UK Oil and Gas Investments share price slips after downplaying size of Horse Hill Gatwick oil discovery in "clarification"

Lynsey Barber
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The Weald Basin is Britain's answer to Dallas (Source: Getty)

The company behind an oil discovery at Horse Hill near Gatwick which it claimed could be larger than the North Sea oil fields has issued a clarification downplaying the size of the find.

UK Oil and Gas Investments (UKOG) clarified that estimates "should not be considered as either contingent or prospective resources or reserves," after saying the area could hold as much as 100bn barrels.

Shares in the Aim-listed oil investment firm opened 20 per cent down recovering in early trading and were up more than two per cent at pixel time.

In a report last week, UKOG said an investigation into the Weald Basin area in the south of England could hold 158m barrels per sq mile - the largest onshore oil discovery in the last 30 years.

Chief executive of UKOG Stephen Sanderson said that based on the findings, there were "between 50 and 100 billion barrels of oil in place in the ground" speaking to the BBC following the announcement, and believed between three and 15 per cent of could be extracted.

The surprise discovery, well above previous estimates of 4.4bn barrels by previous geological surveys, sent shares up more than 300 per cent in intraday trading.

UKOG today clarified that it holds a license that covers an area of 55 sq miles while the Jurassic sections which potentially hold oil cover an area of 1,100 sq miles - a fraction of the Weald Basin.

"The company has not undertaken work outside of its licence areas sufficient to comment on the possible OIP [oil in place] in either the approximate 1,100 square miles or the whole of the Weald Basin," the company has said, adding: "Further development work in the form of appraisal drilling, well testing and assessment of recovery factors will be required to seek to quantify net resources in relation to the Company's licence areas and to prove its commerciality."

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