Jersey Oil & Gas shares jump as new well drilling agreed

Independent upstream oil and gas company Jersey Oil & Gas announced on Thursday that Statoil, the operator of its Verbier discovery, has awarded contracts for well drilling at the site.

Jersey owns an 18% interest in Verbier, which will see an appraisal well drilled by the semi-submersible rig West Phoenix in summer 2018, with the possibility of a further sidetrack well on the site in the Central North Sea.

Andrew Benitz, chief executive of Jersey Oil & Gas, said: "We are very pleased to announce that Statoil has contracted the West Phoenix, a sixth generation semi-submersible drilling rig, being the same class of rig that drilled the Verbier discovery well last year, to drill the Verbier appraisal well this summer."

Initial operator estimates of gross recoverable resources at the Verbier discovery are between 25 and 130mmboe with an estimated mean of 69mmboe.

"Confirmation of this contract at competitive market rates is in line with our previously announced Capex expectations for 2018 and this appraisal campaign will help determine the potential of our exciting Verbier discovery. In parallel with the appraisal well programme on Verbier, we are continuing our exploration activities to fully evaluate the remaining prospectivity of the P.2170 licence area," said Benitz.

Jersey is targeting working interests in six to ten producing fields and plans to construct this portfolio "via acquisitions coinciding with the cyclical recovery in the oil price and the current opportune buying market in the North Sea."

As of 1034 GMT, Jersey Oil & Gas' shares were up 9.66% to 210.00p.