SOLO OIL PLC Completes UK Onshore Acquisition
Solo today announces that it has entered into a Binding Heads of Agreement ("HOA") to buy a 10% interest in Horse Hill Development Ltd ("HHDL"), a special purpose company, which hold the rights to a 65% participating interest and operatorship, in licence PEDL137 onshore in the UK Weald Basin.
HHDL has an exclusive farm-in agreement with Magellan Petroleum (UK) Limited, a subsidiary of NASDAQ-listed Magellan Petroleum Corporation ("Magellan"), which currently own 100% of the 99.29 square kilometres (24,525 acre) Exploration and Development Licence No. 137 ("PEDL 137"). Under the agreement HHDL can earn a direct 65% participating interest and operatorship in the licence, under certain contractual conditions, through the drilling of the proposed 2,646 metres (8,680 feet) Horse Hill-1 exploration well by the end of August 2014.
The Horse Hill-1 well is planned to test a number of conventional stacked oil targets at the proven productive Portland sandstone, Corallian sandstone and Great Oolite limestone levels. Prospective recoverable resources totalling a mean 87 million barrels ("mmbbls") have been estimated; with an additional mean 164 billion cubic feet ("bcf") of recoverable prospective resources proposed within the deeper Triassic gas play.
Neil Ritson, the Company's Executive Director, commented:
"Solo is keen to expand its portfolio of global onshore oil and gas investments and the recent developments in the UK, have increased interest in the sector. The Horse Hill Wood prospect 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."
Horse Hill Wood Prospect
PEDL 137 is located in the Weald Basin in Surrey. The Horse Hill Wood prospect lies about 3 kilometres from Gatwick Airport and covers an area of up to 16 square kilometres in the south-west of PEDL 137. 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. Recent seismic re-interpretation suggests that the Collendean Farm-1 well was drilled off structure on the downthrown side of the bounding fault and outside closure.
The Triassic reservoir has yet to be tested in this part of the Weald Basin and if present is likely to be gas charged.
The Horse Hill Wood Prospect's OIP and GIP and Prospective Resources estimated by Magellan are summarised in Table 1 below.