Union Jack Oil plc (UJO) today said it now held 45% interest in the Biscathorpe joint venture project PEDL253 after buying a 15% stake from Humber Oil & Gas for £1 million.
TERMS
Other shareholders of the licence include operator Egdon Resources UK Ltd with 35.8% and Montrose Industries Ltd 19.2%.
UJO will pay £500,000 on Oil and Gas Authority (OGA) approval.
A further £500,000 will be paid to Humber following planning approval from Lincolnshire County Council for the side-track drilling operation, associated testing and approval to undertake long-term production of hydrocarbons in a successful drilling case.
The money will come from UJO’s existing cash balance and the transaction will be effective from 1 January 2021.
OIL RESERVES
Last month, Egdon announced it intended to submit a planning application for a new oil well at the site before the end of February 2021.
PEDL253 lies within the hydrocarbon fairway of the Humber Basin, on trend with the Keddington oilfield (Union Jack 55%) which produces oil from a Carboniferous Westphalian aged reservoir.
UJO said that an independent petrophysical analysis and oil samples from cuttings have confirmed oil bearing Dinantian Carbonate reservoir of 57 metres.
Dinantian oil play has gross Mean STOIIP of 24.3 million barrels of oil (mmbo) with an upside case of 36 mmbo.
The company added that there was evidence for a thickened Westphalian sandstone interval with associated gross mean prospective resources total 3.95 mmbo with an upside case of 6.69 mmbo.
Executive chairman David Bramhill added that extensive technical analyses of the site had materially upgraded the resource potential and economic value of the project which remained one of the UK’s largest onshore un-appraised conventional hydrocarbon licences.