How is it doing
In the latest North Sea licensing round by the Oil and Gas Authority, Jersey was awarded significant acreage, making up for some disappointment with recent drilling results in another block a few miles away at Verbier.
Jersey landed 100% of three blocks hosting the Buchan oil field and the J2 oil discovery, acreage adjoining JOG's existing interest in Licence P2170, which contains the Verbier discovery.
The Greater Buchan Area, including the parts within P2170, is estimated to contain more than 100mln barrels of oil equivalent in discovered mean recoverable resources.
Equinor, Jersey’s partner at Verbier, has agreed an option deal for a 50% interest in the Buchan Blocks. It has three months to make a decision.
Recent drilling at Verbier, situated 100km north-east of Aberdeen, did not hit the quantities of oil expected but still found a potentially commercial 25mln barrels and chief executive Andrew Benitz told investors that there is “still plenty to play for” at the project.
The well failed to upgrade Verbier’s resource base, with the discovery now believed to host closer to 25mln barrels than 130mln.
Equinor, as Verbier's operator, will carry out a full re-evaluation of the licence area, including an assessment of additional deeper targets and the other previously identified exploration opportunities, including Cortina.
A large part of the mapped area located to the north remains untested and additional resource upside potential was identified in a deeper horizon beneath the Verbier discovery.
What the CEO says
"We are delighted to announce this transformational event,” said Jersey chief executive Andrew Benitz after North Sea licence award on 22 July.
“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.”
Benitz added: “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.”
Jersey Oil & Gas’s ambition is to build a sizeable North Sea-focused business and is looking for acquisitions to further that goal.
Last year, the company said that the revival in activity in the North Sea meant it had been priced out of some deals.