Europa Oil & Gas Holdings PLC (LON:EOG), Union Jack Oil PLC (LON:UJO) and its partners described the Wressle oil field development project, onshore UK, as “economically robust in the current low oil price environment”.
In a statement, the partners respectively conveyed the findings of the operator, Egdon Resources Plc’s (LON:EOG) updated model which estimated a US$17.62 per barrel break-even oil price for the project.
It is a boon for the project which struggled through the planning and permitting process, but, will now open up production of around 500 barrels of oil per day (bopd) – doubling net output for 30% stakeholder Europa and providing a key growth factor for Union Jack Oil, which owns 27.5%.
“The results of the updated economic model for Wressle confirm what we have long believed: that the project represents a low-cost opportunity to more than double Europa’s production to over 200 bopd,” said Simon Oddie, Europa chairman.
“With first oil targeted for H2 2020, I look forward to providing further updates on progress made towards bringing this UK onshore field into production.”
Union Jack chair David Bramhill, meanwhile, added: “Economic modelling demonstrates that the Wressle oilfield development is robustly economic at current oil prices … The Wressle oilfield remains one of our more advanced development projects within our business, with an expectation of first oil and associated cash flow in the second half of 2020.
"Progress on our other key projects, at West Newton and Biscathorpe, continues apace.
“We look forward to providing further updates on these two additional significant projects in our portfolio in the near future.”
Bramhill used Wednesday statement to highlight that Union Jack has more than US$6.2mln of cash and has no debt, leaving it funded for all testing and drilling commitments in 2020.
Wressle operator Egdon noted that initial work on site will be the installation of the groundwater monitoring boreholes with the main site operations occurring in the last months of the work stream.
The project timeline anticipates “first oil” during the second half of 2020.