[source: union Jack Oil]

Union Jack Oil plc (UJO ) has released a positive update in respect of ongoing operations at the Wressle hydrocarbon development with flow rates now exceeding over 950 barrels of oil equivalent per day. 

Union Jack holds a 40% economic interest in the Wressle development ("Wressle"), located within licences PEDL180 and PEDL182 in North Lincolnshire, on the Western margin of the Humber Basin. 

The Company has now continued to exceed production expectations since the successful completion of the coiled tubing operations on the 19 August 2021 with instantaneous flow rates in excess of 884 barrels of oil per day ("bopd") along with 480,000 cubic feet of gas (c. 80 barrels of oil equivalent per day). 

These flow rates have been achieved from the Ashover Grit reservoir on a significantly restricted choke setting (30.5/64ths) with high wellhead flowing pressure with Zero formation water as the well continues to clean up. 

Furthermore, the Company has received a revision to the environmental permit, enabling the installation of a combustion plant to facilitate gas to electric generation on site further improving the economics of the operation. 

Since being returned to production on the 19th of August 2021 Wressle generated in excess of 480,000 U.S. dollars in net revenues 

View from VOX 

This is another positive update upgrading flow rates from 500 barrels per day to over 950 barrels per day.  

Even with these excellent flow rates, the full flow potential of the well is still yet to be fully tested due to constraints with the gas handling equipment. 

Analysts at Arden are holding their forecasts at this point until plateau rates are more fully understood, which are currently set at 600 bbl/day, which leaves room for further upgrades if current flow rates are maintained. 

Investors will note the announcement last week that it is considering a potential equity raise to fund the acquisition of a 25% interest in the claymore piper royalty vehicle which the company already holds 2.5%. Whilst it is impossible to predict the outcome of this exercise, it is clear that the Company is making positive moves to become a significant player in the UK E&P sector. 

Shares in UJO have soared over the past thee months from 1.27p to over 1.6p with plenty of room for further appreciation if the pending placing is successful and the flow rates at Wressle remain high. 

Reasons to  UJO

UJO is an onshore oil and gas exploration firm with a focus on drilling, development and investment opportunities in the UK hydrocarbon sector, and currently holds interests in 13 licences in areas including, inter alia, the East Midlands, Humber Basin and East Yorkshire.     

Wressle  

In recent months, Operator, Egdon Resources U.K. Limited, commenced operations to re-complete and reperforate the well located at the Wressle hydrocarbon development site.     

The Ashover Grit reservoir is expected to produce 500 barrels of oil per day at a constrained rate, increasing UJO’s net production by an additional 200 bopd when fully on stream.   

From 19 August 2021 to 9 September 2021, Wressle has contributed approximately US$300,000 net to Union Jack from test production during this short period  

Assuming sustained deliverability, at current production rates Wressle is set to become the second ranked onshore oilfield in the UK next to Wytch Farm  

West Newton  

The UK focused onshore hydrocarbon explorer holds a 16.665% interest in PEDL183, containing the conventional West Newton A-1 discovery well and WNA-2 appraisal well.      

West Newton is located at the heart of the Zero Carbon Humber project area, which aims to promote decarbonising technologies across industrial activities in the wider Humber region.  

North Kelsey  

In recent months, UJO also increased its stake in the North Kelsey project by acquiring an additional 30% from Egdon Resources, taking its stake in the exploration project up to 50%.       

Further financial obligations will be equal between Union Jack and Egdon Resources, in line with both parties’ 50% stake in the North Kelsey Prospect which is located in Lincolnshire.      

The North Kelsey Prospect is a conventional oil prospect along trend from and analogous to the Wressle oil development, which lies around 15 kilometres to the northwest.      

Subject to a successful farm-out, North Kelsey-1 is expected to be drilled during 2021.      

Follow News & Updates from Union Jack Oil plc here: