Jersey Oil and Gas PLC Option Agreement with Equinor UK Limited (0587P)
October 08 2019 - 2:00AM
UK Regulatory
TIDMJOG
RNS Number : 0587P
Jersey Oil and Gas PLC
08 October 2019
8 October 2019
Jersey Oil and Gas plc
("Jersey Oil & Gas", "JOG" or the "Company")
Option Agreement with Equinor UK Limited ("Equinor")
Jersey Oil & Gas (AIM: JOG), an independent upstream oil and
gas company focused on the UK Continental Shelf ("UKCS") region of
the North Sea, announces that Equinor has elected not to exercise
the three month option which was granted by the Company over a 50%
equity interest in respect of Blocks 20/5a and 21/1a (the "Buchan
Blocks"), which contain the Buchan oil field and the J2 oil
discovery.
The Buchan oil field is a significant redevelopment opportunity,
having ceased production prematurely due to safety concerns with
its aging production facilities which were removed by the previous
operator. A wealth of subsurface data exists on the field, with two
major independent studies concluding that the field has remaining
mean case recoverable volumes of approximately 80 million barrels
of oil equivalent ("mmboe"). Buchan has historically produced
almost entirely through only natural depletion and the deployment
of modern technologies and practices are expected by JOG's
management to enable the field to produce for potentially in excess
of a further twenty years.
Buchan will form the hub for JOG's Greater Buchan Area ("GBA")
development plans. In close proximity are the JOG owned J2 and
Glenn oil discoveries and the Equinor operated Verbier oil
discovery, which represent attractive potential tie-back
opportunities to the Buchan hub. In aggregate, JOG internal
estimates indicate that some 144 mmboe of gross recoverable
resources can be commercially produced through the Buchan hub,
which would make it the largest new area hub in the UK Central
North Sea since Golden Eagle. Additionally, within the catchment
area of the GBA, there is significant upside potential to tie in
additional third party discovered resources and any further GBA
exploration upside.
Equinor will continue its efforts to mature and assess the
opportunities in the adjacent Equinor operated P.2170 (Verbier)
licence, working closely with JOG as part of the overall Greater
Buchan Area Plan to maximise economic recovery in the area.
JOG will remain as 100% licence holder and operator of blocks
20/5a and 21/1a and has now commenced the concept appraisal and
selection phase activities of the GBA development.
Andrew Benitz, CEO of Jersey Oil & Gas, commented:
"Jersey Oil and Gas continues to enjoy a strong collaborative
working relationship with Equinor that began by bringing them into
P2170 as a farm-in partner in 2016. It was as a result of this
collaboration that we offered them, at this early stage of the
project, a 90 day opportunity to participate in our Greater Buchan
Area plans. Their decision not to exercise the option provides JOG
with greater flexibility, control and the full value potential of
this very exciting new area development project, which based on our
estimates of discovered oil volumes has the potential to be the
largest new area hub in the UK Central North Sea since Golden
Eagle.
"We have initiated the Appraise and Select phases of our Field
Development Plan. As we progress to define and select the best
development concept, we will consider farm-outs for value to
industry partners prior to submitting FDP in 2022."
Enquiries:
Jersey Oil and Gas plc Andrew Benitz, CEO C/o Camarco:
Tel: 020 3757 4983
Strand Hanson Limited James Harris Tel: 020 7409 3494
Matthew Chandler
James Bellman
Arden Partners plc Paul Shackleton Tel: 020 7614 5900
Benjamin Cryer
BMO Capital Markets Limited Jeremy Low Tel: 020 7236 1010
Tom Rider
Camarco Billy Clegg Tel: 020 3757 4983
James Crothers
Notes to Editors:
Jersey Oil & Gas is a UK E&P company focused on building
an upstream oil and gas business in the North Sea. The Company
holds a significant acreage position within the Central North Sea
referred to as the Greater Buchan Area, which includes Operatorship
and 100% working interests in blocks that contain the Buchan oil
field and J2 and Glenn oil discoveries, as well as an 18% working
interest in the P2170 licence, Blocks 20/5b & 21/1d, operated
by Equinor UK Limited ("Equinor") that contains the Verbier oil
discovery.
JOG's acreage is estimated to contain more than 120 million
barrels of oil equivalent ("mmboe") of discovered mean recoverable
resources net to JOG, in addition to significant exploration upside
potential. JOG is currently progressing the appraise and select
phases of a Field Development Plan ("FDP") for the Greater Buchan
Area, with first oil, subject to funding, targeted for 2024.
JOG is focused on delivering shareholder value and growth
through creative deal-making, operational success and licensing
rounds. Its management is convinced that opportunity exists within
the UK North Sea to deliver on this strategy and the Company has a
solid track-record of tangible success.
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation (EU) No. 596/2014.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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