Union Jack Oil plc (AIM: UJO), based in Bath, UK, is an onshore oil and gas company who has traditionally focused on British asset, but that’s starting to change. Over the past year or so, Union Jack has begun expanding across the Atlantic, building a second leg of its portfolio in the United States.
Today, the company’s projects span some of the most strategic plays in both regions. In the UK, it holds interests in the Wressle oilfield, West Newton gas project, Keddington, Biscathorpe, and North Kelsey. In the US, it’s rapidly assembling a portfolio of production, development, and royalty interests, particularly in Oklahoma, Texas, and other key shale basins.
What’s striking is that Union Jack is doing this while remaining profitable and debt-free, a rare position for a small-cap oil explorer. Management leans heavily on a “balanced, cash-flow driven” approach, aiming to fund growth from existing revenues rather than overextending. It’s a strategy that’s starting to pay off.
Let’s take a closer look at the projects, people, and potential behind this AIM-listed energy player.
Company Background
Union Jack Oil was founded in the 2000s as a UK-focused onshore explorer before securing a listing on the AIM market. David Bramhill, the company’s Executive Chairman with over 40 years of oil industry experience, has led much of its growth. His background includes serving as Managing Director of OilQuest, executive director at AIM-listed Nighthawk Energy, and advisory roles with majors like Shell, ExxonMobil, and BP. Alongside him is Joe O’Farrell, Executive Director and co-founder, who brings more than three decades of experience in energy and mining, having also worked with OilQuest and Nighthawk. The board is further strengthened by Graham Bull, a seasoned geologist with a 50-year career including senior exploration roles at Chevron, and Craig Howie, an Extel-ranked financial analyst with a background in oil and gas equity research. Together, this leadership team has overseen Union Jack’s evolution from a UK-centric operator into a dual-hemisphere energy company with growing ambitions.
Key UK Projects
Union Jack’s flagship UK asset is the Wressle oilfield, operated by Egdon. In 2024, it delivered around 416 barrels of oil per day gross, or 166.4 bopd net to Union Jack, at an average price of US$80.76 per barrel. The field has now generated more than US$23 million in cumulative revenue for the company, helping fund operations for several years. Over 700,000 barrels have been produced to date. A Report published in January 2024 upgraded 2P reserves to 2.373 million barrels of oil equivalent (BOE), a 263% increase driven by the reclassification of over 1.88 million BOE of contingent resources. Although planning approval for two new development wells was granted in September 2024, North Lincolnshire Council rescinded the decision following a legal challenge under the Supreme Court’s Finch ruling. A resubmission is now underway. Despite this delay, Union Jack believes Wressle can continue delivering significant revenues for at least another decade.
Another key project is West Newton, a significant onshore gas play located in East Yorkshire. Drilling programs between 2016 and 2022 encountered thick gas-bearing intervals in the Kirkham Abbey formation. According to RPS Group estimates, West Newton holds gross technically recoverable 2C resources of roughly 197 billion cubic feet of gas and nearly 600,000 barrels of condensate. A carbon intensity study by GaffneyCline gave the site an AA rating, the lowest possible emissions classification, reinforcing its potential role as a transitional, low-carbon gas project. A development plan is being finalised, including an updated emissions report to support a fresh planning application. With established pipeline infrastructure nearby, West Newton is strategically placed to supply domestic gas once approvals are secured.
At Keddington, Union Jack and its partner completed site refurbishment in 2024, and production is expected to resume around mid-2025. The operator has secured planning consent for a sidetrack well aimed at tapping undrained oil on the eastern flank of the field. Reservoir modelling suggests that this well could add 113,000 to 183,000 barrels of recoverable oil, depending on permeability outcomes. The project requires minimal capital and offers near-term revenue upside.
Further south, Biscathorpe represents a promising but delayed conventional oil play. In 2021, the Biscathorpe-2 well showed continuous oil fluorescence across a 68-metre Dinantian interval, with sampled oil measuring 33–34° API, similar to that produced at Keddington. Seismic reprocessing indicates a mean prospective resource of around 2.55 million barrels, with further upside in overlying formations. A planning appeal originally granted was later overturned after a judicial review, again tied to the Finch ruling. A new appeal process is pending. Despite the regulatory pause, Union Jack continues to regard Biscathorpe as one of the largest unappraised conventional onshore discoveries in the UK.
North Kelsey, meanwhile, is an undrilled onshore oil prospect, located along the same structural trend as Wressle. 3D seismic has identified four stacked Carboniferous reservoir targets. A revised resource assessment is underway. If Union Jack and its partners choose to proceed, a new planning application will be submitted. Although lower on the priority list, North Kelsey remains a potentially high-impact exploration play.
The company also holds a few smaller interests in decommissioned or impaired fields like Fiskerton, but these are non-core. Altogether, Union Jack’s UK portfolio offers a valuable mix: Wressle (and soon Keddington) supply steady production, while West Newton, Biscathorpe, and North Kelsey provide longer-term appraisal and exploration upside.
U.S. Operations and Royalties: Fast-Moving Growth, Proven Cashflow
Union Jack’s expansion into the United States has been swift and strategic. In under two years, the company has moved from a UK-focused player to a dual-hemisphere operator, building a material presence in Oklahoma and key shale basins through a joint venture with privately held Reach Oil & Gas and a fast-growing mineral royalty portfolio. The approach is clear: acquire low-cost, high-return stakes in producing and near-term wells while generating unencumbered cash from royalty income.
The flagship U.S. venture is the Andrews Field in Oklahoma’s Seminole County. Comprising the Andrews 1-17 and 2-17 wells, both targeting the Hunton Limestone, the field has already produced over 50 million cubic feet of clean gas and 10,000 barrels of ultra-light crude (45.5° API) since start-up in 2024. Reach Oil & Gas, the operator, estimates another 1.2 billion cubic feet of recoverable gas, with a projected 20-year field life. Notably, operating costs remain below $5 per barrel of oil equivalent, making Andrews a model of early payback and capital efficiency.
Next came the Moccasin 1-13 well in Pottawatomie County. Drilled in late 2024, the well flowed over 600 barrels per day on initial tests from the 1st Wilcox formation and is currently producing 80–100 bopd on a constrained basis as the team optimizes completion. Permanent production infrastructure is already installed, and with two additional hydrocarbon zones (Bartlesville and Red Fork) yet to be tested, Moccasin offers material upside.
Nearby, the Rogers Enhanced Recovery Project is targeting secondary oil from two legacy wells using water injected from Andrews. Operator estimates suggest up to 124,000 barrels can be recovered, generating around US$5 million in revenue with IRRs approaching 60%. Early signs show promising pressure build-up in the reservoir.
The fourth well, Taylor 1-16, was drilled to 4,577 feet and intersected multiple zones, including the Cromwell and Hunton formations. Both flowed oil, Cromwell production has already been sold, and Reach plans hydraulic fracturing and artificial lift to maximize output. With costs already sunk and the well at completion stage, Taylor is another potentially lucrative step in the growing Oklahoma pipeline.
In parallel, Union Jack has acquired a portfolio of mineral royalties that now span over 165 well interests across six packages. These include three assets in the Permian Basin (Midland, Upton, and Howard Counties), a 96-well package in the Bakken (North Dakota), and a 9-well unit in the Eagle Ford Shale (Texas). Operators include industry majors such as Chevron, ExxonMobil (via XTO), ConocoPhillips, Occidental, and Hess. These royalties, which carry no capex or operating costs, generated £196,737 in revenue in 2024 (up from £35,000 in 2023) and are expected to deliver IRRs exceeding 25% over multi-decade timeframes.
Beyond direct economics, U.S. operations offer clear structural benefits. The regulatory and fiscal environment is seen by Union Jack as far more accommodating than the UK, especially following the imposition of the Energy Profits Levy and legal setbacks under the Finch ruling. Oklahoma and Texas offer streamlined permitting, lower taxes, and faster payback, a compelling backdrop for continued expansion.
Together, Union Jack’s U.S. assets provide not only geographic diversification but also a pipeline of near-term production and royalty-driven cashflow. With multiple well results exceeding expectations and further drilling in the pipeline, the American leg of the business has moved from experiment to key growth engine.
Financial Position and Funding: Profitable, Prudent, and Positioned for Growth
Union Jack Oil remains a rare breed in the junior oil and gas sector: profitable, cash-generative, and entirely debt-free. For the full year 2024, the company reported revenue of £3.93 million, down from £5.07 million in 2023 due to lower production from UK assets during regulatory delays. Despite this, Union Jack still delivered a net profit of £649,213 and a gross profit of £1.97 million.
Earnings per share came in at 0.61 pence (2023: 0.79p), while cash on hand declined to £2.53 million, down from £5.20 million the year prior. The reduction reflects a £266,416 dividend paid out in July 2024 and continued reinvestment in U.S. assets. The company also retains 6.3 million shares in treasury, which carry no voting rights or dividend entitlement but serve to boost EPS.
Crucially, Union Jack holds no bank debt, offering it balance sheet flexibility in uncertain markets.
The company’s funding model focuses on internally generated capital. Strong cashflow from Wressle and early-stage U.S. production has supported new investments, most notably, farm-ins at West Bowlegs (45%) and Wilzetta (75%) in Oklahoma. To expand its reach with North American investors, Union Jack listed on the OTCQB market in April 2024, trading under the ticker UJOGF.
The July 2024 dividend of 0.25p was fully funded from earnings, reflecting management’s confidence in continued profitability. Meanwhile, the company’s U.S. royalty portfolio delivered £196,737 in 2024 revenue, up from just £35,142 the prior year, offering repeatable, high-margin income without capex.
There are equity-based funding levers in place. As of year-end, Union Jack had 3.05 million outstanding share options, all issued before 2020 and exercisable only if the share price rises well above the strike price. While no major new placements have been announced, the company retains the flexibility to issue from treasury or raise fresh equity should a high-value project require funding.
For now, Union Jack’s strategy remains disciplined: fund growth organically, reward shareholders when feasible, and avoid unnecessary dilution.
Strategy and Market Positioning: Balanced Growth, Transatlantic Leverage
Union Jack Oil positions itself as a low-cost, cash-generating exploration and production company, pursuing a strategy of appraising and developing assets on both sides of the Atlantic. In practical terms, the company uses cash from mature UK production, particularly from Wressle, to fund high-return drilling programs in the United States.
Management has been vocal about the ease of entry and attractive tax structure in Oklahoma, which they cite as key reasons behind the U.S. pivot. In contrast, the UK portfolio provides a stable revenue base through producing and near-term development assets, with projects like West Newton offering scale and strategic relevance.
Union Jack’s model benefits from strong macro tailwinds. Global oil prices remained consistently above $70–80 per barrel throughout 2024, sustaining profitability across its onshore footprint (although it’s worth noting that prices are closer to $60 per barrel at the time of writing). In the UK, renewed emphasis on domestic energy security and a potential supply gap have drawn attention to gas-weighted projects like West Newton. The company continues to promote its AA-rated “low-carbon” gas supply, aligning with the UK’s net-zero objectives.
Meanwhile, the U.S. energy landscape remains supportive, with pro-drilling policy environments and strong infrastructure across Oklahoma and Texas. By operating in both jurisdictions, Union Jack balances risk: slower planning and taxation challenges in the UK are countered by the flexibility and speed of execution offered by U.S. shale basins. This geographic diversification has become a cornerstone of the company’s growth strategy.
The board remains optimistic about future catalysts. These include the reapproval of Wressle’s development plan, final well completions in Oklahoma, such as Taylor 1-16, and further infill drilling at Moccasin and Rogers. With continued reinvestment of cashflow into drilling, Union Jack aims to expand reserves organically. If commodity prices hold, this disciplined, returns-focused model could translate into material shareholder value.
Risks and Challenges
As with any small-cap exploration and production company, investors should weigh a range of risks when assessing Union Jack Oil’s investment case.
UK planning delays remain a persistent challenge. In 2024, North Lincolnshire Council rescinded Wressle’s previously approved development consent following a third-party legal challenge tied to the UK Supreme Court’s Finch ruling. A revised application is in progress, but the episode highlights how permitting in the UK can stall even well-established projects. Biscathorpe faced a similar reversal, and timelines for resolution remain uncertain. These delays can defer revenue and add administrative costs.
The UK’s Energy Profits Levy also weighs on profitability. While Union Jack qualifies for a lower effective rate of 38%, management has called the levy “punitive” and cited it as a key reason for expanding into the United States. Even at the reduced rate, taxes on UK production erode margins and reduce reinvestment capacity.
Operational risk is not absent in the U.S. either. While Oklahoma offers a far more efficient regulatory environment, technical risk remains. Wells like Taylor 1-16 have confirmed hydrocarbons but require hydraulic fracturing and artificial lift to maintain flow. Reservoir performance may vary, service costs could rise, and success is closely linked to partner Reach Oil & Gas. Any delays, underperformance, or macro volatility, especially in U.S. natural gas pricing, could impact cash flow and timelines.
Union Jack has no debt, but growth may at some point require new capital. While the company holds treasury shares and has avoided major dilution so far, share options remain in place, and the board retains the ability to issue equity to fund large projects. Investors should monitor any announcements regarding placements, warrants, or changes to the capital structure.
As a modestly capitalised AIM stock, Union Jack is also exposed to wider volatility. Share liquidity can be thin, and exploration results or regulatory updates often drive sharp moves. Additionally, all resource estimates, especially in early-stage projects, remain subject to change as appraisal and production evolve.
Conclusion: A Disciplined Energy Play with Transatlantic Leverage
Union Jack Oil has quietly become one of AIM’s more compelling energy stories. With a profitable core in the UK and a fast-growing, high-return portfolio in the U.S., it combines cashflow with optionality in a way that few small-cap E&Ps manage. Its balance sheet is clean, its dividend is covered, and its U.S. wells are already producing tangible results. Yes, there are headwinds, planning delays at home, technical hurdles in Oklahoma, but Union Jack’s strategy of geographic and operational diversification positions it well to weather both.
For investors seeking exposure to small-cap oil and gas with income, growth, and a clear plan for reinvestment, Union Jack may represent a quietly resilient pick in a volatile sector. The company is not betting everything on a single basin or project, and in today’s market, that balance matters.
Disclaimer
This article is for information purposes only and does not constitute investment advice. The author is not a registered financial advisor, and investors should do their own research or consult a professional before making investment decisions. The opinions expressed here are those of the author and do not necessarily reflect the views of Union Jack Oil plc or its management.
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