Union Jack Oil (UJO ) has released positive update in regard to its extended well test operations at the Wressle Oilfield development on the Western margin of the Humber Basin. 

The Wressle oilfield development, located in North Lincolnshire, is covered by the PEDL180 and PEDL182 licences. Union Jack holds a 40% economic interest in this development.  

In July, the firm told investors that the proppant squeeze operation on the Ashover Grit reservoir interval in the Wressle-1 well has now been completed “safely and successfully.”  

The UK-focused onshore hydrocarbon exploration group previously informed investors back in June 2021 that there had been a delay affecting the progression of the proppant squeeze operation as a result of the contractor's equipment being held on a job that had overrun.   

Today, UJO said the coiled tubing operation has now been completed safely and successfully and that the Ashover Grit reservoir has been returned to flow under well test conditions. 

To date, initial well test measured flow rates, under a restricted choke, have exceeded 500 barrels of oil per day which was the forecast rate following the proppant squeeze operation. 

The Company explained that the Wressle-1 well is ‘continuing to clean up’ but highlighted to investors that the well has not yet reached its optimum potential. Union Jack said a further update will be provided once a stabilised oil flow rate is established in the coming weeks. 

Executive Chairman of Union Jack, David Bramhill commented: "At a full production rate of 500 barrels of oil per day, Wressle, at current oil prices, would transform the economics of the Company with a materially positive impact on our revenues and operating cash flow.” 

Speaking further on Wressle he said: "UJO Management are of the opinion that Wressle is still at a very early stage in its development and that considerable upside potential remains given the higher Wingfield Flags and Penistone Flags reservoirs, that are not part of this test programme, have both already demonstrated their ability to flow oil to surface during testing of the original discovery well, as well as other opportunities within the licence areas.” 

View from Vox 

Wressle is believed to be economically robust with an estimated project break-even price oil price of $17.62 per barrel and expected to result in an initial constrained production rate of 500 barrels of oil per day gross, or 200 barrels of oil per day net to Union Jack. Positive news on production at Wressle is positive for UJO as a 40% shareholder in the project.   

UJO is an onshore oil and gas exploration firm with a focus on drilling, development and investment opportunities in the UK hydrocarbon sector, and currently holds interests in 13 licences in areas including, inter alia, the East Midlands, Humber Basin and East Yorkshire.   

West Newton 

The UK focused onshore hydrocarbon explorer holds a 16.665% interest in PEDL183, containing the conventional West Newton A-1 discovery well and WNA-2 appraisal well.    

West Newton is located at the heart of the Zero Carbon Humber project area, which aims to promote decarbonising technologies across industrial activities in the wider Humber region.   

In October 2020, it reported that the onshore West Newton B-1 ("WNB-1") well - the next well following the successful West Newton A-2 ("WNA-2") appraisal well - had been spud.    

Results from the drilling of WNB-1 are expected to inform a subsequent programme of testing to establish the well's productive capability as well as future drill operations.   

North Kelsey

In recent months, UJO also increased its stake in the North Kelsey project by acquiring an additional 30% from Egdon Resources, taking its stake in the exploration project up to 50%.     

Further financial obligations will be equal between Union Jack and Egdon Resources, in line with both parties’ 50% stake in the North Kelsey Prospect which is located in Lincolnshire.    

The North Kelsey Prospect is a conventional oil prospect along trend from and analogous to the Wressle oil development, which lies around 15 kilometres to the northwest.    

The UK- focused group said the prospect has been mapped from 3-D seismic data and has the potential for oil in up to four stacked conventional Carboniferous reservoir targets.     

David Bramhill, Executive Chairman of UJO, described North Kelsey as “a low cost, drill-ready onshore acquisition for Union Jack in our focus area, consistent with our strategy.”    

He said a further stake in the project increases the group’s exposure to a “potentially value adding project” as well as expanding UJO’s balanced drilling and development portfolio.    

Subject to a successful farm-out, North Kelsey-1 is expected to be drilled during 2021.    

Wressle

In recent months, Operator, Egdon Resources U.K. Limited, commenced operations to re-complete and reperforate the well located at the Wressle hydrocarbon development site.   

The Ashover Grit reservoir is expected to produce 500 barrels of oil per day at a constrained rate, increasing UJO’s net production by an additional 200 bopd when fully on stream.   

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