TIDMJOG
RNS Number : 2406G
Jersey Oil and Gas PLC
22 July 2019
22 July 2019
Jersey Oil and Gas plc
("Jersey Oil & Gas", "JOG" or the "Company")
31st Supplementary Offshore (Buchan Area) Licensing Round
Awards
Jersey Oil & Gas awarded significant acreage containing
over
100 million barrels of discovered oil, including the Buchan oil
field
Option Agreement with Equinor UK Limited ("Equinor")
Highlights:
-- JOG awarded, subject to documentation, 100% working interests
and operatorship of three blocks in the Oil & Gas Authority's
("OGA") 31(st) Supplementary Offshore Licensing Round
-- Acreage awarded includes the Buchan oil field and the J2 oil discovery
-- Acreage is contiguous with JOG's existing interest in Licence
P2170 (Blocks 20/5b and 21/1d) that contains the Verbier
discovery
-- JOG's acreage interest in the Greater Buchan Area ("GBA"),
including P2170, is estimated to contain more than 100 million
barrels of oil equivalent ("mmboe") discovered mean recoverable
resources plus in excess of 300 mmboe identified mean prospective
resources
-- Work will now commence on a Field Development Plan ("FDP")
with, subject to funding, first oil targeted for 2024 - JOG fully
funded to submit the FDP
-- Equinor and JOG have agreed a 3 month option over a 50%
equity interest in respect of Blocks 20/5d and 21/1a (the "Buchan
Blocks")
Andrew Benitz, CEO of Jersey Oil & Gas, commented:
"We are delighted to announce this transformational event. Prior
to these awards, JOG's net share of discovered resources in Verbier
were estimated at 4.5 mmboe. Today's awards add an estimated 105
mmboe of discovered resources net to JOG, in addition to a material
uplift in new prospective resources. This represents a highly
significant value enhancing milestone for our shareholders
comprising 100% equity interests and operatorship of key
development ready assets with the potential to create a major new
area hub within the Greater Buchan Area.
These awards are the kind of value creating opportunities
available to nimble independent companies operating in the North
Sea today and stem from an intensive two-year work effort behind
the scenes by JOG to prepare today's winning applications. By way
of low-risk accumulation of discovered resource volumes, this is by
far the most significant event for JOG since its inception and we
are excited to start work on this new project immediately.
We are also pleased to enter into an option agreement with
Equinor, which serves to demonstrate JOG's efforts to successfully
collaborate and continue to strengthen our working relationship
with Equinor as Operator of Licence P2170."
Additional Information
Jersey Oil & Gas (AIM: JOG), an independent upstream oil and
gas company focused on the UK Continental Shelf ("UKCS") region of
the North Sea, is pleased to announce that it has been awarded,
subject to documentation, 100% working interests and operatorship
of three blocks in the OGA's 31(st) Supplementary Offshore
Licensing Round. This Greater Buchan Area ("GBA") acreage awarded
to JOG includes the Buchan oil field and the J2 (well 20/5a-10Y)
oil discovery.
The acreage awarded is contiguous with JOG's existing interest
in Licence P2170 (Blocks 20/5b and 21/1d) which contains the 2017
Verbier (J62-J64) oil discovery with a low case operator estimate
of approximately 25 mmboe of discovered resource in addition to
significant identified prospective resources, in which JOG holds an
18% working interest alongside the operator, Equinor UK Limited
(70%), and co-venturer CIECO V&C (UK) Limited (12%).
Together with its interest in the Verbier discovery, the new GBA
acreage provides JOG with a significant opportunity to potentially
establish and operate a future major new area development to access
more than 100 mmboe of discovered mean resources (refer to table 1
below) plus in excess of 300 mmboe of identified mean prospective
resources that are estimated to be present in the GBA.
Table 1: GBA blocks awarded to JOG with associated resource
estimates
Blocks Field/Prospect Unrisked Gross Recoverable Mean
Resources (mmboe)
Discovered Prospective
-------------------------- ---------------------- -----------------------
20/5d & 21/1a Buchan 82 -
-------------------------- ---------------------- -----------------------
Buchan Andrew 3 -
-------------------------- ---------------------- -----------------------
J2 Sgiath 20 -
-------------------------- ---------------------- -----------------------
21/1a Buchan Capri - 19
-------------------------- ---------------------- -----------------------
20/4c Zermatt - 30
-------------------------- ---------------------- -----------------------
Chamonix - 34
-------------------------- ---------------------- -----------------------
Courcheval - 8
-------------------------- ---------------------- -----------------------
Source: JOG Management's estimates based on OGA information,
data acquired by JOG from Repsol Sinopec Resources UK Ltd and
independent work completed by Rockflow Resources Ltd on behalf of
JOG.
The Company will now commence work to progress an FDP seeking,
subject to funding, to deliver a potential JOG-operated major new
area hub development in the medium term in line with the OGA's
Maximum Economic Recovery ("MER") strategy. JOG is currently fully
funded to compile and submit the requisite FDP. This proposed new
area hub will be planned to incorporate the redevelopment of the
Buchan oil field, together with the J2 oil discovery, with the
potential to include the development of the Verbier discovery as
well as other discovered and yet-to-be-found resources in the GBA.
First oil, subject to funding, will be targeted for 2024. JOG will
evaluate and determine the optimal sustainable development plan,
designed to deliver future phased and extended plateau
production.
The Buchan oil field was discovered by BP plc in the mid-1970s
and came onstream in 1981. Production continued until May 2017,
when the Buchan Alpha platform was no longer compliant with the
current Safety Case, by which point a total of 148 million barrels
("MMbbls") had been produced. Buchan oil is a light 33.5deg API oil
with low GOR (285 scf/bbl). JOG estimates that over 80 million
barrels of recoverable oil volumes remain to be produced from the
field.
JOG is also pleased to announce that Equinor and JOG have agreed
and entered into a three month option agreement under which Equinor
has been granted an option over a 50% equity interest in respect of
Blocks 20/5d and 21/1a (the "Buchan Blocks"), which contain the
Buchan oil field and J2 oil discovery. Should the option be
exercised, JOG shall act as Licence Operator in respect of the
Buchan Blocks and Equinor will reimburse JOG for its 50% share of
costs in relation to the licence applications.
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
Qualified Person's Statement:
The information contained in this announcement has been reviewed
and approved by Ronald Lansdell, Chief Operating Officer of Jersey
Oil & Gas, a qualified Geologist and Fellow of the Geological
Society, who has over 40 years' relevant experience within the
sector.
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 owns
an 18% interest in the P2170 licence, Blocks 20/5b & 21/1d,
Outer Moray Firth, in which the operator, Equinor UK Limited, owns
a 70% interest and CIECO V&C (UK) Limited owns a 12% interest.
This licence contains the 2017 Verbier discovery.
The Company plans to build an upstream E&P portfolio via
both organic development and acquisitions coinciding with the
cyclical recovery in the oil price and the opportune buying market
in the North Sea. The Company is involved in multiple acquisition
opportunities and intends to draw on its management team's
considerable experience, knowledge and expertise to deliver
shareholder value from its stated growth strategy.
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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