Union Jack Oil PLC (AIM:UJO, OTCQB:UJOGF) told investors that its Taylor-1 well in Seminole County, Oklahoma, is expected to spud later this week – on or around October 31.
The Taylor-1 well will target an untested prospect identified in 3D seismic.
It will primarily assess a Hunton Remnant prospect plus secondary targets in the Wilcox sands, which have a strong record of oil production in the region.
Estimates put the geological chance of success at around 40%, Union Jack noted.
Union Jack holds a 45% working interest in Taylor-1, and the well is operated by its partner Reach Oil and Gas.
"The management decision in late 2023, to focus on opportunities in the USA has already delivered rewards in a short period and I am pleased to report the imminent spudding of the Taylor well that has a good chance of success,” executive chair David Bramhill said in a statement.
"One year on, our entry into the USA is already generating cash flow from the Andrews field and Mineral royalty portfolio where returns of 20%+ are being seen in respect of our original capital investment.
"The successful, now predominantly gas-producing Andrews 1-17 and 2-17 wells, forming the Andrews field, in which Union Jack hold a 45% working interest, have to date produced 8,765 barrels of oil and 20,221,000 cubic feet of gas.
After Taylor-1 well, the partners plan to follow with the drilling of the Moccasin well, which will similarly target the Hunton and Wilcox formations.
Funding for drilling operations will come from Union Jack’s existing cash resources.
Meanwhile, Bramhill added: "In the UK, the company is pleased to report cumulative revenues of over US$21,000,000 from Wressle, net to its 40% interest, where the view of management is that the most productive phase of development awaits.
"Also in the UK, ongoing site improvements to the Keddington production asset, where Union Jack holds a 55% interest, are progressing well and production is expected to re-commence during late 2024.
"Despite the current fiscal uncertainty that overshadows the UK upstream, Union Jack remains profitable and the board is committed to delivering on its stated growth strategy in both the USA and UK."