Buru Energy Limited (ASX:BRU) has this week completed a lifting of 76,817 bbls of crude from the Ungani joint venture with Roc Oil onshore Western Australia.
The crude was lifted by Petro-Diamond Singapore Pte Ltd (PDS) from CGL storage Tank 10 at Wyndham Port.
Buru’s share amounts to 50% with the price received FOB Wyndham being the realised average dated Brent oil price for the loading month, less the buyer’s fixed marine transport discount under the existing contract with PDS.
The 50% revenue share from the lifting was provisionally invoiced at approximately A$1.2 million subject to adjustment related to the average dated Brent price for May with the Brent price currently strengthening.
This was the final lifting under the existing PDS contract which expires on June 30, 2020.
Negotiating new contract
The Buru/Roc Oil JV is in discussions with PDS and other global crude traders to negotiate an offtake contract beyond June 30.
Any potential contract may be affected by the current physical oil market and shipping constraints.
Current field production by the JV at Ungani continues to be steady with all wells on production at around 1,500 barrels of oil a day.
Buru and Roc are carefully evaluating all options, including the potential decision as to whether a temporary suspension of production from Ungani would be prudent.
The JV is in the fortunate position of being able to suspend production with no material operational consequences, and at relatively low cost, as it has done on occasions in the past.
Buru is also advancing the farm-out process for its Western Australian exploration areas.