Union Jack announced this morning it was buying a 3% stake in Beacon Energy plc, an onshore oil and gas company with assets in Germany.

In a statement to investors, Union Jack said it was investing in Beacon’s subsidiary, Rhein Petroleum GmbH.

Union Jack said it would hold 430 million shares, representing 3.22% of Beacon’s share capital.

Beacon has reported interests in appraisal, development and production in Germany.

Last week, it raised £4.3m in a share placing to provide working capital for a well at Schwarzbach in the Erfelden field in Upper Rhine Graben.

Union Jack’s announcement comes a week after company executive chairman, David Bramhill, criticised the “painfully slow” rate of progress of onshore oil and gas in the UK, which he blamed on the regulatory process.

He said Union Jack would be “compelled strategically to seek growth opportunities further afield in politically safe regimes and with sympathetic views towards the oil industry”.

Before today’s announcement, Union Jack’s interests were all onshore in the UK.

The company has a 40% stake at Wressle, in North Lincolnshire, the country’s newest onshore oil production field. It also has interests in the West Newton field in East Yorkshire (16.665%), and Biscathorpe (45%), Keddington (55%) and North Kelsey (50%), all in Lincolnshire.

Today, Mr Bramhill said:

“In line with our stated strategy to seek growth opportunities in foreign jurisdictions with politically safe regimes, we are very pleased to declare our initial investment in Beacon. We consider the investment to be a good use of capital generated from consistent cash flows principally from our flagship asset at Wressle.

“We have met with the management of Beacon and are familiar with their onshore assets in Germany, which we consider hold impressive scope and upside potential for both the near and mid-term.

“Without doubt we see a synergy between Beacon’s and Union Jack’s modus operandi and we look forward to the results of what appears to be a very encouraging and value accretive work programme going forward, including the testing of the Schwarzbach-2(2.) well.”