Solo Oil (LON:SOLO) has added the UK to its global portfolio of interests with the acquisition of a stake in an exploration licence in Surrey’s Weald Basin.
The oil and gas group has signed a binding heads of agreement to pay up to £600,000 for 10% of Horse Hill Development (HHDL), a special purpose company with rights to a 65% participating interest and operatorship of the PEDL137 licence.
Nasdaq-listed Magellan Petroleum currently owns 100%, but HHDL can earn a 65% participating interest and operatorship through the drilling a 2,646 metres (8,680 feet) exploration well [Horse Hill-1] by the end of August.
Horse Hill-1 will test a number of conventional stacked oil targets at the proven productive Portland sandstone, Corallian sandstone and Great Oolite limestone levels.
The Horse Hill Wood prospect is three kilometres from Gatwick Airport and covers an area of up to 16 square kilometres in the south-west of PEDL 137.
Solo said: “The trap is a seismically defined tilted horst structure, similar to the Palmers Wood oil field which lies only about 20 kilometres to the north-east. The Collendean Farm-1 well, drilled by ESSO in 1964, lies on the north-eastern edge of the Horse Hill Wood structure and found good oil shows at various Jurassic levels.”
Prospective recoverable resources are estimated at a mean 87mln barrels with an additional mean 164bn cubic feet of recoverable prospective resources proposed within the deeper Triassic gas play.
Neil Ritson, Solo’s executive director, said recent developments in the UK, have increased interest in the sector and Horse Hill Wood represents an immediate opportunity for the company to participate in a significant conventional onshore oil and gas play.
“The initial drilling will target a prospect with material oil and gas potential and if successful in finding gas at the deeper Triassic level this will be a play opening well in the Weald Basin; very close to existing infrastructure and significant gas demand."
Solo will pay just over £13,000 immediately towards the cost of the Horse Hill-1 well, with a further £67,000 once the paperwork is complete. A further £520,000 will cover the drilling costs of HH1.
Solo’s main asset currently is in Tanzania, in the Ruvuma Basin, with other interests in East Africa and Canada.
