Shares in Dublin-based exploration company United Oil and Gas jumped more than 12% on the news of it buying into three licences in the south of England.
The company, established by former Tullow Oil executives, has taken a 10% share of three licences operated by privately-owned British explorer Corallian, and has an option to buy a further 10% of them.
In return, United will cover over 13% of the costs associated with drilling one of the prospects, the Colter well, in the second quarter of this year.
The Colter discovery lies adjacent to the Wytch Farm field, on England’s south coast, which has produced more than 450 million barrels of oil.
Wytch Farm is currently ranked as the largest oil field in Europe.
The total costs of the drill will be around £7m (€7.87m), of which United’s share will be around £933,100 (€1.05m).
The new licences give United both an onshore and offshore presence in the UK, where it already has one licence.
In addition, United and Corallian have agreed to jointly identify and target further opportunities in the same area.
“This, our second cluster of UK licences and fourth in total, gives United’s shareholders access to a near-term, drill-ready target in a highly prospective region,” said United Oil’s chief executive Brian Larkin. United has stated its plan is to build a presence in Europe, Latin America and Africa.
It recently bought into one of Tullow Oil’s prospects in Jamaica and saw initial positive results from its maiden drill in Italy.