Buru Energy Limited (ASX:BRU) and joint venture partner Roc Oil have entered a longer-term marketing agreement with BP Singapore Pte Limited through to June 30 2021.
BP will market the Ungani crude by offtaking the crude from Wyndham Port on an FOB (free on board) basis and on-selling the oil into the appropriate market.
The first oil lifting under the new BP marketing agreement is expected to be in late September 2020.
Ungani Oilfield production and operations
The Ungani Oilfield is subject to a process of continuous improvement both for the surface production facilities and the downhole well configurations.
This has the aim of continuous process improvement, maintenance of production and optimisation of oil recovery.
Recent activity has included upgrades to instrumentation and controls and the installation of an electric submersible pump (ESP) in the Ungani 7 well.
The operation has now been completed and the pump is producing in line with design parameters.
Notably, the other wells in the field are producing at stable rates within their predicted decline envelopes for a combined total field oil rate of an average 1,250 bopd (barrels of oil per day).
“Exciting prospects to target”
Buru executive chairman Eric Streitberg said: “We are now in good shape after being hit by a double blow from the onset of the COVID-19 pandemic, followed by the collapse in global oil prices.
“We have worked hard to ensure we have a healthy balance sheet and a range of exciting prospects to target next year.
“We have a leaner, fitter organisation with sharpened and internalised operational capability.
“There are still some pieces of the puzzle to put in place, but we are close to finalising these.
“We have also made a synergistic exploration move with our core geological and geophysical capabilities being brought to bear on mineral exploration targets that are complementary to our oil and gas targets.”
Further development of Ungani
The Ungani Joint Venture is undertaking technical and commercial analysis of the feasibility of further development well drilling on the Ungani Oilfield during the 2021 drilling season.
Factors being considered include rig availability and suitability, bottom hole location for the well, well design and associated long lead items, and the commercial drivers for additional wells at this stage of the field’s development.
It is anticipated a decision will be made on the program by the end of the year to allow adequate planning and approval time for a 2021 drilling program, if this is agreed by the joint venture.