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United Oil and Gas sees production rising again in 2021


United Oil & Gas PLC (LON:UOG) said it expects production to rise further in 2021 as more of its acreage in Egypt comes onstream.

A farm-out process of the Walton prospect offshore Jamaica starts shortly with first gas from Italy also due this quarter, said the AIM-listed junior.

Production from the time it acquired its Egypt assets from Rockhopper at end-February 2020 averaged 2,195 barrels equivalent daily (boepd), generating total revenues of US$9-9.2mln net with an average U$37.7 price per barrel.

In 2021, United said it sees production rising to between 2,300 and 2,500 boepd on average in the first half with a reserve upgrade likely following the success of the El Salmiya 5 and ASH 2 wells.

Group cash at the year-end was US$2.1mln with US$5.3mln of capital spending planned for 2021 to be fully funded from existing operations.

Most of that has been earmarked for Egypt, UOG said, but US$0.6m will be spent on the Jamaican, Italian and UK assets.

Brian Larkin chief executive, added: “2020 was a successful year for United, delivering an excellent operational and financial performance, despite a challenging commodity price environment and the global pandemic.  

“United begins 2021 in a strong position with a balanced portfolio, low-cost growing production, high-quality reserves and a healthy balance sheet.

Our fully-funded, multi-well drilling programme in Egypt has begun with the result of the ASH-3 well expected shortly.

“This low-risk well has the potential to build on the successes of 2020 by delivering increased production and reserves.

“A formal farm-out process will shortly commence seeking partners to join us in unlocking the potential in our high impact Walton Morant exploration licence in Jamaica, and our Italian asset remains on track for first gas in 2021.”

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