Union Jack Oil PLC (AIM:UJO, OTCQB:UJOGF) has announced a commercial discovery at the Moccasin 1-13 well, in Oklahoma, with early results driving confidence.
The well, 45%-owned by Union Jack, has hit several hydrocarbon-bearing intervals, with the primary target now perforated and indicating potential for significant oil production.
Union Jack and partner Reach Oil & Gas have begun installing permanent production facilities at the site, meanwhile, testing is ongoing - with two more zones scheduled for perforation and evaluation.
"Moccasin has more than validated Management's confidence in its success, being a further commercial discovery in Oklahoma for Union Jack,” executive chair David Bramhill said in a statement.
“Testing at Moccasin is ongoing, however, Union Jack and Reach are sufficiently confident of the results to date and the Joint Venture has commenced the installation of permanent production facilities.”
Bramhill added: “Although further testing is required, early indications suggest that Moccasin could provide material cash-flow going forward, contributing to the expansion of revenues from the Andrews Field and Mineral royalty portfolio in the USA, a country that offers fair, attractive and balanced fiscal terms.”
The Union Jack highlighted that Moccasin provided a ‘proof of concept’ that oil occurs in structures to the west of the prolific Wilzetta fault, and, as such, the well opens up further opportunity.
It is the latest success for the small-cap oil in Oklahoma, after it embarked upon a diversification into the United States in addition to its assets onshore UK.
"Progress in Oklahoma by the Company is highly satisfactory, emphasising the positivity and encouragement given to industry entrepreneurs,” Bramhill said today.
"We look forward to reporting further results from Moccasin on completion of testing and the installation of permanent production facilities, expected during Q1 2025."
Union Jack noted that all drill and completion costs at Moccasin were covered by its existing cash resources.