Jersey Oil and Gas PLC (AIM:JOG) shares shot up in early deals after it said its Greater Buchan Area (GBA) farm-out is generating widespread interest.
Initial engagement and screening have led to Jersey Oil being actively engaged with multiple serious counterparties of scale, with ongoing due diligence involving two-way collaborative workstreams.
Work is progressing to assess various development concepts that can facilitate the farm-out, including using existing third-party host infrastructure and facilities to enhance overall development economics through synergies and cost savings, the North Sea oil company said.
Progressing the development of the GBA project remains the company’s number one priority, the company said in its results statement covering 2021.
The company said it remains well funded with cash at the end of 2021 standing at around £13mln. Most of the company’s current expenditure budget is focused on workstreams that will facilitate securing a successful farm-out of GBA.
The pre-revenue company made a loss before tax of £4.23mln versus a loss of £2.78mln the year before as administrative expenses rose to £3.67mln from £2.11mln.
Jersey Oil and Gas full year 2021 results and farm out update. Please see Arden’s note on the portal: https://t.co/9TyOGJiEdu #JOG @Jerseyoilandgas
Disclaimer: https://t.co/tEvMNbOXEr
— Arden Partners (AIM:ARDN) plc (@Arden_Partners) April 28, 2022
"2021 was an active and exciting year for the company, most notably involving the commencement of our Greater Buchan Area farm-out process. Interest in developing the GBA has been strong and we are actively engaged with multiple serious counterparties. Since launching the process our engagement strategy has been broadened to advance a range of competing development solutions, providing increased optionality,” said Andrew Benitz, the chief executive officer of Jersey Oil & Gas.
"The GBA is a high-quality, development ready UK North Sea resource base of scale and we look forward to concluding the farm-out process and moving into the next phase of activities. The company remains well funded as we progress at pace to deliver stakeholder value through securing a successful farm-out to ensure this exciting project can be developed in the most economic and sustainable manner," he added.
Shares in Jersey Oil were up 9.7% at 187.5p in the first hour of trading and are up by a third year-to-date.