Over £300bn worth of oil found near Gatwick airport
The total discovered could be worth a cumulative £336bn at current oil prices per barrel, and is equivalent to roughly a fifth of the oil extracted from the North Sea in the past four decades.
Markets responded excitedly to the development, with shares in UK Oil & Gas Investments jumping by 325.3 per cent (to 4.7p) in the wake of the news. Other companies with interests in the area saw their shares climb too, with Alba Mineral Resources up by 191.7 per cent, Solo Oil by 44.8 per cent, and Stellar Resources by 111.8 per cent. Shares fell slightly, however, when UK Oil & Gas clarified that it may not be possible to extract all reserves from the site.
“We think we’ve found a very significant discovery here, probably the largest in the last 30 years, and we think it has national significance,” says Stephen Sanderson, chief executive of UK Oil & Gas Investments.
“Drilling the deepest well in the basin in decades, together with the ability to use concepts, techniques and technology unavailable in the 1980s, has provided new cutting-edge data and interpretations to comprehensively change the understanding of the area’s potential oil resources.”
“We’re looking at between 50 and 100 billion barrels of oil in place in the ground,” Sanderson concludes. “Between 3 to 15 per cent of the oil can be recovered, which could mean anything between 1.5 and 15billion barrels,”
Mike Jakeman of the Economist Intelligence Unit questioned Sanderson’s claims, on the grounds that the current price of oil “means that only the cheapest oilfields are being exploited.”
“Higher-cost ventures, such as Canada’s oil sands and off the coast of Brazil, are not economically viable at the current price level. This discovery in the UK would almost certainly fall into this category.”