Aim-listed Union Jack Oil’s shares soared over 30 per cent in early trading and closed 19 per cent higher after it said an independent review of shale resources at a site near Nottingham, in which it owns a 10 per cent stake, had found 5.4bn barrels of oil and over 2.7 trillion cubic feet of gas.
Egdon Resources, which owns a 32.5 per cent stake in the area, saw its shares close eight per cent higher.
The broader sector was lifted after it emerged that the Department of Energy and Climate Change had invited shale gas firms in for talks yesterday, to discuss how the long-awaited 14th onshore oil and gas licensing round would function. “There was a meeting to discuss with interested companies how Decc might conduct the technical assessment of applications, if ministers decide to go ahead with the round,” Decc confirmed.
Shares in IGas, which has begun exploratory drilling for shale gas near Manchester, closed 2.7 per cent higher.
“Everyone is excited about UK shale. It had been rumoured that the next licensing round was going to be in June, but now it actually looks likely to happen,” Andrew Monk, chief executive of VSA Capital, told City A.M.
The UK government has been highly supportive of shale gas, hoping for a US-style boom that will boost energy security and bring in tax revenues.