AGM Update

Jersey Oil and Gas PLC

05 June 2024

 

5 June 2024

Jersey Oil and Gas plc

("Jersey Oil & Gas", "JOG" or the "Company")

AGM Update

Jersey Oil & Gas (AIM: JOG), an independent upstream oil and gas company ‎focused on the UK Continental Shelf region of the North Sea, is pleased to provide the following update on the Buchan redevelopment project ahead of today's Annual General Meeting ("AGM").

Following the announcement of an earlier than expected UK General Election in July 2024, the Buchan joint venture partners have assessed the implications and their plan for progressing the project.  While activities continue in order for the Buchan project to be ready for Field Development Plan ("FDP") approval by the end of this year, the exact timing for achieving this key milestone and enabling project sanction is naturally linked to securing fiscal clarity from the next government and ensuring that the project remains financially attractive.

The Buchan Operator, NEO Energy, continues to make good progress on advancing the work programme required to enable project sanction.  Completion of the necessary engineering work is on track and the first offshore survey was completed in May, obtaining the geophysical data used for the subsea and drilling rig contract tendering process.  A second survey to obtain geotechnical data is scheduled to commence this month.  Work is also advancing on completion of the other two key remaining workstreams, being the subsurface studies required to finalise the drilling programme and operational verification and preparation for the handover of the "Western Isles" floating production, storage and offloading vessel ("FPSO") to the Buchan joint venture.  Alongside these activities, engagement on the Buchan FDP and associated regulatory consents is progressing to plan with the North Sea Transition Authority ("NSTA") and the Offshore Petroleum Regulator for the Environment and Decommissioning.

Following the receipt of fiscal clarity and subject to FDP approval, the major contract awards and capital commitments for the project are now expected in 2025, which leads to Buchan first production being targeted for late 2027.  Under the current fiscal policy, the Company's valuation of the Buchan redevelopment project does not materially change as a result of the later first production date.

JOG remains fully funded with a current cash position of over £13 million and a forecast annual base cash spend of £3 million. The Buchan project remains fully carried to FDP with a further $20 million payment due following approval by the NSTA of the Buchan FDP and receipt of the associated regulatory and legal consents. The Company also has a full carry to first oil for its 20% equity interest in the Buchan field development costs, which are to be approved in the FDP.

Andrew Benitz, Chief Executive Officer, commented:

"With a UK General Election now announced, we are hopeful that fiscal clarity will be forthcoming in short order so that the industry can continue to do what it does best, namely investing in major capital projects that deliver vital low carbon homegrown energy and highly skilled jobs.  In the case of the Buchan field, we have a project that will deliver a meaningful contribution to the energy transition process through our electrification strategy, which helps facilitate investment in cutting-edge floating offshore wind."

Enquiries:

Jersey Oil and Gas plc	Andrew Benitz	c/o Camarco: 020 3757 4980
Strand Hanson Limited	James Harris Matthew Chandler James Bellman	Tel: [phone]
Zeus Capital Limited	Simon Johnson	Tel: [phone]
Cavendish Capital Markets Limited	Neil McDonald Leif Powis	Tel: [phone]
Camarco	Billy Clegg Rebecca Waterworth	Tel: [phone]

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Notes to Editors:

Jersey Oil & Gas (AIM:JOG) is a UK energy company focused on creating shareholder value through the development of oil and gas assets and the execution of accretive transactions. 

The Company has a focused asset portfolio centred on developing homegrown North Sea resources that support the UK's energy requirements as it transitions towards net zero.  JOG holds a 20% interest in each of licences P2498 (Blocks 20/5a, 20/5e and 21/1a) and P2170 (Blocks 20/5b and 21/1d) located in the UK Central North Sea and referred to as the "Greater Buchan Area" ("GBA").  Licence P2498 contains the Buchan oil field and J2 oil discovery and licence P2170 contains the Verbier oil discovery.

JOG's strategy is focused on unlocking the organic value of its GBA assets, combined with the pursuit of potential asset acquisitions that bring cash flow, diversity and quality investment opportunities into the portfolio.  The Company's Board and Executive team have a wealth of experience in managing and growing publicly listed energy companies and a strong track-record of value creation in the UK North Sea oil and gas sector.

Forward-Looking Statements

This announcement may contain certain forward-looking statements that are subject to the usual risk factors and uncertainties associated with an oil and gas business.  Whilst the Company believes the expectations reflected herein to be reasonable in light of the information available to it at this time, the actual outcome may be materially different owing to factors beyond the Company's control or otherwise within the Company's control but where, for example, the Company decides on a change of plan or strategy.

All figures quoted in this announcement are in US dollars, unless stated otherwise.

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 as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018, as amended by virtue of the Market Abuse (Amendment) (EU Exit) Regulations 2019.

 

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