Horse Hill oil field update

UK Oil & Gas PLC

("UKOG" or the "Company")

Horse Hill oil field update

UK Oil & Gas PLC (London AIM: UKOG) is pleased to announce that surface-based intervention operations at its 85.635% owned Horse Hill-1("HH-1") well have now has been completed.  The well has now been shut in for a long term pressure build up test ("PBU"), designed to provide data necessary to understand whether the Portland reperforation programme has achieved the desired optimisation of well inflow performance.

As previously announced  on October 1^st, the intervention's objective was to optimise oil flow by reperforating the full Portland oil producing section, inserting a new production tubing string and thus enabling the downhole pump to be placed at a deeper level. Originally the intervention was planned for April/May but, due to the COVID-19 lockdowns in both the UK and USA, a further unforeseen 6-month delay was introduced. Further updates will be reported when the PBU data has been fully analysed and interpreted.

The HH-1 intervention and other related activities are part of normal oil well optimisation. By their very nature, these operations and the continual need to optimise pump performance, can result in considerable down time i.e. periods of no production as such monthly or annual production figures may not fully reflect the long term flow rates of the well. During 6-month period to the end September 2020, approximately 28,060 bbls of oil were produced over approximately 135 operating days.

It should also be noted that in the normal course of conventional oil well optimisations there can be a requirement to change the placement of the downhole pump should the flow characteristics change over time, this can be the result of various factors including the break-out of solution gas and increased water cut, translating directly into a production decline over time. It is also normal that individual conventional oil well production declines over time.

The Horse Hill Portland and Kimmeridge oil field is operated by UKOG's subsidiary company Horse Hill Developments Ltd ("HHDL"), in which UKOG has a direct 77.9% interest. HHDL has a 65% interest in the field and surrounding PEDL137 and PEDL246 licences, with the remaining 35% interest held by UKOG's wholly owned subsidiary, UKOG (137/246) Ltd.

Qualified Person's Statement

Matt Cartwright, UKOG's Commercial Director, who has 37 years of relevant experience in the global oil industry, has approved the information contained in this announcement. Mr Cartwright is a Chartered Engineer and member of the Society of Petroleum Engineers.

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Glossary

The information contained within this announcement is deemed by the Company to constitute inside information under the Market Abuse Regulation (EU) No. 596/2014