A Competent Persons Report on Recoverable Resources, conventional Oil Accumulation Portfolio in the Weald Basin, UK was released today from AIM-listed UK Oil & Gas Inv PLC (UKOG) today. This CPR, the first evaluation of entire conventional asset base reveals some interesting figures and we take a look at what lies in the Weald Basin in southeast England, an area considered potentially rich in hydrocarbons.
Before we look at the geology, the newly identified plays and the prospectively behind the hype we publish UK Oil & Gas Inv PLC (UKOG) RNS that was released today (Full RNS Link HERE)
Horse Hill, one of the most talked about discoveries in the UK for decades – not just by the industry – lies in the Weald Basin in southeast England, an area considered potentially rich in hydrocarbons, but which has been ignored for decades. With the help of experienced UK geologist, Chris Pullan, we look at the geology, the newly identified plays and the prospectively behind the hype.’
“More than 70% of the wells in the Weald Basin, most of which were drilled between the 1960s and early ’80s, have encountered hydrocarbon shows,” says Chris Pullan, a consultant with Magellan Petroleum. “There was evidence of hydrocarbons at several levels, so why were they not followed up properly until now?
There could be several reasons, including the fact that drilling in the very populated and protected south-east of England, a mere 60 kilometres or so south of London, is practically quite difficult – but mostly, I think we just didn’t look hard enough at the results.”
Interest in the Weald’s potential has been increasing in recent years, but the area really hit the headlines late in 2014 when preliminary results from Horse Hill-1, drilled on PEDL (Petroleum Exploration and Development Licence) 137 on the northern flank of the Weald Basin, suggested the total in-place resource for the area could be considerably larger than previously estimated. Further positive analysis and testing of the well led to news reports suggesting the discovery – nicknamed by the press the ‘Gatwick Gusher’ – may be ‘a world-class resource with millions of barrels of oil’, which could play a ‘key role in transforming the UK’s energy balance’.
Less positive press exposure to the hydrocarbon potential of the area had occurred in 2013 and 2014, when Cuadrilla Resources proposed a test well near the village of Balcombe in the centre of the Weald Basin. There was considerable public concern and active anti-fracking protests over the proposed well, although no application to use hydraulic fracturing had been made.
Early Gas Use
The occurrence of hydrocarbons has been recorded in southern England for over 150 years, with gas being reported in water wells as long ago as 1836, as well as natural oil seeps being noted. In fact, the first UK discovery and production of onshore gas was in the Weald Basin, when gas was found in water wells during the construction of Heathfield railway station, subsequently used to power the lights for the station.
The first exploration wells were drilled in the Weald Basin in the 1930s. A major phase of exploration from 1930 to the 1960s focused on drilling surface features, but with little success. The 1973 discovery of oil in Triassic sandstone at Wytch Farm – at the time the largest onshore oil field in Europe (see Wytch Farm Ploughs Ahead by Will Thornton) – in the adjacent Wessex Basin to the west of the Weald Basin, led to a resurgence of interest in the region.
Also in the 1970s, improvements in seismic acquisition techniques enabled exploration of prospective plays which were previously hidden below unconformities. A number of new wells in the first half of the 1980s resulted in the first commercial discoveries in the Weald Basin.
These included the Humbly Grove, Herriard, Horndean and Singleton oil fields in the western parts of the basin, reservoired in the Middle Jurassic Great Oolite Formation. Fields found in the Upper Jurassic sandstones and limestones in the northern and central part of the basin at this time included the Palmers Wood and Brockham oil fields and Albury and Godley Bridge gas fields.
After oil prices crashed in the late 1980s there was little interest in the region for nearly two decades. At the moment, there are 13 producing sites in the Weald Basin, but some are almost 30 years old and many reservoirs are declining. However, the last decade has seen a considerable resurgence of interest in the area, with some very interesting well results.
Time for a Fresh Look
“In the 1980s, following the success at Humbly Grove, companies were primarily focused on the Middle Jurassic Great Oolite limestones in the south and west of the Weald Basin. The basin centre was written off due to rather poor reservoir development,” Chris explains. “And because of the oil price drop people did not follow up the Upper Jurassic discoveries on the north flank. There was very little focus on other horizons, particularly on any deeper potential. No one had really tried to see the bigger picture of the overall basin, partly due to the fragmentation of the database.
“Magellan Petroleum first got into the Weald Basin during the 9th UK Onshore Round back in 2000. We knew there was potential, but had a lot of questions. For example, what was the source of the oil in the younger formations – could it be the same Lower Jurassic shales as at the Wytch Farm field, even though their quality in the Weald Basin was fair at best? Or was it sourced from a higher level, such as the Oxford or Kimmeridge Clays? What about the possibility of a deeper gas play? How deformed was the centre of the basin? We methodically set about preparing a regional study to find answers to these questions, benefitting from the release of the well data and the UK Onshore Geophysical Library which had recently been established, so we could obtain long composite lines across the whole area. Once we had the regional perspective, including reprocessed vintage seismic, the plays just jumped out at us!”
“As a result of this new comprehensive analysis, we have identified a number of potential petroleum systems in the Weald Basin,” Chris says. The plays traditionally chased in the area are the Upper Jurassic Portland and Corallian Sandstones, although the latter shale out in the middle of the basin, and also the Middle Jurassic Great Oolite carbonates, all sealed by Upper Jurassic Kimmeridge Clay shales and Purbeck anhydrites. Magellan’s regional re-evaluation included new petrophysical and geochemical analysis and maturity modelling, which suggested that the oil could be coming from the Upper Jurassic Oxford Clay and in some areas from the Kimmeridge Clay. Furthermore, the source of the gas in the area was unlikely to be Jurassic and probably came from a deeper level, possibly Palaeozoic.
“This was a very exciting realisation, as it suggests that in addition to sourcing gas in higher levels, deeper Triassic reservoirs could also be charged from this source,” Chris explains. “The deeper gas play is virtually unexplored here since few wells have reached sufficient depth. This led us to look in more detail at the centre of the basin, where Jurassic reservoir development is poor, but where the Triassic sands are expected to be present.”
Meanwhile, some of the questions as to whether Upper Jurassic Kimmerigian Clays could be a source were answered by geochemical analysis of oil from a test of the Kimmeridgian Limestones in the Balcombe-1 well, originally drilled by Conoco, in the centre of the basin, which suggested the presence of a second, less mature, source. As Chris says, “The unconventional industry in the US had breathed new life into the UK onshore. We realised that the Kimmeridgian Clays might not just be sourcing the overlying Portland Sandstone, but also a new, unexplored play: the interbedded and stacked Kimmeridgian Limestones. We needed to map out the extent of the mature Kimmeridgian Clays as well as the interbedded limestones, known as the Micrites.”
Horse Hill Rears Up
Magellan invested in more blocks in subsequent licensing rounds and by 2010 had a large acreage position in the Weald Basin. One prospect the company started looking at closely was Horse Hill, a tilted horst block prospect in PEDL137, which lies on the northern edge of the basin, close to Gatwick Airport. A previous well on the block, Collingdean Farm, drilled in 1967, encountered ‘good oil shows’ in the Jurassic reservoirs and was even tested but did not flow. However, seismic reprocessing suggested that the well was offstructure, on the downthrown side of the major bounding fault.
“By 2013, Magellan was ready to drill a new well on the upthrown side of the fault. The prospect was farmed-out to Angus Energy Ltd., who later created Horse Hill Developments Ltd., with multiple consortium partners in order to fund the exploration drilling, and who became the operator,” continues Chris. “The well was completed in November 2014 and encountered several hydrocarbon-bearing horizons, including the Portland Sandstone and the Kimmeridge Limestone. Earlier this year, very successful flow testing was carried out on these horizons and light sweet oil was produced from both reservoirs at high rates. This is particularly exciting, as it indicates that the Kimmeridge micrites are naturally fractured.”
Along with the new vitrinite reflectance data, the test results have redefined the limit of the maturity of the Kimmeridge source, suggesting that it is mature over a greater area than previously expected, possibly up to the northern bounding fault, thus considerably expanding the overall potential of the Basin.
A Large Resource
Public interest in the Horse Hill well was high, partly spurred by an incorrect belief that the well would be fracked, although this was never planned and the tests all took place above the UK fracking ceiling of 1,000m. There was additional interest when the results of technical studies of the well carried out by Nutech and Schlumberger were released, which suggested large estimates of oil in place. This led to a media frenzy about the somewhat inaccurately named ‘Gatwick Gusher’ and the millions of barrels of oil underlying the protected ‘Green Belt’ areas of the Weald.
“There is a very large potential resource here, but it is far too soon to make any realistic estimate of its size and how much of it can be recovered,” Chris says. “We need more data and a lot more fundamental analysis needs to be done, particularly so we can gain a much greater understanding of the hydrocarbon trapping; all wells so far have been drilled on structural highs, for example, so we need to prove that a stratigraphic trapping mechanism is effective. We also need to test long term and also look at several other horizons, before we can have a reliable idea of the size of recoverable reserves.
“The potential of the Kimmeridge is particularly exciting; we don’t have any good core from the section, as previously we just drilled through it to look at the deeper horizons. More work needs to be done on the geochemistry of the clays to analyse their oil potential and maturity. The centre of the basin is underexplored and we have yet to fully understand the level of uplift it has undergone during the Tertiary and the amount of resulting deformation. Also, the conventional Triassic gas play could be very significant, but needs a lot more data, work and analysis.”
Unlocking the Potential
The Weald Basin is home to millions of people and environmentally very sensitive, with large swathes being protected from development, which adds an extra layer to the issues surrounding the exploitation of this potential resource.
Gaining permission to drill a conventional well requires considerable time and financial resources, and the negative response from much of the UK population to the idea of fracking, particularly in environmentally sensitive areas, makes developing the resource underlying the Weald Basin a challenging activity – but Chris is optimistic: “The main risks are at the surface – I don’t think exploring in the Weald Basin carries a high subsurface risk. At the moment there is a lot of uncertainty, but with further work we will be able to understand much more about the geology, the resource and ultimately the potential,” he explains. “Several wells could be drilled in the near future and we are learning more all the time.
“For me, the most thrilling thing was realising that there are really interesting plays literally in my backyard and, with recent technological developments, developing these opportunities is possible. There are lots of undrilled structures and plays out there and I cannot wait to help unlock the potential of this area.”
By Jane Whaley
This article appeared in Vol. 13, No. 5 – 2016
If anyone reads this article found it useful, helpful? Then please subscribe www.share-talk.com or follow SHARE TALK on our Twitter page for future updates.
Terms of Website Use
All information is provided on an as-is basis. Where we allow Bloggers to publish articles on our platform please note these are not our opinions or views and we have no affiliation with the companies mentioned