By HotStockRockets | Friday 23 April 2021
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Union Jack Oil (UJO) is “delighted to report that mobilisation in respect of well testing, initially on the West Newton B-1Z well, is expected to commence in May 2021”. That means that significant news flow is ahoy. And that will see the shares go higher.
The company has a 16.665% economic interest in PEDL183, onshore North of the river Humber, which contains the WNA-1, WNA-2 and WNB-1Z hydrocarbon discoveries – and re. which we’ve previously noted belief that West Newton is a large scale, conventional onshore oil and gas development asset with potential offshore sized resources in place.
Following that prior positive drilling, cased hole logging programme and vertical seismic profiling operations on the WNB-1Z well have been completed – with the former having now confirmed the presence of a good cement bond of the production liner and well bore integrity and initial indications of the latter that the data is of good quality. Activity now moves to perforation and stimulation of the Kirkham Abbey formation and subsequent flow testing of the well, moving on to testing of the WNA-2 well following that being completed on WNB-1Z.
Albeit house broker, SP Angel has a 176p share price target having particularly previously calculated a risked valuation of 122p per share for West Newton. With the noted prior positives providing confidence for positive flow tests and operations expected to take approximately four weeks to complete, we look forward to potential catalyst news flow from the current 35p share price – and this also particularly with recently achieved free flowing oil at Wressle too.
Therefore, certainly continuing to consider there operational and market sentiment catalyst potential for a swift return to the effective 60p+ of last summer, although comfortably up from a 28p offer price tip last year still, at up to 40p, a BUY.