Egdon Resources (LON:EDR) has started drilling a first exploration well at Laughton in Lincolnshire.
There will be no fracking, Egdon said. with the primary target is a conventional structural trap more than 1,500 metres deep identified by 2D seismic data.
As well as this prospect, two other potential reservoirs, the Kilburn Sandstone and the Wingfield Flags, will also be targeted.
Prospective resources for the three targets are estimated by Egdon to be 1.3 mln barrels of oil.
Union Jack Oil (LON:UJO) can earn a 10% interest in Laughton-1 exploration and two other conventional prospects on the PEDL209 licence in return for paying 16.67% of the cost of the well.
After that Egdon will own 50%, Blackland Park 28%, Stelinmatvic 12% and Union Jack Oil 10%.
Mark Abbott, Egdon’s managing director, said that onshore oil and gas projects remain commercially attractive even during a period of reduced commodity prices and its conventional exploration drilling programme was a key part of its strategy.”