Thursday 4 June 2020

UK Oil & Gas PLC (London AIM: UKOG) is pleased to announce that it plans to carry out the following material actions designed to further strengthen the Company's overall financial and oil production performance during the current low oil price environment:

1. Full repayment of the convertible loan with Riverfort Global Opportunities PCC Limited and YA II PN Ltd ("Loan Note"), making the Company debt free. The repayment eliminates the uncertainty attached to Loan Note conversion timings and pricing, something the Company feels was perceived to exert a negative influence on the Company's share price.

2. Materially reduced Horse Hill oil field operating costs ("opex") by a further $4 per barrel via a £1.65 million purchase of currently rented surface production equipment ("Equipment"). Overall asset level opex now reduces to approximately $13/bbl at current production rates, amongst the lowest in the UK oil sector.

3. Finalised plans for a short but material intervention in the Horse Hill-1 well ("HH-1") designed to further boost production rates this summer.

4. Raised £4.2 million at 0.2 pence per share to provide funding for the above and other key activities. To include preparations for work at the Loxley Portland gas appraisal well site, if planning approval is granted on 29 June, and follow-up of the Arreton, Isle of Wight planning application. Placing details are provided below.

The above actions will support the Company for the next stages of its development.

Stephen Sanderson, UKOG's Chief Executive commented:

"With the lockdown rules easing and encouraging signs of recovery in the Brent oil price, the Company has acted decisively to both strengthen its financial position, target further profitability of its flagship Horse Hill asset and start preparations for its next appraisal wells at Loxley and on the Isle of Wight."