Share prices for both UK Oil and Gas (UKOG) and Solo Oil (SOLO) have risen recently as work on the Weald Basin site near Gatwick has officially begun.
The 8,512ft well which will be constructed in the area – named Horse Hill-1 well – is expected to be controlled by the Horse Hill Development from next month.
Targeting both Jurassic and Triassic-aged reservoirs, the well could provide a significant boost to the country’s oil and gas industry.
‘Good oil shows’
According to reports, “good oil shows” were found at a number of Jurassic levels in a well north-east of Horse Hill Wood and this provides plenty of hope for those working on the Horse Hill-1 well.
Since construction started, share prices for the companies involved has risen considerably with UKOG up 24% (0.9p with a 0.5p spread) and SOLO up almost 10% (0.29p with a 0.02p spread). This also reflects wider trends as recent news revealed that the FTSE 100 gained 25 points after oil and gas firms performed strongly in the wake of news from Iraq.
Both firms also witnessed an increase in their market capitalisation thanks to the rising share prices; UKOG reported a value of £7.27 million and SOLO £13.33 million.
This positive performance is expected to increase as the development at the Horse Hill site continues with SOLO planning to own 10% interest and UKOG taking 7.5%.
‘An important milestone’
With plenty of growth expected to be generated by this development in the future, the onset of construction at the Horse Hill-1 well has been named “an important milestone”.
Neil Ritson, the executive director of Solo, explained that “the next few months will be an exciting period” for everyone involved with the project.
Once constructed, oil and gas firms will drill into the Triassic age formations to evaluate currently unexplored potential for gas which is believed to be within the structure and, if present, is likely to be “gas charged”.