logo-loader

Union Jack's Bramhill flags up potential for further deals

Last updated: 10:59 19 Feb 2013 GMT, First published: 11:59 19 Feb 2013 GMT

no_picture_pai

Entrepreneur David Bramhill marked his return to the oil sector today with the first deal for his ISDX-quoted start-up, Union Jack (ISDX:UJOP).

The group is taking a 10% stake in PEDL 201, an onshore licence in the East Midlands – and Bramhill said it could be one of half a dozen similar farm-in transactions this year.

In acquiring stakes in onshore properties in this way he will be following the blueprint set out in one of his earlier ventures, the highly successful Oil Quest Resources.

“We are looking at onshore UK. If we can get a slice of offshore, then fine,” he explained.

“But at the moment the strategy is very much the strategy of Oil Quest, my old company. “

“We may be bit more selective on the projects: we are only going into a project where we know the work has been done by others and they are good companies – established outfits.”

Earlier, Union Jack said it will pay 10% of the costs of the Wolds-1 well to earn a 5% interest each from partners Egdon Resources (LON:EDR) and Celtique in PEDL 201.

The licence is located in the East Midlands and on the southern margin of the Widmerpool Gulf.

It contains the Burton on the Wolds prospect, which has been mapped using new and reprocessed 2D seismic data.

Drilling operations are planned to commence in “late second quarter”.

Bramhill and his team are focusing on projects where all the mapping has been done, seismic surveys shot, old data re-processed and drill targets chosen.

In other words he is going for licences where much of the exploration costs and, crucially, risks have been taken by other parties.

It is a model that works well for the North Sea, where partners are brought in to share the risk of a project.

“They have got a well they have to drill and companies will farm out. None of them wants to take 100% of the risk,” said Bramhill.

“Our strategy is, by June, to have a portfolio of perhaps half a dozen wells to be drilled over the next year and maybe some development projects where they have found the oil and they are going to bring it into production.

“Those are the deals we are looking for. We pay a promote – a bit more for the well. But then you aren’t paying any back costs and you aren’t paying before you start drilling.

“Leverage from half a dozen of these deals is really good. It is a great business model.”

The name of the group, meanwhile, is pure David Bramhill. He bought the name in the 1980s when a previous Union Jack Oil company was bought alongside its parent Ranger Oil.

“We launched last year – the year of the Jubilee. So I thought it was a fitting name, given the celebrations and all.”

It also suggests the group won’t be drilling too far from its home territories.

Union Jack Oil "in good shape" but frustrated by slow progress

Union Jack Oil PLC (AIM:UJO) executive chair David Bramhill speaks to Thomas Warner from Proactive after the UK-focused onshore oil and gas company released its interim results for the six months to 30 June 2023. Bramhill starts by highlighting the company's rude financial health, describing...

on 11/9/23