Oil firm will float to pump more in the Home Counties

ANGUS Energy, one of the companies exploring for oil in the Home Counties, is planning to join the UK stock market in the next few weeks, hoping to raise millions of pounds to expand its drilling operations in Surrey and Sussex.

The group, which plans a flotation before Christmas that will see it join the junior AIM market, was behind the exploration at Horse Hill that made headlines earlier this year, with claims of a huge oil find near Gatwick airport.

Angus retains a small stake in Horse Hill, but its flotation is intended to raise cash to expand existing wells at Brockham, near Dorking, in Surrey, and in the Lidsey oil field near Bognor Regis, in West Sussex.

Paul Vonk, managing director at Angus, said the two sites were already pumping about 50 barrels a day but extending the wells could raise output to 400 barrels a day.

The oil price remains low at just over $45 (£30) a barrel. However, Vonk said that once complete, the expansion would allow oil to be extracted at a cost of £15 a barrel or less, which would mean a healthy margin on the project.

‘We think the existing assets are worth about £6 million,’ he said.

That excludes reserves at the Horse Hill site, in which Angus holds a 6 per cent stake. The potential of that site will be subject to fresh tests early next year.

The Horse Hill site generated dramatic headlines in April, when UK Oil & Gas, the largest investor in the site, said up to 100billion barrels could lie under the area. However, the amount that could be extracted would be much lower than that.

Shares in UK Oil & Gas tripled in value after the announcement.

But the claims were met with scepticism by some observers.

Shares in UK Oil & Gas have since fallen back, but are still more than 50 per cent higher than before the announcement.