United Oil moves closer to possible offshore drilling in Jamaica

United Oil & Gas is taking another step toward potentially drilling for oil offshore Jamaica, commissioning a study to determine what equipment, costs and logistical support would be required for an exploration well.

The UK-based company has hired NRG Well Management to examine the availability and cost of offshore drilling rigs, equipment procurement timelines and the supply chain needed to support possible drilling in the Walton-Morant area off Jamaica’s southern coast.

The study does not mean drilling has been approved or will definitely take place. Instead, it is intended to help United prepare for drilling if it secures an investment partner and receives the necessary approvals from the Jamaican Government.

United has been searching for a partner to help finance the costly drilling phase of the project. The company has said its farm-out process — under which another company would invest in the project in exchange for an interest in the offshore license — remains ongoing.

The latest move follows years of exploration in the Walton-Morant area, where United holds a 100% working interest in a 22,400-square-kilometer offshore block.

United estimates that the area could contain more than 7 billion barrels of prospective resources. However, that figure does not represent a confirmed oil discovery. It is an estimate based on geological and seismic data, and drilling would be required to determine whether commercially recoverable oil is actually present.

The new study will focus particularly on two potential drilling targets — Colibri and Thunderball.

United estimates that Colibri could contain an average prospective resource of about 406 million barrels, while Thunderball could hold about 603 million barrels. Together, the two targets have estimated prospective resources of more than 1 billion barrels.

NRG will examine which offshore rigs would be suitable for the sites and how much they could cost to operate. Colibri is in water about 750 meters deep, while Thunderball is in significantly deeper water of approximately 1,900 meters.

The company will also examine how long it would take to obtain specialized drilling equipment and services, as well as potential supply and logistics support from Jamaica, the Gulf of Mexico, Guyana, Suriname and Trinidad.

“This drilling study marks an important step in our operational planning to advance the Walton-Morant Licence towards a potential future drilling programme. It will provide a current, market-based assessment of rig suitability, availability, commercial conditions, and the long-lead items required to drill Colibri and Thunderball or similar targets,” United Oil & Gas Chief Operating Officer Donal Meehan said.

“Colibri and Thunderball represent substantial exploration opportunities within the Licence, with a combined potential of over 1 billion barrels of mean prospective resources out of the 7 billion barrels of prospective resources identified on the licence to date,” he added.

“By undertaking this study now, we are positioning the Company for operational readiness ahead of future drilling, whilst providing valuable information to support our on-going work as we push to conclude the Jamaican farm-out process. We look forward to updating the market with the study results in the coming weeks.”

United’s involvement in the Walton-Morant area dates back to 2017, when it acquired a 20% interest in the offshore license from Tullow Oil. Tullow later withdrew from the project, and United took over the license with a 100% working interest in 2020.

The Jamaican Government subsequently granted extensions allowing the company to continue exploration and its search for an investment partner. Its current extension runs until January 2028, giving United additional time to advance plans for a potential exploration well.

Earlier this year, Energy Minister Daryl Vaz expressed cautious optimism about the exploration program after United completed a geochemical survey of the area.

Preliminary analysis detected C4 and C5 hydrocarbons — butanes and pentanes — in some samples. The findings could provide additional evidence of an active petroleum system, but they do not establish that Jamaica has commercially viable oil reserves.

Vaz said in April that several companies had expressed interest following the results and that United was holding discussions with potential investors.

He also cautioned that even if a partner is secured, offshore drilling would likely not take place until late 2027 or 2028.

Any drilling would also require the necessary approvals and commercial agreements with the Jamaican Government.

United said the NRG study is expected to be completed within the coming weeks.