UK Oil & Gas PLC (LON:UKOG) has confirmed the completion of the initial phase of flow tests from the new horizontal well at Horse Hill, with results demonstrating the well’s ability to flow at rates significantly above the project’s existing vertical well.
In a statement, the company revealed that the well initially flowed at some 1,087 barrels of fluid per day during ‘clean-up’ with oil cuts of up to 60%.
Crude oil produced in the initial testing has been exported to Perenco's Hamble oil terminal for onward sale at market price, UKOG noted.
It added that the well is now shut-in for a scheduled long duration pressure build-up test.
In the meantime, the company said that preparations will now be made to finalise a series of planned interventions to further optimise flow rates from the Portland reservoir's sweet-spot.
The company noted that whilst the HH-2z well continued to clean-up prior to the current shut-in, returning crude oil, it also showed evidence of formation water ingress. Additional routine intervention will also take place to remedy this ingress, it added.
Further operations will take place in the New Year.
UKOG chief executive Stephen Sanderson said: “Although it's still early days in the EWT campaign, we are very encouraged by the magnitude of the initial flow rates. These confirm that HH-2z's horizontal trajectory can deliver flow rates from the Portland sweet-spot that significantly exceed those delivered by the HH-1 vertical discovery well.
“Our team's efforts are now firmly focused upon the routine elimination of water ingress and the continued optimisation of HH-2z's near-wellbore, both of which are designed to ensure HH-2z can deliver the best possible stable oil production rates over the coming year."
He added: “Whilst there is still much to be done, these early results, together with the timely submission of the FDP to the OGA, mean we are well on the way to delivering significant production at Horse Hill."
UKOG is the largest stakeholder in the Horse Hill venture, with a controlling 85.635% interest, via both direct stakes in the project and indirectly as a shareholder in Horse Hill Developments Ltd (HHDL).