Union Jack flies the flag for UK onshore oil and gas
The directors of Union Jack Oil (UJO:AIM)
see the United Kingdom onshore as being an attractive target for investment in hydrocarbon projects where the company is active in a reasonably lowcost operating environment and where the licensing regime is fully transparent.
The board of directors are all very experienced in the oil sector and have been involved for decades in the development and corporate activity in respect of several energy companies, particularly within the UK onshore arena.
Union Jack has adopted a low cost, non-operating business model, typically acquiring interests in late stage projects, thus minimising risk and cost exposure to individual wells which are considered to have excellent scope with the drill bit for future discoveries, the Biscathorpe-2 and West Newton appraisal wells planned to be drilled Q1 2019 being prime examples.
The company has acquired interests in 13 licences located in the East Midlands, Southern Zechstein and the Weald Basins, all being established hydrocarbon producing provinces. • PEDL180 and PEDL182 Wressle and Broughton North 27.5% interest • PEDL183 West Newton gas discovery 16.66% interest • PEDL005(R) Keddington oilfield 20% interest • EXL294 Fiskerton Airfield oilfield 20% interest • PEDL181 Humber Basin 12.5% interest
• PEDL143 Weald Basin 7.5% interest • PEDL253 Biscathorpe 22% interest
• PEDL241 North Kelsey 20% interest
INTRODUCING… UNION JACK OIL an AIM-quoted oil and gas production and exploration company with a focus on opportunities within the United Kingdom onshore hydrocarbon sector
• PEDL201 Widmerpool Gulf 26.25% interest • PEDL209 Laughton
• PEDL118 Dukes Wood 16.67% interest • PEDL203 Kirklington 16.67% interest
The East Midlands, Southern Zechstein and Weald Basins are proven to have all the elements of commercial systems, a source rock with sufficient organic content, maturity, a viable migration path, a reservoir and trap formation.
During 2018 the company was on the acquisition trail and interests in additional and existing projects were purchased including an additional 12.5% of the Wressle discovery, awaiting development planning, a further 10% of PEDL253 where the Biscathorpe-2 appraisal well will be drilled in early January 2019 and a 16.665% interest in PEDL183 which holds the significant West Newton A-1 gas discovery planned to be appraised in Q1 2019.
During March 2018 Union Jack formed a commercial partnership with UK based Humber Oil & Gas Limited
and since that time has established an excellent relationship going forward with the joint acquisition of interests in several high impact projects.
WEST NEWTON GAS DISCOVERY
The acquisition of a 16.665% interest in PEDL183 containing the significant West Newton A-1 onshore gas discovery from Rathlin Energy (UK) Limited brought compelling immediate and future economic value to Union Jack in respect of the best estimate contingent resources of 189 billion cubic feet of gas equivalent gross, assigned to West Newton in a Competent Persons Report.
The West Newton A-1 gas discovery is on trend with the prolific offshore Hewlett gas complex and is in close proximity to existing gas pipelines and other infrastructure.
A well is planned to be drilled during Q1 2109 to appraise the conventional discovery.
In addition, a further oil prospect below the gas reservoir, the lower Cadeby reef exploration target with Best Estimate Prospective Resources of 79.1 million barrels (gross) will be penetrated.
BISCATHORPE-2 APPRAISAL WELL
Biscathorpe is one of the UK`s largest onshore conventional oil prospects with Mean Prospective Resources of 14 million barrels gross and a geological chance of success of 40%. Union Jack holds a meaningful 22% licence interest.
The company`s economic modelling of the Biscathorpe prospect highlights its attractiveness and shows a pre-drill value for a success case of circa £24m net to Union Jack.
Following completion of site construction in December 2018 the drill rig is expected to be mobilised in early January 2019.
Biscathorpe is one of Union Jack`s near term high impact projects where a successful outcome could be transformational.
NEWS FLOW THROUGHOUT 2019
The company has a balanced portfolio of production, development and drill-ready projects which includes the fully funded Biscathorpe-2 conventional appraisal well where drill-pad construction work is at an advanced stage and drilling is planned to commence in January 2019 and an appraisal well at West Newton to test the significant West Newton A-1 discovery is planned to be drilled in Q1 2019.
Administrative and general costs are low, and the company remains debt free and has in excess of £2m in cash.
The company`s strategy of focusing on conventional relatively low risk and lowcost onshore production, development and exploration drilling, avoiding early stage and frontier projects is already showing signs of coming to fruition and allows an opportunity for investors to become involved at the end of the exploration and beginning of development cycles in a company likely to generate plenty of news flow throughout 2019.