Buru Energy’s big-ticket oil exploration to kick off in Canning Basin
In a sector that has seen precious little recent domestic exploration, Buru Energy is progressing its plans to commence a major drilling program onshore in the Canning Basin next month.
The drilling program includes exploration wells on two large conventional oil prospects, Kurrajong-1 and Rafael-1, with the mean prospective resources of both wells totalling in excess of 95 million barrels of conventional oil.
Buru (ASX: BRU) is operating the two major exploration wells in joint venture with Origin Energy (ASX: ORG), with Origin carrying Buru for the first $16 million of the associated well costs.
Buru successfully completed a placement this month to raise $15 million before costs to help fund the program.
The Perth company has also given eligible shareholders the opportunity to participate in a Share Purchase Plan to apply for up to $30,000 in value of new fully paid ordinary shares in Buru without incurring any brokerage. The SPP, priced at 16c a share, is for a maximum amount of $5 million.
Kurrajong-1 is the first well to be drilled in the program and is located 30km west of Buru’s producing Ungani oil field. It has similar geology to Ungani and mean prospective resources of around 29 million barrels of recoverable oil.
Preparations for drilling are well underway with the support and under the supervision of senior Yawuru Traditional Owners.
Topsoil has been stripped and stacked ready for rehabilitation of the site, ground has been levelled and compacted, the cuttings sump formed up ready for installation of the impervious liner and the 20-inch surface conductor and cellar installed.
The drill rig being used for the program is the Ensign 963. Ensign 963 was previously located at Origin’s Kyalla-1 well site in the Beetaloo Basin in the Northern Territory.
Ensign and Buru have completed rig preparation inspections and Ensign is mobilising the rig to the Kurrajong-1 well site, with the first loads expected to be picked up on 24 May.
It is expected to take two weeks to mobilise all the equipment to the Kurrajong-1 site with rig up and rig inspection and acceptance expected to be completed to allow for a spud date of mid-June.
Kurrajong-1 will be followed by Rafael-1, which has mean prospective resources of approximately 69 million barrels of conventional oil.
Buru’s executive chairman Eric Streitberg said everything was progressing well and the company was due to formalise the rig contract imminently.
“Drilling preparations are well underway and on track for our target mid-June spud,” he said.
“Site preparations have gone smoothly and without incident and we are very much looking forward to the spud of Kurrajong in just over 4 weeks.
“We are drilling two of the largest onshore oil exploration targets in the country at a time of rising oil prices and critical domestic oil production declines.”
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