How much can the Ugly Duckling deliver for Union Jack Oil ?
“…We are in a unique position. We were hitting record production and there’s no sign of it going away. We believe it’s a lot bigger…”
Five year’s ago, Union Jack Oil’s prize asset the Wressle onshore oil discovery was the ‘Ugly Duckling.’
Founder and executive chairman David Bramhill well remembers the pain associated with the asset in Lincolnshire “We couldn’t get planning permission. The oil price went to minus eighteen negative territory.”
And then the direction of the conversation changes with the addition of the grammatical conjunction ‘but’ because in the last 18 months “things have certainly blossomed.”
“All I can say is we were hitting record production. And there’s no sign of it going away. In the short term we believe it’s a lot bigger.”
The company’s initial expectations for Wressle was 500 barrels a day max. The reality was double that, but production has been reined in due to constraints related to gas flaring. The installation of microturbines will mitigate this by essentially burning the gas, reducing the flare and help the company ‘open the choke’ which Bramhill calculates will add 20% production to Wressle’s capabilities. Those capabilities, according to a report by international energy consultant GaffneyCline may be another 2.4 million barrels of oil.
In collaboration with ‘perfect partner’ Egdon Resources there are delicious add-ons being considered for Wressle such as putting the gas into the national grid and selling electricity produced via the gas.
Concurrent to the ambitions being developed for Wressle are the plans for West Newton described as ‘another Wressle.’ In fact, Bramhill thinks there are potentially another two Wressle’s in the portfolio that will take the company to mid-tier status.
Bramhill and the board are putting their cash where their ambitions are because very few junior energy companies pay a dividend and this is what Union Jack did when it paid a maiden dividend in October last year.
From Wressle to wrestling, which Bramhill knows about from a previous pastime, and the Chairman is literally wrestling with the concept of greed. As he explains to Sarah Lowther “We’re always on the lookout for production. There’s going to be some consolidation going on in the UK. On the bucket list it would be nice to bring even more production and more cash flow into a company.”
Listen to David catch up with Sarah Lowther on the Link below :
Watch (below) David talk to Proactive’s Andrew Scott about how the company expects Wressle to generate ‘well over’ £200 million in next decade from oil alone
Read energy consultant GaffneyCline’s assessment of Wressle
Take a tour of the company’s portfolio
Follow the company on Twitter @UnionJackOilplc
The author was remunerated but does not hold shares in the company