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Buru Energy sells a further ~68,000 barrels (gross) of Ungani oil under its marketing agreement with BP Singapore

The company’s 50% revenue share from the lifting is currently estimated at around A$1.8 million, with the price to be finalised at the end of December.

Buru Energy Ltd - Buru Energy sells a further ~68,000 barrels (gross) of Ungani oil under its marketing agreement with BP Singapore
The next lifting is expected to be in February 2021 - subject to any impacts on production from wet season rainfall

Buru Energy Limited (ASX:BRU) completed the latest lifting of Ungani crude oil from Wyndham Port on November 30 2020, with the MT NS Power lifting a total of 67,757 barrels gross with Buru’s share being 50%.

As per the marketing agreement with BP Singapore Pte Limited, BP have purchased the crude FOB Wyndham and will deliver the crude to a refinery in SE Asia.

Current field production is around 1,000 barrels of oil per day and the next lifting is expected to be in February 2021 -  subject to any impacts on production from wet season rainfall.

BP marketing agreement

Under the marketing contract, the price received will be the actual price BP have sold the crude to the refinery (being a fixed differential to the average dated Brent price for the month of December), less shipping and associated costs.

Under these terms Buru’s 50% revenue share from the lifting is currently estimated at around A$1.8 million, with the price to be finalised at the end of December.

Exploration and farm-out plans

Planning for the 2021 exploration program is continuing, with bids received from rig and seismic contractors currently being evaluated and heritage surveys for the planned seismic programs underway.

The timing and extent of the seismic and drilling programs will be finalised once rig and seismic crew availability has been confirmed, and the current farm-out process is concluded.

The company believes that farm-out discussions are proceeding well and anticipates they will be concluded prior to the end of the year.

Financial outlook

Buru is now debt free, having recently repaid the final $2 million instalment of its long-term loan from Alcoa Australia originally of some $40 million.

The financing arrangement with Alcoa was put in place by the company’s predecessor, ARC Energy, in 2007 to assist funding gas exploration activities in the Canning Basin as part of a longstanding, co-operative and aligned gas supply relationship with Alcoa.

The company is currently forecasting a cash and cash equivalents balance as at December 31 2020 of around $20 million.

Quick facts: Buru Energy Ltd

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