago, were 2.22p yesterday. Neil Ritson, chairman of Solo Oil, said: “This is truly a game-changing well for exploration in the Weald Basin and provides considerable encouragement that a significant commercial accumulation has been found in the Portland sandstones and that a potentially massive Kimmeridge limestone play has been revealed.”
One point that cannot be overstated is the effect on the UK’s balance of payments.
Hardly a week goes by without dire warnings about our worsening balance of trade. Yet our dumb politicians want to make matters worse by building more interconnectors to import energy from abroad.
Meanwhile, UPI report that US shale gas output has hit a record high:
DENVER, March 23 (UPI) — U.S. natural gas production is on the rise, with some reserve areas in the country’s Northeast getting more output from fewer wells, an industry report found.
"The natural gas production record achieved in February is largely attributed to the Northeast, which also is still helping offset the declines seen in other major U.S. basins," Sami Yahya, a Platts Bentek energy analyst, said in an emailed statement.
Platts Bentek, a forecasting unity for energy reporting service Platts, reported February natural gas production in the Lower 48 U.S. states was 73.3 billion cubic feet per day, up nearly 2 percent from January.
According to its estimates, the February gas output level is the highest since it started keeping records in 2005.
The increase in production comes as most energy companies are scaling back on investments in the upstream sector in response to lower crude oil prices. Rig counts, which serve as a barometer for the health of the industry, have been in steady decline.
Yahya said for wells in the Northeast, the rig count has moved lower at least since November. A report last year from the U.S. Energy Information Administration found net natural gas production from new wells drilled into U.S. shale reserves is not enough to counter the expected decline from legacy wells.
At the time, EIA found only the Utica shale basin in Ohio was expected to post an increase in short-term production of the seven shale reserve areas it measured.
Platts, in its latest report, found the Utica shale was still resilient when weighed against other areas.
"The big focus now within the Utica is the drier areas, where the initial production rates of new wells are incredibly high," Yahya said. "This means you do not need to bring online as many wells to help keep production afloat."
A March report from the EIA finds output from Utica is in part behind the commercial viability of liquefied natural gas terminals planned or in service in the United States.