UK Oil & Gas Investments Plc (NEX, AIM:UKOG) Drilling Update at Broadford Bridge-1

UK Oil & Gas Investments PLC (London AIM and NEX: UKOG) is delighted to announce that core, totalling 330 ft, has been successfully recovered from the Kimmeridge Limestone 4 (“KL4”) target zone at its 100%-owned Broadford Bridge-1 (“BB-1”) exploration well.

Mobile light oil continued to be observed seeping from multiple sections of fractured KL4 calcareous shales and limestones throughout the cored section. Wet gas readings maintained high levels throughout the coring, being almost identical to those seen at the Horse Hill-1 (“HH-1”) Kimmeridge Limestone oil discovery, 27 km to the north east. Mobile Kimmeridge oil was also recovered from the drilling fluid. Further core will be taken through the deeper KL3 target zone.

The presence of light mobile oil in fractured Kimmeridge shales is highly significant. At first look, this corroborates the finding from Horse Hill-1 that oil production was likely derived from a much larger reservoir “tank” than the two KL3 and KL4 zones alone. The possibility that we have encountered a single 600-700 feet thick, naturally fractured oil reservoir section, encompassing all four Kimmeridge Limestones and underlying a significant proportion of the wider Weald Basin, will now be rigorously examined during the flow testing programme.

The well remains on schedule and under budget.

The core taken to date in the Upper Kimmeridge Shales and Limestones is now under extensive geological, petrophysical and geo-mechanical analysis by COREX in Aberdeen and Premier Oilfield Laboratories in Houston, Texas, and Bartlesville, Oklahoma, USA.

Stephen Sanderson, UKOG’s Executive Chairman commented:

“The coring programme continues to deliver positive results and important new insights into this continuous oil accumulation, the first of its kind discovered in the UK.

Following the KL3 and contingent KL2 coring programmes, we will run electric logs, set the final 7-inch steel casing and then, following the grant of the remaining necessary regulatory permissions, move straight to extended flow testing operations around the second half of July.”

About Coring

Coring is a drilling technique that involves using a doughnut-shaped drilling bit to capture or “cut” a continuous cylinder-shaped core of undamaged in-situ rock. The core is captured in a steel pipe or “core barrel” above the core bit. Core is normally cut in 30 feet lengths, or multiples of 30 feet, and in the case of BB-1 with a diameter of 4 inches. Core is taken in petroleum reservoir rocks for detailed laboratory analyses of geological, petrophysical and geomechanical parameters, and of any hydrocarbons and fluids contained within the rock.

About BB-1

BB-1 is located near Billingshurst, West Sussex, within the 300 km² PEDL234 licence, in which the Company has a 100% interest via its ownership of the licence’s operator, Kimmeridge Oil & Gas Limited (“KOGL”). The well, an exploration step-out, is designed to penetrate four naturally fractured Kimmeridge Limestone units (KL1-KL4), the uppermost two units of which flowed at record rates in the Horse Hill-1 discovery near Gatwick Airport.

Importantly, to prove that the Kimmeridge Limestones lie within an extensive continuous oil deposit, the BB-1 well was deliberately designed to test a feature with no structural or stratigraphic closure at the KL1-KL4 horizons.

The plan is now to core the KL3 target zone and then continue to drill 8 ½” diameter hole at a constant inclination of 54 degrees to vertical to total depth. Further core may be taken in KL2. The planned overall horizontal deviation of the well is approximately 1 km. The Kimmeridge Limestones (KL 1 to KL4) are expected to be encountered at a drilled depth of approximately 1250-1700 metres, which equates to around 950-1200 metres vertically below the surface.

Qualified Person’s Statement

Stephen Sanderson, UKOG’s Executive Chairman, who has over 35 years of relevant experience in the oil industry, has approved the information contained in this announcement. Mr Sanderson is a Fellow of the Geological Society of London and is an active member of the American Association of Petroleum Geologists.

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