UK-focused junior explorer Union Jack Oil reported Monday that drilling operations have started on its Keddington-5 sidetrack development well, which is located on the PEDL005(R) onshore license in the East Midlands, England.
The PEDL005(R) license incorporates the producing Keddington oilfield, which was discovered in 1998 by Candecca, as well as the two exploration prospects: Louth and North Somercoates. Union Jack acquired its 10-percent interest in the license last September, while operator Egdon Resources UK Limited retains a 45-percent holding.
Union Jack said that, under its acquisition agreement with Egdon, it will pay 20 percent of the costs of the Keddington-5 sidetrack well and 20 percent of the costs of the Louth exploration well – currently planned to spud sometime during 2016 and 2017.
The firm objective of the Keddington-5 well is to access undrained oil in place by drilling from the existing Keddington-4 well, which was also a sidetrack of the original Keddington-1Z well bore. Union Jack and its partners believe there remains an undrained volume amounting to some 309,000-to-566,000 barrels of oil beneath the Keddington-4 well.
Commenting in a company statement, Union Jack Executive Chairman David Bramhill said:
"Union Jack, with over GBP 3 million ($4.3 million) of cash and debt free, will continue to participate in attractive projects such as Keddington that offer realistic chances of success and the opportunity to add to its asset base at moderate cost."
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