TIDMUJO
RNS Number : 1114Z
Union Jack Oil PLC
29 August 2018
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement
29 August 2018
Union Jack Oil plc
("Union Jack" or the "Company")
Biscathorpe Drilling Timetable and Update
Union Jack Oil plc (AIM: UJO), a UK-focused onshore hydrocarbon
production, development and exploration company is pleased to
announce that well-site construction will be completed during
September 2018, followed by the drilling of the Biscathorpe-2
conventional well in October/November 2018. Union Jack holds a 22%
interest in Licence PEDL253 containing the Biscathorpe
Prospect.
Highlights
-- Site construction to be completed during September 2018 and
drilling scheduled to commence in October/November 2018
-- Tenders for materials and services currently being updated
-- Biscathorpe-2 well will evaluate the Biscathorpe-1 discovery made by BP in 1987
-- Mean prospective resources estimated at 14.00 MMbbl gross
(3.1 MMbbl net to UJO) with 40% geological chance of success
-- Planning and Environment Agency permits in place
-- Operations at the site will not involve fracking for shale gas or shale oil
David Bramhill, Executive Chairman of Union Jack, commented:
"Biscathorpe is one of the UK's largest onshore conventional oil
prospects with Mean Prospective Resources of 3.1 million barrels
net to Union Jack and a high geological chance of success of
40%.
"The Company`s economic modelling of the Biscathorpe Prospect
highlights its attractiveness and shows a pre-drill value for the
success case of circa GBP24 million net to Union Jack (using the
industry standard net present value after tax at a 10% discount
rate).
"Six months on from entering into a Commercial Partnership with
Humber Oil & Gas Limited ("Humber") we have worked together to
identify and acquire jointly, several licence interests in what we
consider to be potentially high yielding projects. We are
optimistic about drilling Biscathorpe-2, which represents the first
well drilled in conjunction with Humber.
"We would also like to take this opportunity to emphasise that
Biscathorpe-2 is a conventional well and will not, either now or in
the future, involve any fracking.
"Biscathorpe is material to Union Jack and has the ability to
transform our Company into a significant UK oil producer. We are
delighted that guidance on the drilling timetable has been issued
and we look forward to keeping the market apprised of further
developments."
The Biscathorpe-2 Conventional Well
The Biscathorpe-2 conventional well site is located within
PEDL253 on the proven hydrocarbon fairway of the South Humber
Basin, on trend with the Saltfleetby gas field, the producing
Keddington Oilfield (Union Jack 20%) and the Louth and North
Somercotes prospects.
The Biscathorpe-2 well will be located in a direction towards a
potentially thicker sand development within the structural closure
of the trap. The latest forecast Mean Prospective Resource is 14
million barrels of oil (gross) with a geological chance of success
of 40%.
Tenders for all materials, services and a drilling rig are
currently being updated with a view to completing well site
construction during September 2018 and commencing drilling
operations in October/November 2018.
The drilling of the Biscathorpe-2 well will evaluate the
Biscathorpe-1 conventional oil discovery made by BP in 1987. This
well encountered an oil filled sandstone which is expected to
thicken down-dip.
The Biscathorpe Prospect is a well-defined four-way dip closed
structure mapped from modern re-processed 3D seismic.
In May 2018, Lincolnshire County Council ("LCC") Planning
Committee unanimously granted an extension to the existing planning
consent to drill a conventional resource exploration well at
Biscathorpe.
The joint venture participants in Biscathorpe have been made
aware that LCC has been challenged by an objector in respect of the
legality of their planning decisions. No impact to the timing of
operations at Biscathorpe is anticipated at this moment in time,
however, the situation will be kept under ongoing review.
The Oil and Gas Authority ("OGA") has also granted an extension
for PEDL253 until 30 June 2020.
The Biscathorpe-2 conventional well will involve drilling for
oil trapped in a sandstone reservoir and for clarity the operations
at the site will not either now or in the future involve the
process of hydraulic fracturing "fracking" for shale gas or shale
oil.
Licence Interests in PEDL253
Egdon Resources UK Limited
(Operator) 35.80%
Montrose Industries Limited 22.20%
-------
Union Jack Oil Plc 22.00%
-------
Humber Oil & Gas Limited 20.00%
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In accordance with the "AIM Rules - Note for Mining and Oil and
Gas Companies", the information contained within this announcement
has been reviewed by Graham Bull, Non-Executive Director, who has
over 46 years of international oil and gas industry exploration
experience.
For further information please contact the following:
Union Jack Oil plc +44 (0)7787 160 682
David Bramhill
SP Angel Corporate Finance LLP +44 (0)20 3470 0470
Nominated Adviser
Lindsay Mair
Richard Hail
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END
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