JOG was founded in March 2014 with realistic ambitions. The Company was launched with the belief that a cyclical recovery in the oil and gas sector was, in time, inevitable. JOG quickly identified opportunity in the UK North Sea, which was enduring a sustained crisis following years of under investment, declining production and unsustainable high costs, against a backdrop of falling oil prices.

JOG was one of the few companies to see this as an opportunity and in August 2015 we became a public company, quoted on AIM through the acquisition of Trap Oil Ltd.  The combined entity was recapitalised, the balance sheet was cleaned up and following a share consolidation the company was relaunched as Jersey Oil and Gas plc. From this moment forward, JOG has had a clearly defined strategy to deliver shareholder value through extracting value from its existing exploration-focused asset portfolio and through pursuing an acquisition strategy primarily focused on development and production assets.

Against a backdrop of sub $30/bbl oil prices, JOG launched a farm-out process of our operated P2170 Licence in February 2016.  We were very encouraged by the response we received from multiple major oil companies and ultimately concluded a deal with oil major Statoil (whose name has subsequently changed to Equinor), who, like us, saw the significant exploration potential in the Verbier oil prospect.  JOG managed the process technically and commercially to achieve the best deal and retain maximum value.  This resulted in what we believe to be the first promoted farm out deal to be done in the UK North Sea in over three years, which led to a drilling commitment by Statoil for a summer 2017 well campaign.

2017 was a landmark year for JOG, as we were the catalyst for the drilling of three exploration wells in the UKCS one of which resulted in the highly publicised Verbier oil discovery.  Initial Operator estimates of gross recoverable resources were between 25 and 130 million barrels of oil equivalent (MMboe), with a minimum proven recoverable volume in the immediate vicinity of the wellbore of 25 MMboe.

JOG plc raised £2.4m gross from both new and existing shareholders, including management prior to the Verbier discovery. Post completion of the Verbier drilling campaign, with a cash position of approximately £1.8m, JOG’s ownership in the discovery was created from a net expenditure of just £0.6m.

On the back of the drilling success, JOG completed a significant equity financing of £24m, strengthening our shareholder base and positioning us to be well-financed for the near-term growth and development of the Company.

In early 2019, the Verbier appraisal well 20/5b-14 was safely drilled. This well did not encounter Upper Jurassic sands, as anticipated, resulting in our contingent resource volumetric estimations being revised towards the lower end of the initial resource estimate of 25 MMboe.

In August 2019, a transformational event occurred when, after significant effort and investment, JOG was awarded 100% working interests and operatorship of two blocks in the North Sea Transition Authority’s (NSTA) 31st Supplementary Offshore Licensing Round. The acreage awarded includes the Buchan oil field and the J2 oil discovery and is contiguous with JOG’s existing interest in Licence P2170 (Blocks 20/5b and 21/1d) that contains the Verbier discovery.  In late January 2020, JOG announced the acquisition of an additional 70% working interest in the P2170 Licence and assumed operatorship of the licence.  In November 2020, JOG announced the acquisition of CIECO V&C (UK) Limited, adding the remaining 12% working interest in Licence P2170 taking JOG’s ownership in the licence to 100%.

In September 2020, JOG was awarded a 100% working interest in, and operatorship of, part-block 20/5e in the NSTA’s 32nd Offshore Licensing Round.  Part-block 20/5e is located within JOG’s existing GBA development acreage and contains an extension of the J2 (well 20/05a-10Y) oil discovery. The part-block was incorporated within Licence P2498 (Blocks 20/5a & 21/1a) which contains the Buchan oil field and the J2 oil discovery and forms the basis of JOG’s proposed GBA development plans.

During 2023, the NSTA approved an extension to the Second Term of JOG’s P2498 (Buchan) and P2170 (Verbier) Licences, in keeping with the Company’s stated strategy of developing the GBA as an area-wide development plan.  The Second Term of the Buchan licence is until February 2025 and the Verbier licence until August 2026.  Prior to these deadlines, the joint venture partners are required to either submit appropriate Field Development Plans (FDP) for the approval of the NSTA or relinquish the licences.

In April 2023 JOG announced that it had agreed to farm-out a 50% interest and operatorship in the GBA licences to NEO Energy (NEO), a well-funded industry heavyweight and the fifth largest producer in the UKCS (Full deal terms can be seen here).  This was followed in November 2023 with the announcement that the Company had agreed to farm-out a further 30% working interest in the licences to Serica Energy (Serica), another leading UK oil and gas company, on identical pro-rata terms to the transaction with NEO (Full deal terms can be seen here).

In aggregate, the two transactions result in JOG retaining a 20% interest in the GBA licences, a full carry on the capital expenditure included in the approved Buchan FDP work programme and budget, plus a number of milestone cash payments.  Upon completion of the Serica Farm-out, which is expected in Q1-2024, the combined cash payments received from the two farm-outs will be over $18 million, with a further $20 million due to be paid to JOG upon approval of the Buchan FDP by the NSTA.

In November 2023 the GBA joint venture also announced it had agreed terms to acquire the Western Isles floating production, storage and offloading (FPSO) vessel, which is currently operating in the UK North Sea.  The FPSO is to be re-deployed and used as the processing facility for the planned redevelopment of the Buchan field.  Importantly, ahead of redeployment it is planned for the vessel to undergo a number of modifications to make it “electrification-ready”, such that is capable of being connected to one of the anticipated floating wind power developments that are intended to be located in close proximity to the GBA.

JOG’s acreage interest in the GBA is estimated to contain gross recoverable resources of over 100 MMboe, with additional material exploration upside potential.

The transactions announced during 2023, provide JOG with multiple cash payments, but most importantly, a fully funded 20% working interest in the Buchan redevelopment project.  This has transformed the Company and provides us with the springboard from which to realise long term shareholder value.

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MMBOE GBA RECOVERABLE RESOURCES