Union Jack Oil, the majority investor in the Wressle onshore site in North Lincolnshire, has announced its first move into the US.

In a statement today, the company said it had bought three mineral royalty packages in Texas.

They are all in the Permian basin, which produces about 6% of the world’s daily oil requirements.

The packages cost £677,235, Union Jack said. They will be owned in perpetuity and estimated to have an economic life of more than 26 years, the company said.

It added that the sites would provide a monthly income but would have no development or operating costs.

Union Jack said it was also poised to seal a deal on exploration, drilling and potential production projects in Oklahoma.

David Bramhill, Union Jack’s chairman, said the company’s onshore UK sites would remain the “core focus for the foreseeable future”.

Union Jack has a 40% stake at Wressle, where there are plans to drill another two production wells.

It also holds 16.665% of the West Newton licence in East Yorkshire. Here, there is a commitment to drill a new horizontal well and sidetrack or recomplete three other wells by June 2024. The site operator, Rathlin Energy, has estimated its cost of the work at West Newton to be about £9m.

Mr Bramhill said:

“”The investment climate for international investment outside of the UK, especially within the United States, has improved significantly, driven primarily by streamlined asset ownership and the evolution of enabling technologies.”

The royalties provided immediate cash flow, he said, without exposure to capital expenditure. It had the scope to grow “exponentially”, as new wells were drilled and completed, he said.

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