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Energy

Statoil farm-out and well promise are the highlights of Jersey Oil & Gas’s results for a ‘transformational’ year

The farm-out deal saw the AIM quoted explorer retain an 18% stake in the project, and Statoil commit to pay Jersey’s share of drilling costs, up to US$25mln on the first well.

The focus was on the near future as Jersey Oil & Gas Plc (LON:JOG) released its financial results statement for 2016, with the North Sea explorer looking forward to summer drilling.

Partnered with Statoil the company will be part of a high impact exploration programme, to test the Verbier prospect which has the potential to contain some 162mln barrels of oil.

A separate exploration project is also planned later this year, alongside Azinor, testing the Partridge prospect.

WATCH: "Another transformational year", says Jersey Oil & Gas finance chief

Jersey also highlighted that it continues to ‘work actively’ on several possible acquisitions, whilst at the same time talks are ongoing with a major bank and potential funding partners which may support deals.

Recapping the activities of last year, meanwhile, chief executive Andrew Benitz said: "2016 has been another transformational year for Jersey Oil and Gas, during which we have achieved what we believe to be the first promoted farm-out of an exploration licence in the UK North Sea in over two years.”

He added: “We have only recently started on JOG's journey and I believe that our team, supported by our shareholders, is capable of developing the Company much further from where we are today."

Statoil will cover Jersery for Verbier costs

The farm-out deal with Statoil was the company’s key milestone achievement in 2016. It saw the AIM quoted explorer retain an 18% stake in the project, and Statoil commit to pay Jersey’s share of drilling costs, up to US$25mln on the first well.

Jersey raised £1.6mln of new capital during the year, and ended December with £1.9mln of cash.

It reported a £793,439 pre-tax loss for the year, down for £1.4mln in the previous year.

The company highlighted that it continues to keep tight control of costs, noting that staff agreed to salary cuts of up to 50% for nine months of the year (albeit normal salary levels have since been restored).

It plans to re-open a London office when circumstances allow and in the meantime continue to operate out of its office in Jersey.

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