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(Sharecast News) - Union Jack Oil announced on Tuesday that its Taylor-1 well in Seminole County, Oklahoma, is set to spud around 31 October.
The AIM-traded company holds a 45% working interest in the well, targeting the Hunton Remnant prospect with additional exploration in the Misener and Wilcox sands.
Historical production from nearby Wilcox structures in the 1920s yielded thousands of barrels per day, while regional fields like Bowlegs had produced extensively from similar reservoirs.
The firm said the Taylor-1 well was supported by 3D seismic data, with operator Reach Oil and Gas estimating a 40% geological chance of success.
Following Taylor-1, Union Jack said it planned to drill the Moccasin well, also with a 45% working interest.
Moccasin targeted Hunton and Wilcox formations, with additional exploration in the Pennsylvanian Channel Sands.
Situated near the Wilzetta Fault, the Moccasin prospect benefitted from regional geological structures that historically led to significant oil accumulations.
Drilling and completion costs for both Taylor-1 and Moccasin would be funded from Union Jack's existing cash reserves.
Reach estimated a high likelihood of discovering movable hydrocarbons in Moccasin's Base Pennsylvanian Sands, with a roughly 50% success chance in other target zones.
"The management decision in late 2023, to focus on opportunities in the US, has already delivered rewards in a short period and I am pleased to report the imminent spudding of the Taylor well that has a good chance of success," said executive chairman David Bramhill.
"One year on, our entry into the US is already generating cash flow from the Andrews field and Mineral royalty portfolio where returns of 20%+ are being seen in respect of our original capital investment.
"The successful, now predominantly gas producing Andrews 1-17 and 2-17 wells, forming the Andrews field, in which Union Jack holds a 45% working interest, have to date produced 8,765 barrels of oil and 20,221,000 cubic feet of gas."
Bramhill added that in the UK, the company recorded cumulative revenues of over $21m from Wressle, net to its 40% interest, where its view was that the most productive phase of development was still to come.
"Also in the UK, ongoing site improvements to the Keddington production asset, where Union Jack holds a 55% interest, are progressing well and production is expected to re-commence during late 2024.
"Despite the current fiscal uncertainty that overshadows the UK upstream, Union Jack remains profitable and the Board is committed to delivering on its stated growth strategy in both the US and UK."
At 1255 GMT, shares in Union Jack Oil were down 0.51% at 9.7p.
Reporting by Josh White for Sharecast.com.