Union Jack Oil (UJO) has reported material landmark net revenues of US$7 million from the Wressle hydrocarbon development since the firm recommenced production in August 2021.
The Wressle hydrocarbon development, in which the UK focused onshore hydrocarbon production, development and exploration firm holds a 40% interest, is located in licences PEDL180 and PEDL182 in North Lincolnshire on the western margin of the Humber Basin.
Today, Union Jack Oil told investors that the well at the producing hydrocarbon development continues to produce under natural flow, with zero water cut while site upgrades are ongoing.
At 20 June 2022, cash balances and short term receivables stood at in-excess of £8.4m meaning that the company is debt free and covered for all operating and general admin costs and contracted or planned capital expenditure, including any budgeted drilling activities for at least the next 12 months.
As a result, Union Jack said it expects to report a maiden profit for the forthcoming unaudited half year results ending 30 June 2022 and to date, it remains cash flow positive.
Commenting on the performance this morning, Executive Chairman of Union Jack Oil, David Bramhill, said: "The ongoing excellent operational and financial performance at Wressle continues to bolster the Company's cash position, balance sheet and income statement.”
He also acknowledged that, in addition to $7m in revenues, Union Jack Oil has received further revenue contributions from the Keddington oilfield, the Fiskerton Airfield oilfield and North Sea Royalties. As a result, he expects to report a maiden profit in the first half of 2022.
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Over the last 18 months 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. As of today, cash balances and near-term receivables stand at in-excess of £8.4m - that’s up by around £0.85m as at 9 May 2022 when cash and near-term receivables stood at £7.545m.
Looking ahead into 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.
Notably, the Company is also now fully funded, including for any budgeted drilling activities, for at least the next 12 months. The stock’s value has increased by over 50% in the past three months, reaching highs of 31.4p.
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