US-based Northcote Energy has reported a 40% increase in its net oil and gas reserves, following the acquisition of additional working interest and royalty interest in the Horizon Project in Osage County, Oklahoma.

Northcote’s working interest in the Horizon Project has increased to an average 37.5% and an average of 2.2% royalty interest.

The net attributable proved reserves of the company have increased from $33.8m to $47.6m and it now has net attributable reserves of 914 million barrels of oil and condensate, and 2,376 million cubic feet of gas.

The oil and gas company has an option to further increase its working interest in the project by acquiring 8.33% to an average of 45.83%.

Northcote Energy chief executive officer Randy Connally said the company could manage to increase the value of its net proved reserves within weeks of its admission to AIM in January 2013.

"As a result, we have substantially increased the asset backing of the Company, which remains considerably higher than our current market valuation," Connally added.

"There is another option in place to increase our interest in Horizon by a further 8.33% which, subject to being exercised, should also result in a significant increase in net reserves and underlying value.

"With the fracture stimulation programme due to commence shortly and the workover operations that are currently underway on four producing wells at Horizon, where we have already seen a small increase in net production at one of these, we are highly confident that we will deliver a substantial increase on our production by the end of 2013."