Gatwick oil explorer has prospection licence renewed

13th May 2015 16:46

UK Oil and Gas Investments (UKOG), the AIM-listed independent oil explorer made infamous for its bold claim of having found 100bn barrels of oil close to Horse Hill near Gatwick airport, announced on Wednesday that its exploration licence for the site had been extended. The company's shares jumped 5.5% on the revelation. UKOG holds a stake in the Horse Hill prospection area along with four others. It will now have until 30 September, 2016 to explore the area.UKOG is still waiting for permission from regulators to perform flow tests which are planned for later this year in order to further gauge how much oil is held there. The licence also has the potential for a production period of 19 years.Two further licences in which UKOG holds a stake - Markwells Wood and Baxters Copse - have also been extended by a year each, with an expiry date of 30 June, 2016.Last month, the company claimed Horse Hill site had up to 100 billion of potential oil reserves, way in excess of the 46bn recovered in over four decades from North Sea exploration.Following severe criticism from independent experts, the company chief executive Stephen Sanderson and chairman David Lenigas were forced to "clarify" that further tests would be needed to ascertain viability of the prospect.