TIDMUJO
RNS Number : 4526F
Union Jack Oil PLC
15 July 2019
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement
15 July 2019
Union Jack Oil plc
("Union Jack" or the "Company")
Biscathorpe-2 Well Update
Union Jack Oil plc (AIM: UJO), a UK focused on-shore hydrocarbon
production, development and exploration company notes the positive
announcement made today by Egdon Resources plc ("Egdon"), in
respect of the Biscathorpe-2 exploration well. Union Jack holds a
22% interest in PEDL253 containing the Biscathorpe Prospect. Egdon
included the following statements:
Egdon Resources plc (AIM:EDR) is pleased to provide a positive
update in respect of the Biscathorpe-2 exploration well drilled in
Petroleum Exploration and Development Licence PEDL253, located in
Lincolnshire, where Egdon holds a 35.8% interest.
The Biscathorpe-2 well is located within the proven hydrocarbon
fairway of the Humber Basin, on trend with the Saltfleetby gasfield
and the Keddington oilfield which produces oil from a Carboniferous
Westphalian aged sandstone reservoir ("Westphalian") and which was
the principal target in the Biscathorpe-2 well. The initial well
results were reported on 20 February 2019. During drilling elevated
gas readings were recorded from the Westphalian and below this over
the total 157 metre Dinantian Limestone interval ("Dinantian")
along with the presence of oil shows (pale white blue cut
fluorescence) in both Westphalian and Dinantian cuttings samples.
The Biscathorpe-2 well was suspended to allow the option for a
future side-track to be made following the re-processing and
re-mapping of up to 85 square kilometres of existing 3D seismic
data.
Since reporting the initial well results, further detailed
technical analyses of the data from the Biscathorpe-2 well have
been undertaken, including an updated petrophysical evaluation by
both Egdon and Union Jack's petrophysical consultants which
focussed specifically on the Dinantian. These petrophysical
analyses indicated hydrocarbon saturations of greater than 50%
within the upper parts of the Dinantian.
Union Jack, Montrose Industries Limited, and Egdon Resources
plc, also appointed independent geotechnical consultants, Applied
Petroleum Technology (UK) Limited ("APT"), to perform a detailed
geochemical analysis of drill cutting samples taken from 20
intervals in the Biscathorpe-2 well, comprising five from the
Westphalian and 15 from the Dinantian. The objective of the APT
analysis was to provide geochemical evidence for the presence of
live hydrocarbons together with an estimate of the likely oil
quality (the "APT Report").
The APT Report has confirmed the occurrence of hydrocarbons in
the Westphalian and Dinantian cutting samples analysed from the
Biscathorpe-2 well. The APT Report also confirmed that the data
supports the existence of a significant column of good quality oil
(high API gravity), within the Dinantian, validated by the presence
of a full suite of gases ranging from methane to pentane (C1 to C5
and nC5) recorded during drilling, all indicative of a working
petroleum system in close proximity to the Biscathorpe-2 well.
A sample of oil from the nearby producing Keddington oilfield to
the east of PEDL253, was analysed as a benchmark for comparison
with the hydrocarbons extracted by APT from the Biscathorpe-2
cutting samples.
The key results contained in the APT Report are summarised
below:
-- Good quality hydrocarbon extracts were obtained from the
Westphalian and Dinantian cuttings samples
-- All hydrocarbons extracted appear to be non-biodegraded
-- The hydrocarbons extracted are comparable to those extracted
from a known oil-bearing Westphalian interval (Keddington
oilfield)
-- APT confirmed the likely presence of a live oil column in the
top of the Dinantian interval from approximately 1,980 metres to
2,015 metres (35 metres), with likely residual oil below
-- Data evaluated at the base of the analysed section, and
wellsite gas readings, are also suggestive of possible additional
hydrocarbon pay below 2,133 metres
-- API gravity results in the Biscathorpe-2 well intervals were as follows:
Westphalian interval 35 API
Dinantian interval 33-34 API
----------
The results of the APT Report together with re-processed 3D
seismic data will be integrated to inform the direction of any
potential future side-track of the Biscathorpe-2 well that would
target the Westphalian and Dinantian.
Commenting on these positive results Mark Abbott, Managing
Director of Egdon, said:
"The results of the revised petrophysical analysis and the APT
Report have upgraded the Biscathorpe-2 well result, confirming the
likely presence of a 35 metre column, of good quality oil, within
the Dinantian interval. This along with the elevated gas readings
and oil shows over an extended interval in the well are indicative
of proximity to an effective petroleum system and validate the
potential that exists within the PEDL253 licence area.
The primary target reservoir at Biscathorpe, the Basal
Westphalian sandstone, was likely absent at the Biscathorpe-2
location and remains untested by the well. Further technical work
is planned, including the reprocessing of the existing 3D seismic
data, prior to deciding the next steps for the project which could
include a side track of the suspended Biscathorpe-2 well.
"We look forward to updating shareholders further once the
results of the 3D reprocessing are finalised."
Further commenting on these positive results, David Bramhill,
Executive Chairman of Union Jack, said:
"The APT Report confirms the likely presence of hydrocarbons in
the Westphalian and Dinantian, interpreted to be oil, over a
potentially large interval, and highlights the potential upside we
see within the PEDL253 licence area. Biscathorpe, in the opinion of
Union Jack's management, remains one of the UK's largest onshore
un-appraised conventional hydrocarbon prospects.
"The confirmation within the APT Report of the likely presence
of good quality API gravity hydrocarbons within the Westphalian and
Dinantian, has significantly upgraded the Biscathorpe-2 well result
and enables Union Jack to view the prospectivity of the area around
Biscathorpe-2, and the overall potential of PEDL253, much more
favourably.
"In our opinion, the Basal Westphalian sandstone that was the
primary target of the Biscathorpe-2 well, remains untested, as do
the hydrocarbons unexpectedly encountered within the Dinantian.
"Union Jack and its joint venture partners will now undertake
further technical work before being able to confirm next steps in
relation to a possible future side track of the Biscathorpe-2
well.
"We look forward to reporting on events in respect of
Biscathorpe during 2019 and as they unfold thereafter."
Competent Person's Statement
In accordance with the "AIM Rules - Note for Mining and Oil and
Gas Companies", the information contained within this announcement
has been reviewed and signed off by Graham Bull, Non-Executive
Director, who has over 46 years of international oil and gas
industry experience.
For further information, please contact:
Union Jack Oil plc +44 (0)7787 160 682
David Bramhill
SP Angel Corporate Finance LLP +44 (0)20 3470 0470
Nominated Adviser and broker
Lindsay Mair
Richard Hail
Cassiopeia Services Ltd +44 (0)7949 690 338
Public Relations
Stefania Barbaglio
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END
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