United Oil reports 'material increase' in Abu Sennan reserves

(Sharecast News) - United Oil & Gas updated the market on the Abu Sennan concession, onshore Egypt on Wednesday, reporting that an independent reserves and resources report, relevant to the end of 2020, indicated a "material increase" in reserves.
The AIM-traded firm holds a 22% working interest in the licence, which is operated by Kuwait Energy Egypt.

It reported a 24% increase in gross 2P reserves to 16.8 million barrels of oil equivalent, from 13.5 million barrels at the start of 2020, representing a near-200% reserves replacement ratio, before the recent drilling success at the ASH-3 and ASD-1X wells.

Gross 1P reserves, meanwhile, were up by 59% to 6.7 million barrels of oil equivalent, and gross 3P reserves were 21% higher at 34.7 million barrels.

The board said "significant" additional growth opportunities were evaluated in the report, noting 21 exploration prospects, many with multiple reservoir targets.

"It is really pleasing to see the Abu Sennan assets continuing to perform so strongly, and so consistently, with a reserves replacement ratio of over 190% for the second year in a row," said chief executive officer Brian Larkin.

"We remain confident that the Licence has much more to offer, and indeed, these upgraded reserve numbers take no account of the successes already achieved so far during the 2021 drilling campaign."

Larkin said the report "significantly" increased the company's understanding of the potential of the asset, pointing to 21 potential exploration targets.

"With further development drilling due to commence shortly at Al Jahraa, and further development and exploration targets identified across the licence, we are looking forward to further news flow and growth from Abu Sennan, both in the coming months and in the longer-term."

At 1410 BST, shares in United Oil & Gas were up 2.92% at 4.94p.