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Horse Hill: To frack or not to frack?

Published: 08:30 31 Aug 2015 BST

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Press releases about Horse Hill studiously avoid using the “F” word

The Horse Hill project on the West Sussex/Surrey border in southern England near Gatwick Airport has already been touted as potentially the largest onshore oil discovery in the UK for many years and could be a world class field.

In June a study by Nutech, an American independent industry consultant, said the ‘‘best’ estimate says for the field is that it could host 9.2bn barrels of oil in place, with broader estimates in a range between 3.1bn and 17bn barrels.

Now oil services giant Schlumberger - again acting for the consortium that runs the project, which includes UK Oil & Gas (LON:UKOG), Solo Oil (LON:SOLO), Alba Minerals (LON:ALBA) and Evocutis (LON:EVO) - upgraded the estimates.

According to Schlumberger three tight Jurassic limestones of the Kimmeridge Clay formation in the 55 square miles area of the Weald Basin could host 10.99 bn barrels of oil-place.

These estimates might sound more and more mouth-watering with each new survey but they are also confusing, because nobody knows how much of the oil-in-place is recoverable.

Significantly, Nutech believes the Jurassic discoveries in the Horse Hill well are possibly very similar to well-known US ‘hybrid’ plays such as the Bakken, Wolfcamp, Bone Springs.

Hybrid plays consists of a mixture of both conventional and unconventional horizons where the oil or gas is tightly held. Recovery rates of the oil-place in the US has ranged from 3 -15% of the oil-in-place.

One of the UK’s leading geologists, who also happens to be an executive of a publically quoted oil and gas company, said to Proactive Investors: “A key piece of information we are missing is just how much oil is recoverable and whether the partners will have to frack the structure.

“Certainly they would never have got the kind of returns they have from the Bakken without fracking.”

He explained in layman’s terms what fracking can do.  

If you drill a vertical well you might get, say, 50 barrels of oil a day (bopd), he said.

If you then extend the well horizontally you can increase output three or four times because you reach a greater area of rock.

If you do a number of fractures from the horizontal well you can increase output by ten times because to access more spores in the rock.

As every child of school age must now know fracking is a controversial process for many people in the UK.

There was never any intention to frack Caudrilla’s horizontal well in Balcombe, also in Weald Basin, last year because the shale rock was naturally fractured. But the drilling attracted huge numbers of protesters.

David Lenigas, until recently the head of UK Oil & Gas, has always said he believes there will be no need to frack at Horse Hill because of natural fractures in the zones.

The flurry of press releases about the latest Horse Hill estimates are circumspect and studiously avoid using the “F” word.

In the announcements today the Horse Hill companies said they had commissioned engineering and environmental studies to “investigate a conceptual Weald Jurassic field development”.

They said the prime objective must be that it “respect and preserve the rural beauty and way of life of the area, with minimal environmental impact, while at the same time providing a valuable contribution to the area's economy”

However if the day comes when the returns from just conventional drilling turn out to be uneconomic what will the companies do? You may well ask. 

 

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