The Directors of Union Jack Oil plc (AIM: UJO) are pleased to announce that the Company has received written consent from the Oil and Gas Authority, satisfied all conditions precedent, and has now completed the Farm-in with Rathlin Energy (UK) Limited for a 16.665% licence interest in PEDL183, containing the significant West Newton A-1 UK onshore gas discovery.
· Best Estimate Contingent Resources of 189 Bcf of gas equivalent or 31.5 million barrels of oil equivalent (gross) assigned to the West Newton A-1 discovery in a Competent Persons Report
· Drill-ready conventional appraisal well planned to be drilled in Q1 2019 and fully funded from existing cash resources
· Operator’s NPV10% of US$247 million and 52.5% ROR for the gas discovery alone
· Attractive acquisition metrics of less than US$0.30 per barrel of oil equivalent for the gas discovery alone
· Considerable upside potential from the lower Cadeby Reef oil exploration target underlying the gas reservoir that will also be drilled, with Best Estimate Prospective Resources of 79.1 million boe (gross)
David Bramhill, Executive Chairman of Union Jack, commented:
“We are pleased to complete the Farm-in to PEDL183, containing the material West Newton gas discovery that represents a significant and compelling project for Union Jack.
“The drilling of the West Newton conventional appraisal well is currently planned for Q1 2019 and will follow the planned commencement of drilling of the conventional Biscathorpe-2 appraisal well on PEDL253 by year end 2018 in which Union Jack holds a meaningful 22% licence interest. Both wells are fully permitted and success at either would deliver a material onshore gas or oil development project respectively, with either being transformational for Union Jack.
“The completion of the West Newton Farm-in puts Union Jack in a stronger position to deliver growth in reserves, production and asset value while adhering to our principles of strict financial and technical disciplines.
“We look forward to keeping the market updated on the impending commencement of drilling of the high-impact appraisal wells at Biscathorpe-2 and at West Newton.”