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United Oil & Gas PLC on Friday saw shares jump as its development well at the Abu Sennan licence reached a drilling depth target under budget and according to schedule.
United Oil is a London-based explorer and producer with assets in Egypt, Jamaica and the UK. The Abu Sennan concession, its flagship Egyptian licence, is located in the hydrocarbon-producing Western Desert region, 200 kilometres west of Cairo.
The ASH-4 development well reached a depth of 3,956 metres on Monday, following on from the start of drilling in September.
Initial logs were acquired through the primary Alam El Bueib reservoir, and United Oil has subsequently estimated net pay at 20 metres for the target.
The company expects the well to reach target depth in the next few days, after which it will be tested and completed.
ASH-4 will then be brought on-stream through the existing ASH facilities. Once completed, the ST-1 rig will be moved to the ASW-1X location to start drilling, with a target of eight million barrels of oil gross recoverable resources.
"The ASH-4 well result marks a successful return to drilling on a prolific area of the Abu Sennan licence. Based on the initial petrophysical interpretation, we expect that this well will deliver a material increase to current production levels," said Chief Executive Officer Brian Larkin.
"The updated technical information from this well, and the three other producing ASH wells coupled with the reprocessed seismic, is expected to further enhance our understanding of the field which will support the optimization of the recovery of the material reserves and value."
United Oil shares were trading 8.9% higher at 1.72 pence each in London on Friday morning.
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