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DJ Union Jack Oil Plc Farm-In to Licences PEDL253 and PEDL241

 
TIDMUJOP 
 
5 March 2013 
 
                              UNION JACK OIL PLC 
                        ("Union Jack" or the "Company") 
 
                          (ISDX Growth Market: UJOP) 
 
Farm- In to Petroleum Exploration and Development Licences PEDL253 and PEDL241 
 
  Option Agreement Signed to Acquire Interest in PEDL005R (part) and Further 
                              Interest in PEDL241 
 
Union Jack, the hydrocarbon exploration company, is pleased to announce that the 
Company is continuing to build its portfolio by the addition of two new assets. 
 
Farm- In agreements have been executed to  acquire  a  6%  interest  from  Egdon 
Resources U.K. Limited ("Egdon") and a  4%  interest  from  Montrose  Industries 
Limited ("Montrose"),  in  onshore  UK  Petroleum  Exploration  and  Development 
Licence PEDL 253, containing the Biscathorpe  Prospect  and  a  10% interest  in 
PEDL241, containing the North Kelsey Prospect, from Egdon. 
 
In addition, an option agreement has been signed with Egdon, whereby Union  Jack 
has the right to acquire a 10% interest  in  Licence PEDL005R,  limited  to  the 
North Somercotes Prospect and a further 5% interest in PEDL241. 
 
These transactions are subject to approval from the  Department  of  Energy  and 
Climate Change. 
 
Farm-In to PEDL253 
 
PEDL253 is located onshore UK within  the  proven  hydrocarbon  fairway  of  the 
South Humber Basin, on  trend  with  the  Saltfleetby  gasfield  and  Keddington 
oilfield which produces  oil  from  the  Upper  Carboniferous  Westphalian  aged 
reservoir sandstones. 
 
The Biscathorpe Prospect, a well defined four-way dip  closed  structure  mapped 
from reprocessed 3D seismic is contained within the licence area. 
 
The subsurface target location to evaluate  the  exploration  potential  of  the 
Biscathorpe Prospect has been defined and a surface  drilling location has  been 
identified from which a vertical  well  can  be  drilled  to  test  the  primary 
reservoir objective. 
 
Drilling operations are planned to commence  in late Q4 2013 or Q1 2014  subject 
to receipt of planning and other consents. 
 
The mean Prospective Resource  volume  for  the  main  reservoir  objective,  as 
calculated by Egdon, is estimated to be 17.81 million  barrels  of  oil. Further 
exploration upside is recognised  from  the  3D  seismic  and  well  data  which 
suggests the presence of a pinchout providing  a stratigraphic  component to the 
trap. 
 
The  Biscathorpe  structure  was  originally  drilled  by  BP  in  1987  by  the 
Biscathorpe-1 well which encountered a thin, oil-filled sandstone  in a  crestal 
position. Biscathorpe-2  will be  located  in a direction  towards thicker  sand 
development within structural closure of the trap. 
 
Under the terms of the agreement, Union Jack will pay 12% and 8% of the cost  of 
the  planned  Biscathorpe -2 well to  earn  a 6% and 4% interest from Egdon  and 
Montrose respectively. 
 
Following completion of  the  transaction  the  interested  parties  in  licence 
PEDL253 will be as follows; 
 
Egdon Resources U.K. Limited 54% (operator) 
 
Montrose Industries Limited 36% 
 
Union Jack Oil plc 10% 
 
Farm-In to PEDL241 
 
PEDL241 is located onshore UK within the  proven  hydrocarbon  fairway  of  the 
Humberside Platform. The nearby  Crosby  Warren  oilfield  and  the  Brigg  oil 
discovery are productive from Upper  Carboniferous  Namurian  aged  reservoirs. 
 
The North Kelsey Prospect, a well defined tilted fault  block  mapped  from  3D 
seismic, is contained within  the  licence  area. Based  on  offset well  data, 
potential  exists  for  four  separate  stacked  reservoir  sequences  to  be 
hydrocarbon bearing. 
 
The subsurface target location to evaluate the exploration of the  North Kelsey 
Prospect has been defined and a surface drilling location has  been  identified 
from which a vertical well can be drilled. 
 
Drilling operations are planned to commence in late Q4 2013 or Q1 2014  subject 
to receipt of planning and other consents. 
 
The  mean  combined  Prospective  Resource  volume  for  these  four  reservoir 
objectives, as calculated by Egdon, is estimated to  be 6.7 million  barrels of 
oil. 
 
Under the terms of the agreement Union Jack will  pay 20% of the  cost  of  the 
North Kelsey well to earn a 10% interest from Egdon. 
 
Following completion of  the transaction  the  interested  parties  in  licence 
PEDL241 will be as follows; 
 
Egdon Resources U.K. Limited 40% 
 
Celtique Energie Petroleum Limited 50% 
 
Union Jack Oil plc 10% 
 
Further to the PEDL241 agreements, Union Jack has  signed a  Letter  of  Intent 
with Egdon which gives the Company an option to enter  into a  second  Farm-In 
agreement for a further 5% Participating  Interest  in  PEDL241 under  the same 
terms as above. The Letter of Intent will terminate on 31 July 2013 should  the 
option not be exercised. 
 
North Somercotes/PEDL005R(part) Option 
 
Union Jack has signed a Letter of Intent with Egdon for an option to  acquire a 
10% Participating  Interest  in  PEDL005R,  limited  to  the  North  Somercotes 
Prospect. The Letter of Intent will terminate on 31 July 2013 should the option 
not be exercised. 
 
PEDL005R is located onshore UK within the proven  hydrocarbon  fairway  of  the 
South Humber Basin and contains the North Somercotes Prospect, a  tilted  fault 
block mapped from 3D seismic. 
 
Review of local offset well data suggests that the reservoir sands  are  likely 
to be thicker than the productive equivalent units in the hydrocarbon producing 
Keddington and Saltfleetby fields. 
 
The  subsurface  target  for  a  deviated  well  trajectory  to  evaluate  the 
exploration potential of the North Somercotes Prospect has been defined. 
 
A surface wellsite location has been identified and  drilling  operations  are 
planned to commence, subject to necessary consents, in 2014 or 2015. 
 
The mean Prospective Resource volume for  the  main  reservoir  objective,  as 
calculated by Egdon is  estimated  to  be 9 billion cubic feet of gas. Further 
exploration upside may exist in a closure  mapped in the  hanging wall  of the 
prospect. 
 
This  announcement  has  been  reviewed  and  approved  by  Martin  Durham,  a 
non-executive Director of the Company and a geologist with over  30  years  of 
experience. 
 
Martin is a fellow of the Geological Society and an  Honorary  Member  of  the 
Petroleum Exploration Society of Great Britain. 
 
The Directors of the Company accept responsibility for  the  contents  of this 
announcement. 
 
Contacts: 
 
Public Relations                                           +44 (0) 776 853 7739 
Yellow Jersey PR                                     dominic@yellowjerseypr.com 
Dominic Barretto 
 
Company                                                    www.unionjackoil.com 
Union Jack Oil plc                                          +44 (0) 77871 60682 
David Bramhill 
 
Broker                                                     +44 (0) 20 7796 8826 
Northland Capital Partners Limited 
Gavin Burnell 
 
Corporate Adviser                                          +44 (0) 20 7220 9796 
Peterhouse Corporate Finance Limited 
Guy Miller or Mark Anwyl 
 
Editors Note: 
 
Union Jack Oil plc is an oil and gas exploration company. 
 
The Company has  acquired  interests  in  several  UK  onshore  projects  where 
drilling is planned in the near term, offering substantial potential upside. 
 
The ongoing strategy is to acquire further licence interests with  an  emphasis 
on "drill ready" prospects. The Company sources such opportunities on a regular 
basis. 
 
 
 
END 
 

(END) Dow Jones Newswires

March 05, 2013 02:00 ET (07:00 GMT)