Malcys blog27 Jan 2020 23:26
Jersey Oil & Gas- Malcys blog
A highly encouraging update from JOG this morning in which they have announced the acquiring of Equinor’s interest in licence P2170 for two milestone payments and a royalty depending on volumes produced from the Verbier discovery. Those payments are $3m on Verbier sanction, $5m on first oil and ‘certain royalty payments on the first 35 million barrels of oil produced from the Verbier Field calculated on the basis of a 70% working interest for on-block volumes’.
The deal increases 2C discovered resources over the GBA by 17.5 mmboe to 142 mmboe and adds exploration opportunities and simplifies ownership ahead of a potential farm-out. Money-wise it adds $506m post tax cash flow, taking GBA to $3.17bn net to JOG and increases estimated NPV of the GBA development project to $1.15bn.
In its operational review JOG talk of its highly experienced project team for the GBA development which is progressing to the development concept and the key project gate of concept selection by Q3 2020. At that stage the company will go ahead with the farm-out of the GBA which includes the Buchan, Verbier, J2 and Glenn oil discoveries plus exploration prospects. With year-end 2019 cash of £12m JOG is fully funded to Q2 2021 and JOG is working hard with the OGA to ensure that the GBA will introduce technologies that enable it to be at the forefront of the energy transition and of course modern hub thinking.
JOG is presenting a highly compelling story with $142m mmboe of recoverable oil resources, a huge potential hub and all this on the back of a company with a market cap of £30m and £12m in cash, a very exciting year beckons in a development with such excellent economics.
Https://www.malcysblog.com/2020/01/oil-price-predator-cerp-jog-dgo-and-finally/
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