Shares of Union Jack Oil (LON: UJO) are edging higher on Wednesday after the company provided an update on the ongoing testing of the West Newton B-1Z well located within the Western Sector of the Southern Permian Basin, North of the River Humber, UK.
The company holds a 16.665% economic interest in PEDL183, encompassing an area of 176,000 acres. It contains the WNA-1, WNA-2, and WN B-1Z hydrocarbon discoveries.
The AIM-listed firm said an initial interval of 25m of the 62m Kirkham Abbey hydrocarbon column was perforated with well testing operations beginning on the 7th of June.
An initial focus was put on the lower portion of Kirkham Abbey with the scale of completion fluid inflow into the formation indicative of permeability in the system.
Gas is currently being recovered to the surface under test conditions. It is exhibiting “a strong similarity to analyses obtained from the West Newton A site wells with samples showing approximately 90% methane content and no native H2S (hydrogen sulphide),” UJO said.
They are now analysing the liquids recovered, while there has been an additional 19m zone in the upper Kirkham Abbey identified for perforation and flow testing.
Operations continue on the clean-up of the lower portion of the Kirkham Abbey and further flow testing of the Kirkham Abbey formation.
“We are encouraged by the indications of permeability of the lower portion of the Kirkham Abbey under test, and the initial recovery of hydrocarbons to surface,” stated David Bramhill, Executive Chairman of Union Jack.
“We are continuing with test operations in this zone which, along with the planned testing of additional zones, and the A-2 well, the results of which will be key data inputs into the ultimate development plans of PEDL183,” he added.
The company’s shares are currently trading at 27.6p, up 0.36%.
Should you invest in Union Jack Oil shares?
UJO shares are traded on the London stock exchange’s AIM market (the alternative investment market), which is the submarket specifically for smaller companies. AIM stocks are attractive to investors as they have tax advantages and smaller companies have the potential to benefit from rapid growth. But are Union Jack Oil shares the best buy? Our stock market analysts regularly review the market and share their picks for high growth companies