Union Jack Oil PLC (AIM:UJO) executive chairman David Bramhill has, in today’s interim report, highlighted important progress made at the company’s three key projects - Wressle, West Newton and Biscathorpe.
The optimisation of production at the Wressle field has been a key recent highlight, with the field performance exceeding expectations following a proppant squeeze programme on the Ashover Grit reservoir.
Presently, rates are in excess of the 500 barrels of oil per day gross production target at Wressle and Union Jack – which owns 40% of the field – sees the asset as being financially transformational for the company should its impressive present cash flow can be sustained.
“If Wressle is only half as good as we anticipate, then we will be hearing much more about this development for many years to come,” David Brahmill said in his statement.
"The revenue potential from Wressle, the royalty stream and our wider appraisal testing and planned drilling activities, all augur well for the execution of our strategy in delivering material growth in the medium term and achieving our goal of building a sustainable, cash generating and profitable, UK onshore focused, mid-tier conventional hydrocarbon producer.”
Union Jack noted that, assuming the performance is sustained, the Wressle field will be the second-ranked onshore oilfield in the UK, after Wytch Farm.
Union Jack noted that in the period between August 19 and September 9, Wressle generated around US$300,000 of net revenue.
It sees considerable further upside via Wressle’s Wingfield Flags and Penistone Flags reservoirs, which flowed oil in testing.
The company said it will commission a leading energy consultancy to prepare an updated Competent Persons Report for the Wressle development.
During the first half, the company has also actively advanced the West Newton and Biscathorpe projects – with the testing of a well presently underway for the former and, following the acquisition of an increased interest in the latter, work is presently ongoing ahead of new side-track well in 2022.
“Developments at our three material projects where we have meaningful economic interests have generated a steady stream of encouraging news flow, which we expect will be continued based on current activities," Bramhill said.
He added: “The board remains both confident and optimistic and the future of Union Jack remains bright."