Oil explorer to dig into seabed for oil samples but no wells yet
Published:Friday | October 4, 2024 | 12:07 AM
United Oil and Gas Plc is awaiting a licence to begin collecting samples from beneath Jamaica’s seabed, for additional data in its hunt for oil.
“As we move forward, our primary focus remains on Jamaica, which we believe offers transformative potential for United. The planning and permitting processes for the piston core sampling is advancing, with permits expected in early 2025,” said United Oil CEO Brian Larkin in a market filing.
“We remain engaged with a number of interested parties as we continue to progress the farm-out process,” he said, referring to efforts to secure a drilling partner to share the investment risk.
The machines utilised for piston core sampling typically descend hundreds of metres into the seabed and penetrate the core up to 18 metres to extract sediments and mud. The samples will be analysed for traces of hydrocarbons.
United is hoping that the samples will deliver data that will raise the chances of an oil discovery offshore Jamaica. The odds of a commercial find were last estimated at 25 per cent, but the company expects to raise that to 33 per cent, based on past statements.
United Oil’s previous work included conducting 2D and 3D surveys of the exploration area, which identified subsurface structures resembling oil deposits. The potential value of its most promising reservoir was independently estimated at US$23 billion, which could be extracted over a span of 25 years. There are other reservoirs within the company’s licence to explore 22,400 square kilometres offshore along the island’s southern coast, known as the Walton-Morant zone.
“Jamaica remains our primary driver for growth, with the licence offering significant exploration potential. Our focus is now firmly on advancing the project and progressing the ongoing farm-out process to unlock its value, and currently working with a number of interested parties,” said Larkin.
United Oil’s Jamaican operations are now overseen by Herona Thompson.
The UK-based company is now trying to sell its 22 per cent stake in Egypt, after its partner there halted operations, partly due to foreign exchange restrictions. It leaves the Waddock oil development project in the UK, in which it has a 26 per cent stake, as its only active asset.
United Oil made a loss of US$1.6 million at half-year, reversing the profit of US$600,000 reported in the comparative period in 2023.