Key Points
- UK Oil & Gas PLC (“UKOG”) has raised a further £0.52 million through a placing of new ordinary shares.
- Combined with prior fundraising, the total new investment since early October 2025 has exceeded £5 million.
- The placing shares are being issued at 0.016 pence per share – a ~26% discount to the closing price on 20 November 2025.
- Funds will be used to accelerate technical and economic modelling studies, supporting hydrogen storage, hydrogen production, and energy-transition activities through end-2026.
- UKOG’s subsidiary, UK Energy Storage (UKEn), will collaborate with a second regional hydrogen pipeline provider, focusing on the South Dorset Storage project.
- This is in addition to an earlier announced collaboration between UKEn and National Gas, focused on the Yorkshire hydrogen storage opportunity.
- The additional funding also supports a potential electrolytic hydrogen generation project in Dorset, aimed at decarbonising a local industrial user.
- UKOG aims to secure government revenue support through the Hydrogen Transport and Hydrogen Storage Business Model (“HSBM”) allocation rounds, expected to begin in H1 2026.
- The placing involves issuing 3,249,134,670 new shares.
- CMC Markets UK plc, trading as CapX, is acting as the placing agent.
- Admission of the placing shares on the AIM market is expected around 27 November 2025.
- In a separate but related earlier move, UKOG raised £1 million via direct subscription at 0.03p per share, to fund engineering concept and design studies, especially for collaboration with National Gas.
- According to UKOG’s management, recent funding brings the company into a “strong position” to advance its hydrogen storage and generation projects.
- UKEn has also signed Memoranda of Understanding (MoUs) with Portland Port for hydrogen opportunities including local electrolysis and import of green hydrogen.
What Has UK Oil & Gas PLC Announced About UKEn Hydrogen Funding?
UK Oil & Gas PLC (UKOG), listed on the London AIM market, has confirmed it has accepted a further £0.52 million in investment through a placing of new ordinary shares. This places the total fresh capital raised since early October 2025 at more than £5 million, encompassing multiple funding tranches.
The placing involves issuing 3,249,134,670 new shares, priced at 0.016 pence per share, which represents a discount of about 26% relative to the closing price on 20 November 2025 (0.0215p). The admission of these shares for trading on AIM is expected to occur around 27 November 2025, according to UKOG.
Why Is UKOG Raising More Money?
The additional funding is earmarked to accelerate UKOG’s hydrogen-related development programmes, in particular for its wholly owned subsidiary UK Energy Storage (UKEn). According to UKOG’s own regulatory disclosures, these funds will be directed toward:
- Technical and economic modelling studies – essential work to validate project feasibility and costs.
- Engineering concept and design studies for strategic collaborations.
- Strengthening a collaboration with a second regional hydrogen pipeline operator, specifically focusing on the South Dorset Storage project under UKEn.
- Progressing a potential electrolytic hydrogen generation project in Dorset, intended to decarbonise a major industrial user.
- Economic modelling to explore joint-venture opportunities with infrastructure and sector specialists for UKEn’s hydrogen storage business.
How Does This Fit Into UKOG’s Broader Energy Strategy?
UKOG’s renewed capital raising reflects a clear pivot in its strategy: away from its traditional petroleum business, and toward clean energy, particularly hydrogen storage and generation.
In its 2025 Annual Report, the company emphasised its core future focus on salt-cavern hydrogen storage projects in South Dorset and Yorkshire. The recent funding will help UKOG commission and deliver the engineering and design work needed to realise its collaboration with National Gas, first announced in October.
Why is that collaboration critical? UKOG argues that under the UK Government’s Hydrogen Transport and Hydrogen Storage Business Model (HSBM), storage operators and pipeline providers must now apply jointly for revenue support. In a meeting with the government’s HSBM team on 23 September 2025, the company was informed of this new requirement, underscoring the importance of these joint studies and partnerships.
What Is the Role of Government Support?
UKOG clearly views the HSBM revenue support mechanism as vital to its hydrogen ambitions. The HSBM allocation rounds are now scheduled to begin in the first half of 2026, according to the company. By commissioning co-ordinated studies and forming partnerships with pipeline operators, UKOG aims to position itself strongly for these upcoming allocations.
What Are the Projects Involved?
One of the central elements of UKOG’s hydrogen strategy is its South Dorset salt-cavern storage project. The new tranche of funding will support a collaboration between UKEn and a second regional pipeline operator, complementing its existing partnership with National Gas.
Yorkshire Storage Opportunity
Parallel to the Dorset project, UKOG and UKEn have been working on a hydrogen storage opportunity in Yorkshire. Their collaboration with National Gas initially focuses on this region.
Electrolytic Hydrogen Generation in Dorset
UKOG also plans an electrolytic hydrogen generation project in central eastern Dorset, connected to a local industrial user that may serve as an offtaker. This facility could tie into a local salt-cavern storage scheme, making it an integrated generation-plus-storage model.
Portland Port MoU
In addition to these, UKEn has signed Memoranda of Understanding with Portland Port. According to UKOG’s half-year report, these MoUs envision:
- Import of green hydrogen carrier liquids into Portland Port.
- On-site electrolytic generation of green hydrogen at Portland, potentially producing up to 1 GW via electrolysis.
- Use of imported hydrogen or locally generated hydrogen to feed into its South Dorset storage site, giving the project national-level importance.
This multi-pronged approach underlines UKOG’s ambition both in hydrogen generation and subterranean storage.
What Do UKOG’s Leaders Say?
Stephen Sanderson, Chief Executive of UKOG, has expressed optimism: following the latest £1 million tranche raised via subscription (at 0.03p per share), he said the company is “in a strong position to advance its full portfolio of hydrogen storage and generation projects towards timely fruition.”
After the £0.52 million placing, Sanderson added:
“We are delighted that this additional funding means the Company has now secured new investment of over £5 million since early October, 2025. Crucially, these funds will assist us in carrying out our currently planned and budgeted 2026 hydrogen storage, hydrogen production and energy-transition activities. The new funding will also help us to deliver a second collaboration with a substantive regional hydrogen pipeline provider, in addition to collaboration with National Gas. These collaborations are both essential steps that will strengthen our intended application for government hydrogen storage revenue support in the coming year.”
How Will the Money Be Managed?
UKOG has set out clear use of proceeds:
- Commissioning engineering concept and design studies for storage and pipeline collaborations.
- Advancing technical and economic modelling for hydrogen production, storage, and the generation project in Dorset.
- Working toward joint applications with pipeline operators under HSBM.
- Exploring a possible strategic joint-venture partner, via economic modelling with sector specialists.
What Are the Strategic Implications?
From a strategic standpoint, UKOG is signaling a decisive shift away from its fossil-fuel roots. Its leadership positions hydrogen storage and generation as central to its future business model. The company is making market moves to capitalise on UK Government hydrogen revenue-support mechanisms, by aligning with pipeline operators and securing early-stage project funding.
Moreover, UKOG’s partnerships such as the MoU with Portland Port indicate a long-term vision for green hydrogen import, local production, and storage. Their work in Dorset and Yorkshire could make UKEn a meaningful player in the UK’s hydrogen transition.
Why Does This Matter for the Energy Transition?
Hydrogen is increasingly viewed as a cornerstone of the UK’s clean energy future, especially for hard-to-decarbonise industries and long-duration storage. By raising capital, commissioning rigorous studies, and forging partnerships ready for HSBM revenue support, UKOG is positioning itself as a serious contender in the hydrogen landscape.
Its salt-cavern storage model is particularly strategic: such storage can act as a buffer, storing hydrogen when supply is high (e.g., from renewables) and releasing it when demand spikes. Coupled with on-site electrolysis, this could create a flexible, synchronous hydrogen system.
What Are the Risks?
- The success of UKOG’s hydrogen ambitions depends heavily on obtaining government revenue support under HSBM. If allocation rounds are delayed, downsized, or reformed, UKOG’s financial projections could be challenged.
- The feasibility studies technical, economic, and design are complex and capital-intensive. There’s always risk in modelling assumptions, cost overruns, or technological setbacks.
- Partnerships (with pipeline providers, local Councils, industrial offtakers) may not always materialise or scale in the way UKOG hopes.
- The hydrogen market is competitive. UKOG must compete with other hydrogen producers, storage operators, and importers.
What’s Next for UKOG?
- Finalise the placing on 27 November 2025, subject to admission to AIM.
- Complete the required engineering and design studies for its Dorset and Yorkshire projects.
- Submit joint applications with pipeline partners for HSBM revenue support in H1 2026.
- Progress the Dorset electrolytic hydrogen generation project, including the study with Dorset Council and potential offtaker.
- Advance its joint-venture discussions with infrastructure and sector specialists for long-term storage projects.