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Highlights:
- Union Jack Oil’s Taylor-1 well in Oklahoma is set to spud around October 31, targeting new and tested formations.
- The Taylor-1 well has a 40% chance of success, with Union Jack holding a 45% interest.
- The company is seeing returns on US investments and progressing UK projects with over $21 million generated from its Wressle field.
Union Jack Oil PLC (LSE:UJO) announced that the Taylor-1 well in Seminole County, Oklahoma, is expected to spud on or around October 31, marking a significant step in the company’s US-focused strategy. Taylor-1 will assess an untested prospect in the Hunton Remnant formation with secondary targets in the Wilcox sands, a formation known for its strong history of oil production in the region. Union Jack holds a 45% working interest in the project, with Reach Oil and Gas acting as the operator.
The prospect's geological chance of success is estimated at 40%, presenting promising potential for Union Jack’s latest venture. Executive chair David Bramhill highlighted the positive momentum that the company’s recent focus on US opportunities has generated. “The management decision in late 2023 to focus on opportunities in the USA has already delivered rewards in a short period, and I am pleased to report the imminent spudding of the Taylor well that has a good chance of success,” Bramhill stated.
Union Jack has been capitalizing on its US assets, particularly in the Andrews field, where it holds a 45% stake. The Andrews 1-17 and 2-17 wells have collectively produced 8,765 barrels of oil and 20,221,000 cubic feet of gas, generating returns of over 20% relative to the original capital investment. The Taylor-1 well will be followed by the Moccasin well, which targets the same Hunton and Wilcox formations, with drilling expenses covered by Union Jack’s existing cash resources.
While the company has seen growth in the US, Union Jack also remains committed to its UK assets. In the UK, its flagship Wressle oil field has delivered cumulative revenues exceeding $21 million, with Union Jack holding a 40% interest in this asset. Management believes the most productive phase of development at Wressle is still ahead, while ongoing improvements are being made at the Keddington field, where Union Jack holds a 55% stake and expects production to restart by late 2024.
Despite fiscal uncertainties in the UK’s upstream oil and gas sector, Union Jack remains profitable and optimistic about its growth strategy. The company is advancing its dual-region approach, aiming to leverage both its US and UK assets for continued revenue generation and future development.
