CPR upgrades Jamaica prospect to 229million bbls

RNS Number : 6645Q

United Oil & Gas PLC

21 February 2019

 

United Oil & Gas PLC / Index: LSE / Epic: UOG / Sector: Oil & Gas

21 February 2019

United Oil & Gas PLC ("United" or the "Company") 

CPR upgrades offshore Jamaica prospect to 229million barrels on Tullow Oil-operated licence

Highlights

·    High impact licence further upgraded by CPR based on new 2018 3D seismic data

·    229 MMstb of Gross Unrisked Mean Oil Prospective Resources has been assigned by ERCE to the high-grade undrilled Colibri prospect on the Tullow Oil-operated Walton-Morant licence, offshore Jamaica - an increase of 10 MMstb gross compared to previous estimates

·    The CPR assesses just one of a number of other structures the Company has identified in the licence

·    The increase in Gross Unrisked Mean Prospective Resources provides encouragement as progress is made towards a joint farm-down process

United Oil & Gas Plc, the London Stock Exchange listed oil and gas exploration and development company, is pleased to announce the results of an independent Competent Person's Report ('CPR') prepared by ERC Equipoise Ltd ('ERCE') covering the Walton-Morant licence ('the Licence'), offshore Jamaica. This includes an increase in Gross Unrisked Mean Oil Prospective Resources for the high grade undrilled Colibri prospect to 229 MMstb recoverable from 219 MMstb, and an increase in the geological chance of success. United holds a 20% equity interest in the 32,065 sq km Licence, with the remainder held by Tullow Jamaica Ltd ('Tullow'), a wholly owned subsidiary of leading independent oil and gas exploration and production company Tullow Oil plc (LSE: TLW).

ERCE was commissioned to update its 2017 volumetrics for the undrilled Colibri prospect following the acquisition of 2,250 sq km of state-of-the art 3D seismic data, the first ever acquired offshore Jamaica, in May 2018.  The CPR represents the culmination of a defined work programme to de-risk highly prospective Cretaceous and Tertiary-aged clastic and carbonate reservoir targets, including Colibri, that have been mapped by Tullow on 2D seismic data.  ERCE's updated volumetrics for Colibri are detailed in the table below:

Colibri Prospect, Walton-Morant Licence Tullow Oil Operated	Gross Unrisked Prospective Resources (MMstb) for Colibri prospect				UOG Net Mean Unrisked Prospective Resources (MMstb)	COS (%)
	1U	2U	3U	Mean
ERCE 2019 Estimate	30	128	513	229	46	20
ERCE 2017 Estimate	20	104	496	219	44	16

Notes:

1)     Prospects are features that have been sufficiently well defined through analysis of geological and geophysical data that they are likely to become drillable targets.

2)     "Gross Unrisked Prospective Resources" are 100% of the volumes estimated to be recoverable from an accumulation.

3)     "Net Mean Unrisked Prospective Resources" are UOG's working interest fraction of the mean estimate of the gross resources.

4)     Prospective Resources reported here are "unrisked" in that the volumes have not been multiplied by the geological chance of success (COS), nor have they have been multiplied by the chance of development (Pd).

5)     The COS is an estimate of the probability that drilling the prospect would result in a discovery as defined under SPE PRMS.

United Oil & Gas PLC CEO, Brian Larkin, said: "The high-grade undrilled Colibri prospect has not only passed robust and comprehensive technical scrutiny by an independent third party, but ERCE has seen fit to upgrade the gross Mean Unrisked Prospective Resources to 229 MMstb and to increase the likelihood of success.  This is a standout outcome, as it is not uncommon for volumes to be downgraded when structures, that have previously been identified on 2D seismic, are mapped on a 3D dataset.  The upgrade in the resources assigned to Colibri is testament to the work carried out by the partners, the quality of the licence and the strength of the geological model we have put in place.  The next step for Colibri would be making the decision to drill what could be a transformational well for United and with this in mind we are working closely with Tullow on a forward plan for the Licence.

"Gross Unrisked Mean Prospective Resources of 229 MMstb are eye-catching, particularly for a company of our size.  While not included in this CPR, we have identified a number of other structures which we believe would be significantly de-risked were a well targeting Colibri to be successful. 

"We have already seen considerable industry interest in the Walton Morant Licence.  This CPR and the ongoing seismic interpretation will provide additional impetus to the joint farm down process which we are confident will allow United to participate in this licence at a low-cost exposure, while continuing to offer considerable potential upside for shareholders."

ERCE has given its consent to the reference to its CPR in this announcement. ERCE confirms it has reviewed this announcement and confirms that the estimates of Gross and Net Unrisked Prospective Resources have been correctly extracted from the CPR.

The CPR has been signed by Mr Simon McDonald, Founder Director of ERCE, a Chartered Engineer and the Past President of The Society of Petroleum Evaluation Engineers (SPEE), who has over 40 years' experience in the evaluation of oil and gas fields and acreage, preparation of development plans and assessment of reserves and resources.

**ENDS**

For more information please visit the Company's website at www.uogplc.com or contact: 

United Oil & Gas Plc (Company)
Brian Larkin	[e-mail]
Optiva Securities Limited (Broker)
Christian Dennis	[phone]
Beaumont Cornish Limited (Financial Adviser)
Roland Cornish and Felicity Geidt	[phone]
Murray (PR Advisor)	[phone]
Joe Heron	[e-mail]
St Brides Partners (Financial PR/IR)
Frank Buhagiar and Juliet Earl	[phone]

Notes to Editors

United Oil & Gas plc (UOG) is listed on the main market of the London Stock Exchange. United was established to explore, appraise and develop low risk assets in Europe and to develop higher risk, higher impact exploration projects in the Caribbean, Latin America and Africa.

The following table outlines the Company's licence interests:

Country	Licence	Operator / Administrator	United Interest	Next Stage of Development
Italy	Podere Gallina Licence	Po Valley Operations Pty Ltd	20%	CPR complete Infrastructure build 2019 Production from Podere Maiar well expected in 2020 Evaluation of exploration opportunities continuing
UK	PL090 (Waddock Cross)	Egdon Resources UK Limited	26.25%	Development drilling targeted in 2019
UK	PL090 (Exploration)	Egdon Resources UK Limited	18.95%	Technical work to de-risk exploration targets continuing
UK	P1918* (Colter)	Corallian Energy Limited	10%	Colter drill underway Results due in March
UK	PEDL 330	Corallian Energy Limited	10%	Technical work to de-risk exploration targets continuing
UK	PEDL 345	Corallian Energy Limited	10%	Technical work to de-risk exploration targets continuing
UK	P2366* (Crown)	United Oil & Gas Plc	95%	CPR Complete Seismic reprocessing underway ahead of likely farm down process
Jamaica	Walton-Morant*	Tullow Jamaica Ltd	20%	CPR complete with significant upgrade Interpretation of seismic ongoing ahead of joint farm down process

*Offshore

Glossary of Technical Terms

bbl, bbls	barrel, barrels
bbl/d	barrels per day
CPR	competent person's report
MM	million
NPV	net present value
Prospective Resources	Prospective Resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective Resources have both an associated chance of discovery and a chance of development. They are further subdivided in accordance with the level of certainty associated with recoverable estimates assuming their discovery and development and may be sub-classified based on project maturity.
PRMS	The 2018 Petroleum Resource Management System (SPE)
SPE	Society of Petroleum Engineers
Stb 1U 2U 3U Mean	stock tank barrels Denotes the unrisked low estimate qualifying as Prospective Resources Denotes the unrisked best estimate qualifying as Prospective Resources Denotes the unrisked high estimate qualifying as Prospective Resources The sum of a set of numerical values divided by the number of values in the set

 

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