Extractive Industries

Union Jack increases Oklahoma interests

Union Jack Oil plc today confirmed two commercial successes and expansion of its onshore portfolio in Oklahoma, USA.

Income: mineral royalty investments of proxy interests in 165 wells (Pixabay)

ANDREWS

Spud in March and targeting the Hunton Limestone, Andrews 1-17 in Seminole County underwent restricted and periodic test production during late May 2024.

The company said that the well had since produced 6,460 barrels of high-quality, ultra-light oil with a gravity of approximately 46 degrees API and 382,000 cubic feet of gas.

Following connection to a gas pipeline, gas has been sold to the market.

Water produced from the well will be transported 2km via a recently laid pipeline to the Coker injector well to rebuild reservoir pressure in the Rogers and S&M production wells, the company’s Rogers secondary recovery project.

The Andrews 2-17 well spud in July and completed in early August.

The well is on test production with “free flowing high-quality, ultra-light 46 degrees API gravity oil, significantly with no water”.

Since restricted and periodic test production from 7 August, Andrews 2-17 has produced 544 barrels of oil and 1,895,000 cf of gas, with first oil and gas sold to the market.

Work continues to reach optimum production on both wells, with rates currently variable until a stable flow rate is established.

Union Jack has a 45% working interest in both wells and paid drilling and completion costs from its cash resources.

ACQUISITIONS

The company’s expansion in the United States includes a 45% farm-in of the back-to-back Taylor well also in Seminole County and Moccasin in Pottawatomie County, to be drilled during Q4 2024.

Acquired from operator Reach Oil & Gas Inc, Taylor is an untested 3D seismic supported “Hunton Remnant prospect” with secondary targets in the Misener and Wilcox sands.

The acreage includes the “Taylor Hunton prospect, two Wilcox structures and Misener field with a possible infill location”.

Union Jack has paid $309,000 planning and back costs to Reach while drilling and well completion costs are estimated at approximately $516,000 net.

Untested Moccasin is a 3D seismic supported Hunton and Wilcox structure with secondary targets in Pennsylvanian Channel Sands and Base Pennsylvanian Unconformity Sand.

The structure lies close to the Woodford Shale, the main source for light oil across the region.

Union Jack has paid planning and back costs of $256,000 with drilling and completion of the well estimated to be $600,000 net.

The Moccasin structure is a compressive feature associated with the regional Wilzetta fault, responsible for “several large oil accumulations”. 

Union Jack has acquired a 75% in the Wilzetta Diana-1 Footwall Fold drill testing project, to begin after Taylor and Moccasin.

The deeper structure, underlying the main Wilzetta Fault zone target, will also undergo testing with a high-impact well for estimated recoverable oil in excess of 200,000 bbls

The company said that the prolific Wilzetta Fault plays held “numerous” oilfields across central Oklahoma.

SEISMIC

Union Jack additionally has a 37.5% interest in the East Shawnee 3D seismic acquisition programme, designed to identify further prospects for 2025 drilling along the Wilzetta Fault, also known as the Seminole Uplift.

The North-East Shawnee and North-West Redhill fields, that have produced more than 6,000,000 barrels of oil, lie in the area of the Moccasin well.

Reach is currently completing permitting before beginning seismic acquisition in early October 2024.

Executive chairman David Bramhill added: “Obviously I am delighted at the initial success and significant progress being made in the USA alongside our partners, Reach.

“It is difficult to believe that our entry into North America at the start of the year would yield such material returns in such a short period of time.

“The hydrocarbon opportunities in Oklahoma are considerable and we look forward to drilling the Taylor and Moccasin wells during Q4 2024, followed by the Diana-1 well, all of which hold considerable upside on success.”

He said that Union Jack remained committed to all its current UK projects.

The company’s mineral royalty investments of proxy interests in 165 wells are also delivering a “consistent, safe and attractive” income stream with returns to date equal to more than 20%.

In early April, Union Jack appointed investor relations group Harbor Access and Lighthouse Equity Research to provide equity research coverage of Union Jack in the USA.

The company intends to appoint a USA-based stockbroker this year.

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