REG - UK Oil & Gas PLC - Loxley Gas Project Update

UK Oil & GasAnnouncement

27/03/2024 07:00

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RNS Number : 4003I  UK Oil & Gas PLC  27 March 2024

UK Oil & Gas PLC

("UKOG" or the "Company")

 

Loxley Gas Project Update

UK Oil & Gas PLC (London AIM: UKOG) is pleased to announce that following
the Court of Appeal's 9(th) January 2024 ruling refusing any further appeals
against Loxley's lawful planning consent (RNS of 10 January 2024), the North
Sea Transition Authority has now granted a one-year extension to the PEDL234
licence's Retention Area Work Programme in which the Loxley gas discovery is
contained.

In order to retain the full 300 km² licence area without any future partial
relinquishment, the Company must now commence drilling the Loxley-1 appraisal
borehole no later than 30 June 2025. Loxley-1 is designed to confirm the
commercial viability of the Company's material 100%-owned Loxley gas discovery
and its related hydrogen feedstock project.

Loxley's current Competent Persons Report ("CPR") (see: RNS 21 February 2023)
assessed that Loxley, one of the UK onshore's largest historic gas
discoveries, contains a mid-case 2C Contingent Resources recoverable volume of
31.0 billion cubic feet net to UKOG. The CPR's associated post-tax 2C case
present value (at 10% discount rate) was assessed at £124 million net to UKOG
using end December 2022 gas prices and £87 million net to UKOG using an RPS
Energy forward price forecast. The CPR is available on the Company's website
www.ukogplc.com (http://www.ukogplc.com) .

The Loxley CPR's recoverable volumes stated as Contingent Resources (as
defined in the glossary below) should not be construed as Reserves (also
defined below). Further successful development of the asset would be required
to seek to move the CPR classification to Reserves.

For further information, please contact:

UK Oil & Gas plc

Stephen Sanderson / Guzyal Mukhametzhanova
                                       Tel:
01483 941493

 

WH Ireland Ltd (Nominated Adviser and
Broker)

James Joyce / James Bavister / Andrew de Andrade
                              Tel: 020 7220 1666

 

Communications

Brian Alexander
 
                     Tel: 01483 941493

 

 

Glossary of terms

 2C          the mid-case or average estimate of Contingent Resources. There is estimated
             to be a 50% probability that the quantities actually recovered could equal or
             exceed this estimate.
 CPR         Competent Person's Report, a Petroleum Resources report prepared by an
             independent Competent Person(s), providing an estimated range of remaining
             recoverable resources and their potential monetary valuation in accordance
             with the relevant reporting standard (in this case the 2018 Society of
             Petroleum Engineers' PRMS). The RPS CPR was not prepared under the AIM rules
             for oil & gas companies.
 Contingent  those quantities of petroleum estimated, as of a given date, to be potentially

           recoverable from known accumulations, but the applied project(s) are not yet
 Resources   considered mature enough for commercial development due to one or more
             contingencies. Contingent Resources are further categorised in accordance with
             the level of certainty associated with the estimates and may be sub-classified
             based on project maturity and/or characterised by their economic status.
 discovery   a petroleum accumulation (gas in Loxley's case) for which one or several
             exploratory wells have established through testing, sampling and/or logging
             the existence of a significant quantity of potentially moveable hydrocarbons.
 PRMS        Petroleum Resources Management System created by the Society of Petroleum
             Engineers. A global standard of petroleum reserve and resource classification
             together with guidelines and accepted methodologies for the definition and
             estimation of petroleum resources and their monetary valuation.
 Reserves    those quantities of petroleum anticipated to be commercially recoverable by
             application of development projects to known accumulations from a given date
             forward under defined conditions. Reserves must satisfy four criteria:
             discovered, recoverable, commercial and remaining (as of the evaluation's
             effective date) based on the development project(s) applied. Reserves are
             further categorised in accordance with the level of certainty associated with
             the estimates and may be sub-classified based on project maturity and/or
             characterised by development and production status.

 

 

The information contained within this announcement is deemed by the Company to
constitute inside information under the Market Abuse Regulation (EU) No.
596/2014, as it forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018. Upon publication of this announcement, this information
is now considered to be in the public domain.

 

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