Union Jack Oil acquires further 35% interest in Keddington oil field
Following its completion, Union Jack will hold a 55% economic interest in Keddington, with the operator, Egdon Resources, holding the remaining 45%.
Currently, the producing Keddington oil field yields around 28 barrels of oil per day.
Egdon Resources is finalising the assessment of a potential in-fill drilling programme to increase production volumes ‘multi-fold’ via a relatively inexpensive side-track well.
The acquisition will boost Union Jack’s share of the project’s contingent resources to 311,000 barrels and prospective resources to 349,250 barrels.
Shares in Union Jack Oil were trading -11.54% lower at 0.115p during Monday trading.
The company is paying £200,000 consideration to acquire the extra stake in the field, funded from existing cash resources.
“This Acquisition is an inexpensive transaction and provides an immediate uplift in oil production,” said David Bramhill, Executive Chairman of Union Jack.
“It will have a beneficial effect,” he said, “when consolidated into the production revenues generated from Fiskerton Airfield and the expected "first oil" from the Wressle development later in the year.”
As part of the acquisition, Union Jack will also acquire a 15% interest in PEDL339 which hosts the Louth prospect and is estimated to hold around 600,000 barrels of oil alongside further prospective resource potential.
The Keddington site lease has been extended until 2029, whilst current consent expires in 2058, with approval in place for the drilling of a further two wells, the statement added.
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