The UK oil and gas exploration company Corallian Energy says it has found "substantial oil reserves” beneath the Dorset coastal site.
The firm began assessing the area – known as the Colter Prospect – within the bay in February.
After originally missing its intended geological target, the team unexpectedly discovered extensive reserves of oil close by.
Corallian's partner firm United Oil & Gas says the discovery of the new reserve – which it has named Colter South – is "fantastic" because more than 15 million barrels of oil could eventually be recovered from the area.
"Anything above four million barrels would be a huge success for our shareholders," says United Oil & Gas’s chief executive Brian Larking, adding that a third local area is also now being investigated.
Reabold Resources – which owns 32 per cent of Corallian Energy – said in a statement: “The location and nature of the asset will result in highly attractive economics, with low development costs, fast payback, and a very low oil price breakeven.”
Corallian is preparing to drill an angled well towards the northern side of the field in anticipation of a successful licence application to the Department for Business, Energy and Industrial Strategy.