A small British oil producer has discovered a huge oil field south of London that could contain billions of barrels of oil. But recovering the wealth could be difficult and might require controversial fracking.
British oil company UK Oil and Gas Investments (UKOG) announced on Thursday that around 100 billion barrels of oil could lie below the countryside close to London's Gatwick Airport - 20 times more than had previously been expected.
Following exploration drilling by US-based Nutech, which is part of UKOG, the company said its Horse Hill-1 site contained an estimated 158 million barrels of oil per square mile (2.58 square kilometers). UKOG's total area encompasses 55 square miles and is part of the Weald Basin oil field.
UKOG's Chief Executive Stephen Sanderson described the find as a "world class" resource.
"We think we've found a very significant discovery here, probably the largest [onshore in the UK] in the last 30 years, and we think it has national significance," he told the BBC.
The British Geological Survey estimated last year that Weald Basin reserves totaled some 4.4 billion barrels. The new survey shows oil reserves in the Weald Basin to be as large as Kuwait's proven oil reserves of 101.5 billion barrels.
Find fuels fracking controversy
According to UKOG's chief, however, only three to 15 percent of the reserves were recoverable with "conventional horizontal drilling and completion techniques."
Professor Alastair Fraser, a petroleum geologist at London's Imperial College, told the BBC on Thursday that fracking would be needed at some stage to make oil extraction in the area commercially viable.
Hydraulic fracturing - or fracking in short - in which chemicals and water are blasted in underground rock formations to release trapped gas and oil, has come under fire from environmentalists who are concerned about groundwater contamination and earth tremors. But the UK government is determined to create a shale oil and gas boom to ensure these unconventional resources will help stem a decline in North Sea energy reserves.
Mike Jakeman, a global commodities analyst at the Economist Intelligence Unit, told the Reuters news agency that the discovery was unlikely to prove a "tonic for the UK energy industry." He said oil from the well was probably too expensive to produce at a time when weak crude prices meant that companies were favoring projects with lower costs.
uhe/el (Reuters, AFP, dpa)