Union Jack Oil reported today it had made about US$300,000 (£217,000) from test production at the Wressle well in North Lincolnshire.
The company, which has a 40% stake in the Wressle licence, did not state the precise duration of the test. But it said the operations took place over 22 days:
“Since the re-commencement of well testing at Wressle on 19 August 2021 to 9 September 2021, good quality oil has been produced and sold, netting Union Jack approximately US$300,000 of revenue during this short period.”
Based on a Brent crude oil price of about $70 a barrel, this suggests Wressle produced more than 4,200 barrels for Union Jack and more than 10,700 barrels in total.
Averaged over the test period, the rate would be more than 480 barrels per day. But Union Jack said production was “well in excess” of the projected 500 barrels of oil per day.
David Bramhill, Union Jack executive chairman said:
“If Wressle is only half as good as we anticipate, then we will be hearing much more about this development for many years to come.”
He added that the well had “not yet reached its peak potential” and was set to become the second-ranked UK onshore oil field, after Wytch Farm in Dorset.
In May 2021, the most recent official production figure available, Wytch Farm produced an average of 12,185 barrels of oil per day (bopd). The next biggest producing fields were Welton, Lincolnshire (430 bopd) and Singleton, West Sussex (427 bopd).
Union Jack shares closed the day at 27.5p, up 3.77%.
The Wressle production figures were published in interim accounts for the six months to June 2021.
The accounts reported a loss for the period of £833,446, slightly smaller than the same period in 2020. Revenue was up, but so were administrative expenses. Assets and liabilities both increased.
Union Jack said it planned to drill a side-track well at Biscathorpe in 2022. A decision on planning permission is still awaited.
The company also said it had acquired 2.5% of Claymore Piper Royalty Complex in the North Sea. Negotiations were underway for a further 25% interest, it said.
Revenue: £241,467 (six months to June 2020: £62,993)
Total admin expenses: £828,813 (six months to June 2020: £761,297)
Loss for the period: £833,446 (six months to June 2020: £885,300)
Cash balance: £4,672,508 (six months to June 2020: £4,621,774)
Total assets: £20,681,475 (six months to June 2020: £13,574,506)
Total liabilities: £3,309,306 (six months to June 2020: £1,004,780)
Union Jack onshore holdings
55% Keddington, Lincolnshire (PEDL005R)
50% North Kelsey, Lincolnshire (PEDL241)
45% of Biscathorpe, Lincolnshire (PEDL253)
40% Wressle, North Lincolnshire (PEDL180/182)
16.665% West Newton, East Yorkshire (PEDL183)