United Oil & Gas PLC (LON:UOG) has seen its price target lifted by stockbroker Cenkos to factor in its latest expectation beating success in Egypt and improved crude oil prices.

Results from the ASH-3 well were announced on Wednesday with the company reporting a maximum rate of 7,720 barrels oil equivalent per day, comprising 6,379 barrels of oil and 6.7mln cubic feet of gas.

On a choke reduced to conditions that are representative of production, the well yielded a rate of 4,140 boepd, as 3,561 bopd and 2.9mln cubic feet of gas.

United told investors it expects the well will be brought onstream in the coming days.

Cenkos repeated a ‘buy’ recommendation with a new price target of 28p, up from 26.6p.

“A year-on from the completion of the Rockhopper Egypt acquisition, we would argue that the Abu Sennan licence has delivered ahead of all expectations,” said analyst James Mccormack.

“Since acquiring its 22% working interest, United and its partners have drilled three wells, with all three encountering hydrocarbons – a 100% success rate.

“Over the same period, (and despite the volatile commodity price environment and the Covid-19 pandemic), production has increased by 36% to 2,310boepd during January 2021.”

The analyst added: “We update our model with the latest Brent forward curve, increasing our price target to 28p, c.7.8x the current share price.

“We also update our value of United’s Core NAV (the discounted forecast future net cash flows from on-stream fields (Abu Sennan) and fields which are due onstream in the next 12 months (Selva), minus the value of central office G&A cash costs, adjusted for net debt/cash) at 4.7p, a c31% premium to the current share price.”