UK Oil & Gas plc (UKOG) said that the Environment Agency had granted the company a full production permit for its 85.635% owned Horse Hill oil field in Surrey.
PERMISSIONS
The company said it submitted its initial application for the permit 31 months ago on 24 September 2019.
UKOG added that the permit issued today enabled production and water re-injection operations, incineration of waste gas, maintenance/workovers and the drilling of further development wells.
The company said that, to date, production at Horse Hill had operated under “the umbrella of prior testing consents which excluded any ability to reinject produced saline formation water”.
UKOG will now proceed with its plans to convert Horse Hill-2z into a water injector during 2022.
If implemented, this would remove “the need for costly transportation and disposal of produced saline formation water at remote third-party sites”.
REVIEW
The company said it started to review the viability of reinstating Kimmeridge production and further new Portland infill drilling location.
Chief executive Stephen Sanderson added that the permit allowed UKOG to return Horse Hill’s produced saline formation water back to the oil-bearing Portland rocks where it originated.
This would lower operating costs per barrel, removing HGV tankers from congested roads and reduce the field’s overall carbon footprint.
“The ability to reinject makes both environmental and economic good sense.”
ALBA MINERAL RESOURCES
Alba Mineral Resources plc, which owns 11.765% of Horse Hill, welcomed the news.
“We look forward to hearing of the operator’s plans for enhancing productivity and delivering on the inherent, and to date largely untapped, value of the Horse Hill oil field,” said executive chairman George Frangeskides.