Buru Energy Limited’s (ASX:BRU) (OTCMKTS:BRNGF) (FRA:BUD) Canning Basin exploration program is underway with the Ensign 963 drilling rig currently being mobilised to the Currajong 1 well site in Western Australia.
The Currajong 1 structure is expected to be at a similar depth to the Ungani Oilfield at some 2,400 metres and to have similar seismic characteristics at the reservoir level.
The oil quality is also expected to be similar to Ungani at some 37 deg API and generally sold at a premium to Brent.
Site preparations at Currajong were recently completed, and the well is expected to spud in mid-June and take some 21 days to drill.
Drilling at Rafael 1 will follow once the drilling at Currajong 1 is complete.
Seismic program targeted for late June
The company expects to begin a seismic program comprising 1,100 kilometres in late June as crew becomes available from current Perth Basin contract.
Buru executive chairman Eric Streitberg said: “The exploration program is proceeding as planned with the mobilisation of the Ensign drilling rig and we are very much looking forward to the drilling of the two exploration prospects.
“We are also very keen to see the results of the seismic program that is being acquired over some particularly interesting areas of our permits.”
Under the terms of Farm In agreements executed in December last year with Origin Energy Ltd (ASX:ORG) (OTCMKTS:OGFGY), Buru is being carried for $16 million of the costs of the two exploration wells and for $6 million of the costs of the planned seismic program.
Notably, the prospective resources of the two prospects are substantial and represent some of the largest onshore conventional oil prospects in Australia.
Both wells have a combined total of around 97 million barrels of conventional oil (mean prospective resources).
Both prospects are targeting vugular dolomite reservoirs similar to the two existing Devonian aged oil fields in the Canning Basin, Buru’s 100% owned Blina Oilfield and its 50% owned Ungani Oilfield.
Drilling planned at Rafael 1
The company recently completed the Rafael access road and well site clearing, with final wellsite works including installation of impermeable liners are set to commence shortly to ensure the well site is ready for rig acceptance at the completion of the Currajong 1 well.
The large size of the Rafael structure means that at the exploration stage 2D seismic data is sufficient to provide confidence on the drilling location.
However, under the terms of the Farm In agreement for the Rafael well, Origin will also fund the first $4 million of a 3D seismic survey if the well is successful.
The principal reservoir section is expected to be encountered below 3,000 metres with the total depth of the well up to 3,800 metres and modelling of geothermal gradients and source rock composition gives the company confidence that oil is likely to be the dominant hydrocarbon phase.
The Rafael well is expected to be spudded in late July or early August.
Future value adding activities
Streitberg said: “We are also not letting the anticipation of results and the hard work required to deliver the drilling and seismic program distract us from the work we are doing on future value adding on a number of fronts.
“These activities include monetising our high value gas resources and working on our hydrogen and helium projects.
“We are also working hard on a process to reduce our overall emissions and want to ensure we have a plan for the development of the oil resources we hope to find with the lowest emissions intensity possible.”