UK Oil & Gas (UKOG), the company behind the plan to extract oil from the Gatwick area, says oil has flowed to the surface at a faster rate than expected.
UKOG said light sweet oil rose from 900 metres below ground level at a rate of 463 barrels per day.
Its shares rose 38% to 1.9p following the flow test at the Horse Hill site in the Weald basin, West Sussex.
Executive chairman Stephen Sanderson said the test was significant.
"Importantly, tests so far show oil has flowed to the surface under its own pressure and has not, so far, required artificial lift," he said.
The company says it could produce up to 500 barrels of oil a day.
According to Mr Sanderson, additional extraction techniques could further increase flow rates.
David Lenigas, the former chairman of UKOG, had claimed that there could "multiple billion" barrels of oil across the Weald, which stretches across the South East corner of England.
It was originally suggested there could be as much as 100 billion barrels of oil in that region.
However, the most recent assessment by Schlumberger, the oil services company, predicted there were 10.9 billion barrels of oil in the 55 square mile area covered by UKOG's licences.
UKOG has a 30% direct investment in Horse Hill Developments, which is drilling the site.
Some environmental groups say that getting what oil there is there could prove tricky and is only possible through fracking, a controversial extraction method for oil and gas.
Protestors gathered at the Horse Hill site last Saturday to demonstrate against the use of fracking.
UKOG has said that it does not intend to use fracking to extract the oil.