Buru Energy Ltd (ASX:BRU) continues to advance its operations and the Tight Gas Pilot Exploration Program (TGS) in the Canning Superbasin of Western Australia.
The joint venture has identified and commenced the appraisal of a unique, world scale, gas and liquids resource in the Laurel Formation, a thick and extensive sequence of tight sands, silts and limestones.
The evaluation of the data obtained from the Laurel Formation tight gas stimulation program has confirmed the prospectivity and commercial potential of the resource.
Eric Streitberg, executive chairman, commented: “We are very pleased with the results of the gas program to date.
"We have proven conclusively that we have a high quality gas resource with significant liquids content, and that we have the techniques to produce it safely and effectively.
"We know the overall resource is very large and we will now be focused on commercialising it.
"We are also very pleased that we have been able to produce these results with a small number of wells and prove that, as we have always believed, the Canning Basin has the potential to be a major source of gas and liquids for Western Australia."
Details on the joint venture
The joint venture holds the permits covering the most prospective parts of the Laurel Formation under a State Agreement Act with the Western Australian Government.
This agreement facilitates the systematic exploration and evaluation of the unconventional resources in the basin, and reflects the confidence that the resource has the potential to be a major contributor to the energy needs of the State of Western Australia.
There is a strong domestic demand for gas from the Canning Basin which would be supplied into the market through the Great Northern Pipeline from the project to Port Hedland.
There is also a local market for the first stage gas from the project including power generation and local industry.
Buru also recently received the results of an independent review that it commissioned of the Ungani Field by Gaffney Cline and Associates.
This review estimated the remaining gross recoverable contingent resources of oil for the field at the 1C level to be 2.08 million barrels, at the 2C level to be some 6.65 million barrels, and the 3C resources to be some 18.80 million barrels.
Buru’s equity share of these resources is 50%.
These are significant increases to Buru’s previous estimates at the 2C and particularly the 3C level, illustrating the potential upside of the field.
Streitberg added: "We are also extremely pleased with the results of the independent review of the Ungani Oilfield which has given us a substantial uplift in resources at the 2C and 3C level.
"Ungani is a valuable resource of high quality oil and we are working hard to get it back to generating cash flow at good margins as soon as practicable.
"We are also being very careful with our cash position and have taken all the steps we can to drive down costs and maintain our cash balance.
"We have a number of other initiatives underway that also have the potential to put us in a stronger financial position."
Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX emerging companies with distribution in Australia, UK, North America and Hong Kong / China.