Gatwick oil find company says licence runs out in September

Minutes To Midnight

More potentially bad news for those hoping Gatwick would turn out to be the new Dallas.

To recap, UK Oil and Gas Investments caused some excitement earlier this month by saying there might be 100bn barrels of oil near the airport after results from drilling the Horse Hill well.

A week later it appeared to be backtracking from such claims, saying the 100bn was an estimate for the whole area and not just the Horse Hill licences.

And now it has revealed that one of the licences - PEDL137 which was the subject of the original announcement - would expire on 30 September this year and it was in the process of asking for a one year extension.

UK Oil and Gas shares have dropped 3% to 2.9p on the news, while Solo Oil which also has an interest in the project has fallen 3.5% to 0.558p. Analysts at SP Angel commented on Solo, saying:

In light of the news that PEDL137 is in process of being renewed, it seems a little odd that the Horse Hill prospectivity has been hyped and deflated the way it has – it has created a headwind for the operator in the negotiation of the terms of the obligation work programme in return for the extension.

Still, we don’t believe that the licence will be rescinded, or not extended, but the demands will be onerous on the group to fulfil, and given the planning headwinds, we don’t see a year being enough time.

Powered by article was written by Nick Fletcher, for on Tuesday 28th April 2015 11.48 Europe/London © Guardian News and Media Limited 2010


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