Union Jack Oil PLC (LON:UJO) was given a reiterated ‘strong buy’ recommendation from broker SP Angel after it said well testing operations are expected to begin in May.

Keeping its price target at 176p, the broker said analysis of the recent drilling campaign gave investors “clear line of sight” on the much-anticipated extended well tests on both the WNB1Z and WNA-2 appraisal wells.

The analysts said they “would also not be surprised to see a material in uplift volumetrics given the highly successful drilling reports, notwithstanding the thicker structure and contiguous nature of the Kirkham Abbey formation between the A and B sites, but also the elevated mudgas concentrations observed”.

With UJO and the joint venture partners considering a 3D seismic programme over other structures which have been highlighted within the licence area, the analysts said “the short to medium term will focus on maturing this play further to commercialisation, in addition to proving up analogue fields across the project area”.

Now well funded and debt free, with its 40%-owned Wressle now onstream and acquisitions of material stakes in its core assets underpinned by continued success with the drill-bit, the broker’s conclusion was that Union Jack “has the potential to transition from a junior E&P company into a self-sustaining mid-tier hydrocarbon producer”.

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