Jersey Oil and Gas PLC (LON:JOG) shares jumped higher on Monday as the explorer said it continues to see the positives for the Verbier oil discovery, as it looks forward to the receipt of new seismic data and a detailed re-evaluation of the project.
Everyone was disappointed with the result of the Verbier-2 appraisal well, which last month failed to encounter its targeted reservoir, though untested potential remains for the project.
Originally, the discovery was estimated to host 25mln to 135mln barrels of crude and, in the wake of Verbier-2, it was thought that the actual size of the asset is closer to the low-end of that range.
In financial results statement for the twelve months ended 31 December 2018, published on Monday, the AIM-quoted explorer said that final seismic data sets are expected before the end of June and those findings will feed into a technical re-evaluation being undertaken by Equinor, the project operator.
Equinor will pull in an assessment of deeper targets and other, previously identified, nearby exploration targets.
JOG pointed out that a large part of Verbier’s mapped area - the north west portion - has yet to be tested and it separately noted that the upcoming 31st Supplementary Offshore Licensing Round may be “highly beneficial to the Verbier discovery” as it could help enhance the project’s commercial viability.
"JOG continues to benefit from our initial Verbier oil discovery announced in 2017, notwithstanding the recent appraisal well results,” said Andrew Benitz, JOG chief executive.
“We look forward to delivery of the new 3D seismic data and working with our co-venturers on assessing potential future appraisal and exploration drilling opportunities on the licence area. “
Benitz added: “Additionally, we are excited by the potential for a new area hub catalysed by the 31st Supplementary Offshore Licensing Round and the positive impact we believe this will have for Verbier.
"The company benefits from a strong funding position and we are optimistic that we can create value for shareholders through our core asset base, with multiple catalysts that exist for the Company through the remainder of 2019."
In terms of the 2018 financial results, JOG reported a £1.99mln loss for the year. It ended December with £19.7mln of cash and equivalents, though the Verbier-2 programme has followed since.
In afternoon trading, shares in Jersey O&G were 22.6% higher at 70.50p.
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