TIDMUJO TIDMUJOP
RNS Number : 7436P
Union Jack Oil PLC
22 November 2016
UNION JACK OIL PLC
(AIM: UJO)
Completion of Acquisition of Additional Interest in PEDL180 and
PEDL182 Including the Wressle-1 Discovery and Broughton North
Prospect, onshore UK
Further to the announcement of 27 September 2016, Union Jack Oil
plc ("Union Jack" or the "Company"), an onshore oil and gas
production and exploration company with a focus on production,
exploration development and investment in the United Kingdom
hydrocarbon sector, is pleased to announce that the Oil and Gas
Authority ("OGA") has now approved the acquisition by Union Jack of
a further 3.34% interest in PEDL180 and PEDL182 from Europa Oil
& Gas Limited. These licences contain the Broughton North
Prospect situated in PEDL182 and the Wressle-1 discovery well from
which first commercial oil is expected to flow at an estimated
constrained rate of 500 barrels of oil per day gross in early
2017.
Union Jack now holds an 11.67% interest in both licences
following completion of this transaction.
The consideration for the acquisition was GBP600,000
("Consideration") for the additional 3.34% economic interest.
The Company`s cash balance following payment of the
Consideration is approximately GBP2,000,000 and the Company is
fully funded for its other committed projects including the
drill-ready Holmwood-1 and Biscathorpe-2 conventional wells and
ongoing development costs for Wressle-1 and remains debt free.
The interests held in both PEDL180 and PEDL182 are:
Egdon Resources U.K. Limited
(Operator) 25.00%
------------------------------ -------
Celtique Energie Petroleum
Limited 33.33%
------------------------------ -------
Europa Oil & Gas Limited 30.00%
------------------------------ -------
Union Jack Oil plc 11.67%
------------------------------ -------
David Bramhill, Executive Chairman of Union Jack, commented: "We
are delighted to be able to confirm the increase in our position in
Wressle, an attractive near term production asset where first
commercial oil is expected to flow at an estimated constrained rate
of 500 barrels of oil per day gross in early 2017, as well as
providing Union Jack with further exposure to the promising
Broughton North Prospect.
The future looks bright for this project given the early 2017
production target and the additional potential for
multi-development opportunities we see within PEDL180 and 182."
The Wressle-1 Discovery
The Wressle-1 oil and gas discovery is located within PEDL180
and PEDL182, in Lincolnshire, on the western margin of the Humber
Basin.
On Extended Well Test the well flowed an aggregate of 710
barrels of oil equivalent per day over three horizons, the Ashover
Grit, Wingfield Flags and the Penistone Flags.
The summary details of a Competent Persons Report ("CPR")
compiled by ERC Equipoise Limited were published by Union Jack and
its partners in respect of Wressle and the Broughton North Prospect
on 26 September 2016.
The oil and gas Reserves and Contingent Resources identified by
the CPR in aggregate exceed the Operator`s original pre-drill
estimates.
Gross P Mean Discovered Oil Initially in Place is 14.18 million
stock tank barrels in aggregate across three reservoir sands, the
Ashover Grit, Wingfield Flags and Penistone Flags, of which 2.15
million gross stock tank barrels of oil are classified as
discovered (2P+2C).
Gross 2P oil Reserves of 0.62 million stock tank barrels of oil
in aggregate identified across two reservoir sands, the Ashover
Grit and the Wingfield Flags that form the basis of the initial
development plan which currently excludes development of the
material Penistone Flags reservoir sands.
The initial development plan utilising the Wressle-1 discovery
well has been submitted to the Oil and Gas Authority and for which
a planning application is currently being considered by the North
Lincolnshire Council.
Substantial Contingent Resources have also been confirmed in the
Penistone Flags reservoir that are over and above the oil and gas
Reserves identified in the Ashover Grit and Wingfield Flags
reservoirs.
The Penistone Flags reservoir has gross 2C Contingent Resources
of 1.53 million stock barrels of oil and 2.0 billion standard cubic
feet of gas.
The conversion of the Penistone Flags 2C Contingent Resources
into 2P Reserves, in full or in part, is expected to occur
following receipt of necessary development approvals and commencing
production at the Wressle development and once a subsequent
development plan has been identified for the Penistone Flags
Reservoir.
Development options and production planning for the Penistone
Flags reservoir are expected to progress following commissioning of
the initial Wressle development and will include monetisation of
the produced gas by pipeline or electricity generation which will
be sold to the National Grid.
The Broughton North Prospect
The Broughton North Prospect is located in a fault block
immediately to the north west of the Wressle structure within
PEDL182 and ERCE has attributed a high geological chance of success
of 40% to 49% to the prospect.
Gross unrisked Mean Oil Initially in Place for the Broughton
North Prospect is an undiscovered 3.43 million stock tank barrels
of oil in aggregate across two reservoir sands, the Ashover Grit
and Penistone Flags with Mean Prospective Resources of 0.51 million
stock tank barrels of oil plus 0.51 billion standard cubic feet of
gas.
Mapping of the Broughton North Prospect also benefits from the
same high quality 3D data set as was used to identify the Wressle-1
oil and gas discovery.
Funding for an exploration well on the prospect will be assisted
by the significant net cash flows expected to be generated from
commercial production from the initial Wressle development.
Net Volumes
Gross attributable
Volumes to Union Jack
Oil Oil
Oil Gas Equiv Oil Gas Equiv
MMstb bcf MMboe MMstb bcf MMboe
------------------ ------------------- ---------- ----------- ------------------- ------------------ -----------
2P Ashover Grit
and Wingfield
Flags 0.62 0.20 0.65 0.05 0.02 0.05
2C Penistone
Flags 1.53 2.00 1.86 0.13 0.17 0.16
Broughton North
Mean Unrisked
Prospective
Resources 0.51 0.51 0.60 0.04 0.04 0.05
------------------ ------------------- ---------- ----------- ------------------- ------------------ -----------
Gas converted to oil equivalent using 6 Bscf/MMboe conversion
and added to oil volume
Net Volumes of hydrocarbons attributable to Union Jack
pre-acquisition
Net Volumes
attributable
Gross to Union Jack
Volumes Post-acquisition
Oil Oil
Oil Gas Equiv Oil Gas Equiv
MMstb bcf MMboe MMstb bcf MMboe
------------------ ------------------- ---------- ----------- ------------------- ------------------ -----------
2P Ashover Grit
and Wingfield
Flags 0.62 0.20 0.65 0.07 0.02 0.07
2C Penistone
Flags 1.53 2.00 1.86 0.18 0.24 0.22
Broughton North
Mean Unrisked
Prospective
Resources 0.51 0.51 0.60 0.06 0.06 0.07
------------------ ------------------- ---------- ----------- ------------------- ------------------ -----------
Gas converted to oil equivalent using 6 Bscf/MMboe conversion
added to oil volume
Net Volumes of hydrocarbons attributable to Union Jack
post-acquisition
For further information, please contact:
Union Jack Oil plc
David Bramhill +44 (0) 77871 60682
Shore Capital
Nominated Adviser
Edward Mansfield
Anita Ghanekar
Corporate Broking
Jerry Keen +44 (0) 20 7408 4090
SP Angel
Joint Broker
Richard Hail +44 (0) 20 3470 0470
Yellow Jersey PR
Limited
Public Relations
Dominic Barretto +44 (0) 7768 537 739
In accordance with the "AIM Rules - Note for Mining and Oil and
Gas Companies", the information contained within the announcement
has been reviewed and signed off by Graham Bull, Non-Executive
Director, who has over 46 years of international oil and gas
industry exploration experience.
ERCE have carried out their work using the March 2007
SPE/WPC/AAPG/SPEE Petroleum Resources Management System (PRMS) as
the standard for classification and reporting. The extracts of the
report shown above are compliant with the AIM Rules - Note for
Mining and Oil and Gas Companies.
ERCE`s summary of the findings of their CPR including the
definition of the terms used in this announcement can be found on
the Company`s website www.unionjackoil.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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