TIDMUJO
RNS Number : 1658Z
Union Jack Oil PLC
13 September 2022
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with
the Company's obligations under Article 17 of MAR.
13 September 2022
Union Jack Oil plc
("Union Jack" or the "Company")
Gaffney Cline Report
Reserves and Contingent Resources of the Wressle Oilfield
PEDL180 and PEDL182
Illustrative Production Scenario
Upside Potential
Union Jack Oil plc (AIM: UJO), the UK focused onshore
hydrocarbon production, development and exploration company, is
pleased to announce that Gaffney, Cline & Associates Limited
("GaffneyCline") has prepared an independent Reserves and
Contingent Resources report with an Effective Date of 30 June 2022,
on the Wressle Oilfield, PEDL180 and PEDL182, onshore United
Kingdom. Included in this work was the development of an
Illustrative Production Scenario for the potential future
development of the field that includes the Contingent Resources. In
addition, an independent assessment of the upside potential of the
producing Ashover Grit and the Santon Sands horizons was
undertaken.
HIGHLIGHTS
-- Ashover Grit Speculative Deeper Oil-Water Contact assessment
indicates a potentially significant increased estimate of STOIIP
("Stock Tank Oil Initially in Place") of 10.12 million barrels of
oil ("MMBbl") and a recoverable resource of 2.43 MMBbl
-- The Wressle-1 well also indicated the hydrocarbon potential
of the Santon Sandstone where GaffneyCline has estimated a
Contingent Resource
-- Illustrative Production Scenario shows a constrained plateau
production rate of 800 barrels of oil per day for approximately
five years
-- Ashover Grit and Wingfield Flags oil reserves at the
Effective Date of 30 June 2022 stood at 1P 320,000, 2P 670,000 and
3P 1,030,000 barrels of oil following past production of 203,000
barrels of high-quality oil with zero water cut
An abridged version of the Report is presented and the full
Report can be viewed on the Company's website
www.unionjackoil.com
In addition, an animated PowerPoint highlighting the key points
of the Report can also be viewed on the Company's website.
The Report has been prepared exclusively for Union Jack and its
content does not necessarily reflect the Operators or other Partner
views.
In the preparation of the Report, GaffneyCline has adopted the
Petroleum Resources Management System ("PRMS") standard and used
definitions contained therein.
GaffneyCline has approved this RNS and PowerPoint
presentation.
RESERVES AND CONTINGENT RESOURCES OF THE WRESSLE OILFIELD
Licence Summary and Ownership Details
The Wressle oilfield is located within licences PEDL180 and
PEDL182 in Lincolnshire on the Western Margin of the Humber
Basin.
Union Jack holds a 40% economic interest in these licences.
Licence Ownership Details
Licence Holders (WI) Operator Area (km(2) Award Expiry
) Date Date
PEDL180 Union Jack Oil plc (40%) Egdon 40 1 July 1 July
Egdon Resources U.K. Limited 2008 2039
(30%)
Europa Oil and Gas Limited
(30%)
------------------------------ --------- ------------ ------- -------
PEDL182 Union Jack Oil plc (40%) Egdon 19 1 July 1 July
Egdon Resources U.K. Limited 2008 2039
(30%)
Europa Oil and Gas Limited
(30%)
------------------------------ --------- ------------ ------- -------
Wressle Oilfield Oil Reserves as at 30 June 2022
Reservoir Gross (MMBbl) Net to Union Jack (MMBbl)
1P 2P 3P 1P 2P 3P
----- ----- ----- --------- --------- --------
Ashover / Wingfield 0.32 0.67 1.03 0.17 0.27 0.41
----- ----- ----- --------- --------- --------
The remaining 2P reserves of 0.67 MMBbl compares to initial
gross 2P reserves of 0.62 MMBbl as originally reported in the
Company's announcement of 26 September 2016. This figure is post
past production of 203,000 barrels of oil.
Wressle Oilfield Contingent Resources as at 30 June 2022
Reservoir Gross (MMBbl) Net to Union Jack (MMBbl)
1C 2C 3C 1C 2C 3C
----- ----- ----- --------- --------- --------
Penistone Flags 0.85 1.56 2.74 0.34 0.62 1.10
----- ----- ----- --------- --------- --------
Santon Sandstone 0.03 0.06 0.11 0.01 0.02 0.04
----- ----- ----- --------- --------- --------
Gross Contingent Resources are 100% of the volumes estimated to
be recoverable from the discovery if it is developed.
The volumes reported here are "unrisked" in the sense that no
adjustment has been made for the risk that the discovery would not
be developed in the form envisaged or not at all (i.e. no "Chance
of Development" factor has been applied).
Wressle Oilfield Gas Contingent Resources as at 30 June 2022
Reservoir Gross (Bscf) Net to Union Jack (Bscf)
1C 2C 3C 1C 2C 3C
----- ----- ----- --------- -------- --------
Ashover Grit 0.21 0.44 0.67 0.08 0.18 0.27
----- ----- ----- --------- -------- --------
Penistone Flags 0.95 1.98 2.52 0.38 0.79 1.01
----- ----- ----- --------- -------- --------
Wingfield Flags 0.03 0.05 0.11 0.01 0.02 0.04
----- ----- ----- --------- -------- --------
Santon Sandstone 0.06 0.11 0.20 0.02 0.04 0.08
----- ----- ----- --------- -------- --------
The associated gas from the Ashover Grit and Wingfield Flags
production is classified as Contingent Resources as no method to
monetise these resources is currently in place. Contingent Resource
estimates take into account gas production to effective date.
The volumes reported here are "unrisked" in the sense that no
adjustment has been made for the risk that the discovery would not
be developed in the form envisaged or not at all (i.e. no "Chance
of Development" factor has been applied).
Wressle Oilfield: Estimates of Gross Technically Recoverable
Resources ("TRR")
Reservoir Oil TRR (MMBbl) Gas TRR (Bscf)
Low Best High Low Best High
------ ----- ----- ----- ----- -----
Ashover Grit 0.39 0.77 1.58 0.22 0.43 0.87
------ ----- ----- ----- ----- -----
Wingfield Flags 0.04 0.08 0.16 0.05 0.08 0.15
------ ----- ----- ----- ----- -----
Penistone Flags 0.85 1.56 2.74 0.95 1.98 3.52
------ ----- ----- ----- ----- -----
Santon Sandstone 0.03 0.06 0.11 0.01 0.02 0.04
------ ----- ----- ----- ----- -----
Cumulative production to 30 June 2022 is 203 MBbl of oil and 116
MMscf of gas.
ASHOVER GRIT AND SANTON SANDS UPSIDE POTENTIAL
Ashover Grit Deeper Oil-Water Contact
There remains uncertainty about the extent and size of the
Ashover Grit trap. Mapping of the Ashover Grit at the Wressle
oilfiled by GaffneyCline using the 3D seismic data indicates that
the spill-point of the trap could be deeper than the oil-down-to
("ODT") derived from log data used in the estimation of Reserves.
However, a water-up-to ("WUT") in the deeper part of the Ashover
Grit in the Wressle-1 well at 1,622m TVDss is deeper than the
closure. Therefore, the trapping mechanism and spill-point are
uncertain and may be deeper than the values used in the Reserves
estimation. These results provide a potentially significant
increased STOOIP estimate and potentially recoverable volumes. Not
all of the volumes may be recoverable from the Wressle-1
location.
Single Deterministic Estimate for Deeper Oil-Water Contact
Scenario
Reservoir STOIIP Recoverable
(MMBbl) (MMBbl)
-------- ------------
Ashover Grit (Deeper
Oil-Water Contact) 10.12 2.43
-------- ------------
The volumes estimated use the same reservoir parameters as the
Reserves estimates for the Ashover Grit with the exception of the
Gross Rock Volume estimate
A recovery factor of 24% is assumed.
Santon Sandstone Upside Potential
The Wressle-1 well also indicated the hydrocarbon potential of
the Santon Sandstone. This reservoir requires further data to be
obtained during future drilling in the field before any development
can be planned, however this provided additional future potential.
This formation was not tested in the Wressle-1 well.
Santon Sandstone Contingent Oil Resources
Reservoir Gross (MMBbl) Net to Union Jack (MMBbl)
1C 2C 3C 1C 2C 3C
----- ----- ----- --------- --------- --------
Santon Sandstone 0.03 0.06 0.11 0.01 0.02 0.04
----- ----- ----- --------- --------- --------
Santon Sandstone Contingent Gas Resources
Reservoir Gross (Bscf) Net to Union Jack (Bscf)
1C 2C 3C 1C 2C 3C
----- ----- ----- --------- -------- --------
Santon Sandstone 0.06 0.11 0.20 0.02 0.04 0.08
----- ----- ----- --------- -------- --------
Future Development of the Wressle Oilfield and Illustrative Oil
Production Profile
The Wressle-1 well is currently producing oil and gas from the
Ashover Grit reservoir.
The current field development Plan ("FDP") envisages that along
with continued production from the Ashover Grit and Wingfield
Flags, the Penistone Flags reservoir is developed with two or three
additional wells.
Based on the reserves and contingent resources identified in the
Report, an Illustrative Production Scenario shows that a
constrained plateau production rate of 800 barrels of oil per day
may be possible for approximately five years.
There is significant uncertainty on the initial flowrate that
will be obtained from the Penistone Flags reservoir and that,
whilst the observation that 800 barrels of oil per day may be
possible for approximately five years and is based in part on the
recent FDP, this Illustrative Production Scenario does not
necessarily reflect the Operator's or the other Partner's
views.
Executive Chairman of Union Jack David Bramhill, commented: "The
GaffneyCline Report reflects a serious technical effort over a
prolonged period and its content is highly encouraging for the
future of the Wressle development.
"GaffneyCline's findings, observations and technical work in
respect of the potential upside in respect of the Ashover Grit
reservoir have gone a long way in answering our questions regarding
future potential upside and prolonged productivity.
"The Illustrative Production Profile indicates robust and
material productivity for at least five years and beyond. Should
the Deeper Oil-Water Contact potential of the Ashover Grit
reservoir become proven, the incremental value of Wressle as a
development would be transformational for the Wressle partners.
"The current Reserves at the Ashover Grit and Wingfield Flags in
respect of 2P figures according to GaffneyCline stands at 670,000
bbls of oil as at 30 June 2022. This figure is post past production
figures of 203,000 bbls of oil, a substantial upgrade to the
originally reported recoverable Reserve.
"Union Jack thanks GaffneyCline for their diligence in compiling
this excellent, informative, and value adding report."
About GaffneyCline
GaffneyCline is an international energy consultancy, which has
been operating worldwide since 1962. GaffneyCline focuses solely on
the petroleum and energy industry and specialises in the provision
of policy, strategy, technical and commercial assistance to
governments, financial institutions, and international oil, gas and
energy companies worldwide.
The provision of Energy Transition and Carbon Intensity
Assessment have recently been added as a core component of
GaffnyCline's international business.
(www.gaffneycline.com)
Glossary
Standard Oil Industry Terms and Abbreviations
Bbl Barrels
Bopd Barrels oil per day
-----------------------------------------------
Bscf or Bcf Billion standard cubic feet
-----------------------------------------------
degC Degrees Celsius
-----------------------------------------------
E&P Exploration and production
-----------------------------------------------
km Kilometres
-----------------------------------------------
km2 Square kilometres
-----------------------------------------------
m Metres
-----------------------------------------------
M Thousand
-----------------------------------------------
m3d Cubic metres per day
-----------------------------------------------
MD Measured depth
-----------------------------------------------
MM Million
-----------------------------------------------
MMBbl Millions of barrels
-----------------------------------------------
MMcf or MMscf Million standard cubic feet
-----------------------------------------------
p.a. Per annum
-----------------------------------------------
PRMS Petroleum Resources Management System
-----------------------------------------------
P10 Value with a 10% probability of being exceeded
-----------------------------------------------
P50 Value with a 50% probability of being exceeded
-----------------------------------------------
P90 Value with a 90% probability of being exceeded
-----------------------------------------------
RF Recovery factor
-----------------------------------------------
scf Standard cubic feet
-----------------------------------------------
scfd Standard cubic feet per day
-----------------------------------------------
So Oil saturation
-----------------------------------------------
stb Stock tank barrel
-----------------------------------------------
STOIIP Stock tank oil initially in place
-----------------------------------------------
Sw Water saturation
-----------------------------------------------
TD Total depth
-----------------------------------------------
TRR Technically Recoverable Resources
-----------------------------------------------
TVDss True vertical depth subsea
-----------------------------------------------
1C Low estimate of Contingent Resources
-----------------------------------------------
2C Best estimate of Contingent Resource
-----------------------------------------------
3C High estimate of Contingent Resources
-----------------------------------------------
2D Two dimensional
-----------------------------------------------
3D Three dimensional
-----------------------------------------------
1P Proved Reserves
-----------------------------------------------
2P Proved plus Probable Reserves
-----------------------------------------------
3P Proved plus Probable plus Possible Reserves
-----------------------------------------------
For further information, please contact
Union Jack Oil plc info@unionjackoil.com
David Bramhill
SP Angel Corporate Finance LLP +44 (0)20 3470 0470
Nominated Adviser and Joint Broker
Matthew Johnson
Richard Hail
Caroline Rowe
Shore Capital +44 (0)20 7408 4090
Joint Broker
Toby Gibbs
Iain Sexton
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