UK Oil & Gas plc (UKOG) said it would need to raise further funds for its joint venture (JV) partner to shoot further unbudgeted seismic at the the Basur-1 oil discovery on the Resan licence in Türkiye.
FINANCES
UKOG added that a longer-than-expected seismic acquisition period over winter had also required additional previously unbudgeted working capital and deferred the start of the anticipated cash flow from a successful Basur well.
“The company will, therefore, need to seek further finance before mid-Q4 2022 to fund this planned programme and for general working capital purposes,” said UKOG in a statement.
“Success at Basur is anticipated to provide additional working capital to help fund UKOG’s other significant projects which, by their nature, have a longer lead time to cash generation.”
UKOG said that its focus for the next six to nine months will be on delivering Phase II seismic and a new Basur appraisal well.
The well is anticipated to add near-term oil production to the company in H1 2023, subject to necessary funding.
The Resan licence is a 50-50 JV between the company and operator Aladdin Middle East (AME).
PROSPECT B
The news comes as the company also announced that further examination of seismic data had revealed an additional “potentially significant undrilled geological structure” to the south of Basur-1.
UKOG added that the structure, currently known as Prospect B, showed the same geological structural style as the Basur discovery.
“It appears to be of similar size to Basur upon first review,” said the company.
“Further phase 2 seismic lines to the west will be required to confirm its size, prospective resource hydrocarbon volume, and to help define any future exploration well location.”
OIL SAMPLING
UKOG added that AME has conducted additional recent oil sampling at the live light 42˚ API oil seep, north of the Basur oil discovery, which appeared to be continuous.
The company anticipates that a new Phase II seismic line will pass over the seep to help identify whether it derives from a previously unrecognised deeper Mardin/Garzan age oil accumulation.
DRILLING
UKOG’s technical team will also help progress Basur towards drilling by spending next week in the field.
Team members will scout a potential new Basur-4 location, tie Basur seismic work into surface geology and investigate whether Prospect B has any surface geological expression that can help define its extent.