Highlights:

• Kimmeridge Limestone 4 (“KL4”) EWT operations now underway. Further updates to follow in due course following flow stabilisation and pressure build up tests.
• Oil & gas consultancy group Xodus reports that the single HH-1 well “sees” a connected Portland oil in place (“OIP”) of approximately 7-11 million barrels.
• Horse Hill Portland and Kimmeridge long-term production scoping report submitted to Surrey County Council (“SCC”). Overall plan includes a total of six production wells, with two production wells and a reservoir pressure support well in the Portland oil pool.
• A planning application for production to be submitted to SCC prior to the completion of the 2018 EWT programme.

Alba (AIM: ALBA), the diversified mineral exploration and development company, has been informed by Horse Hill Developments Ltd (HHDL), the operator of the Horse Hill-1 ("HH-1") Kimmeridge and Portland oil discovery located in licence PEDL137, that following the successful Portland EWT programme, the KL4 EWT flow sequence operation has now commenced. Alba holds an 11.765% beneficial interest in licence PEDL137 and adjoining licence PEDL246.

Alba is further advised by the Operator as follows:

• Further to the reported Portland EWT results, Xodus has now delivered a report which details that, to date, the single HH-1 well has “seen” approximately 7-11 million connected barrels out of the total estimated full field OIP (or Stock Tank Oil Initially in Place “STOIIP”), as set out in UK Oil & Gas Plc’s admission document dated 13 July 2018. Based upon modelled production profiles and oil recoveries, the Operator believes this to be a commercial connected OIP volume for a single well and that it supports the Operator’s envisaged multi-well Portland oil drilling and production programme. It should be noted that the calculated connected OIP should not be misconstrued as recoverable volumes or reserves.
• Given the EWT has delivered both commercially viable Portland flow rates and connected oil volumes, an internal declaration of Portland commerciality will be made shortly by HHDL. The preliminary internal assessment generated by Alba’s technical team from the available data supports this view.
• As the first part of the regulatory process necessary to deliver the goal of long-term oil production at Horse Hill in 2019, HHDL has recently submitted an outline production scoping report to SCC.
• The scoping report details the envisaged environmental impact of the outline development’s future drilling, production, decommissioning and site restoration phases. The envisaged development has a total of six production wells and assumes a maximum daily rate of around 3,500 bopd. During the production phase it is envisaged that should production capacity exceed 3,500 bopd an application to increase total produced volumes
• will be made. The Portland oil pool is envisaged to be produced via up to two wells and one pressure support well. As previously reported, planning permissions are in place to drill and flow test the first two new wellbores, HH-1z and HH-2, with a planned early 2019 spud date.
• Average HGV movements during the plan’s 20-year field production life are estimated to total three per day.
• Following SCC’s feedback on the scoping report, HHDL will submit a full-scale production planning application, currently planned to be submitted before the completion of the 2018 EWT programme.

George Frangeskides, Alba’s Executive Chairman, commented:
"These ambitious plans revealed by the Operator to drill up to a further four wells at the Horse Hill site, on top of the already planned HH-1z side-track well and HH-2 new well, supports our belief in the potential for Horse Hill to provide material production and cash flow returns to Alba in the medium to long-term. In the short-term, meanwhile, we await the results of the current Kimmeridge EWT, which we hope will further underpin the plans to submit a planning application for the commencement of full-scale production.”

“On the corporate front, the recently announced disposals by a number of the participants of their stakes in Horse Hill means that Alba is now the sole AIM-quoted participant in the Horse Hill venture aside from UKOG, and the third largest participant in the Project overall, after UKOG and Tellurian Inc (NASDAQ: TELL). Alba remains a committed participant in Horse Hill and we look forward to reporting further news in this fast-developing project as it arises."