Union Jack Oil (UJO) confirmed to investors this morning that the North Sea Transition Authority ("NSTA") has approved the company’s Wressle Field Development Plan ("FDP").
The NSTA, formerly the Oil and Gas Authority, has also approved the licences entering their production phase, which will continue through to 2039, the UK-focused onshore hydrocarbon production, development and exploration company informed its shareholders this morning.
UJO holds a 40% interest in the Wressle hydrocarbon development located within licences PEDL180 and PEDL182 in North Lincolnshire on the western margin of the Humber Basin.
Executive Chairman, David Bramhill has described the approval of the FDP by the NSTA as another “significant and important milestone” in the history of the Wressle development
He explained that the Wressle-1 well is currently amongst the most productive wells in the United Kingdom, and that to date, it has produced over 170,000 barrels of high-quality oil.
Following the approval, UJO will now install the few remaining permanent production facilities and progress the planning, permitting and implementation of the firm’s gas monetisation plan.
UJO price chart
Just last week, Union Jack reported material landmark net revenues of US$6 million from the Wressle hydrocarbon development since the firm recommenced production in August 2021.
It said at the time that the well at the producing hydrocarbon development was continuing to produce under natural flow with zero water cut while site upgrades also remained ongoing.
As at 23 May 2022, cash balances and near-term receivables stood at in-excess of £7.7m meaning that the company is covered for all G&A, OPEX and contracted or planned CAPEX costs, including any budgeted drilling activities for at least the next 12 months and debt free.
Bramhill, who hailed the achievement as another period of “stellar performance”, said the firm is now on a material growth trajectory which augurs well for its future and its shareholders.
In the year to 31 December 2021 and to date, UJO says it has transformed financially with substantial revenues and positive indications. In particular, revenues received from Wressle have transformed its financial well-being and ‘significantly strengthened’ its balance sheet.
Looking ahead in 2022 and beyond, Union Jack anticipates that hydrocarbons will continue to play an important part in ensuring the energy security of the United Kingdom, particularly as the global demand for energy increases post COVID-19 and the global economy recovers.
UJO’s progress, along with a robust oil price and strong Wressle oil production, has generated solid revenues and underpins the Board’s expectation of ongoing future material cash flows.
As a result, the Board recently initiated plans for a Capital Reduction to allow for the payment of a dividend or to implement a share-buy-back programme to reward the firm’s shareholders.
Notably, the Company is also now fully funded for all G&A, OPEX, and contracted or planned CAPEX costs, including any budgeted drilling activities, for at least the next 12 months. The stock’s value has increased by over 110% since the start of the year, reaching highs of 31.4p.
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Union Jack Oil gets Wressle field plan approved – Vox Markets
