Brookside Energy's 2025 Strategy: Focus on Inventory Growth and Targeted Drilling
BRK (BRK) Share Update December 2024 Tuesday 17th
Brookside Energy Announces Strategic Focus on Inventory Growth and Drilling for 2025
Brookside Energy Limited (ASX: BRK) has unveiled its strategic plans for 2025, emphasizing inventory growth and targeted drilling in the Anadarko Basin, aiming to enhance shareholder value amidst fluctuating oil prices.
Instant Summary:
- Focus on expanding inventory of high-quality drilling locations in the Anadarko Basin.
- Planned drilling of three new 10,000-foot lateral horizontal wells in 2025.
- Expected net production growth of 30% to 40% over 2024 levels.
- Projected 2025 CAPEX of US$18.3 million, funded through cash flow and working capital.
- Potential for opportunistic share buybacks with higher energy prices.
Strategic Focus for 2025
Brookside Energy Limited is set to enhance its operations in 2025 by focusing on inventory growth and targeted drilling. The company plans to expand its inventory of undeveloped drilling locations in the SWISH Play and the broader Anadarko Basin. This initiative aims to replace proved developed reserves and extend the drilling inventory beyond the current four-year plan.
Brookside's team is leveraging its expertise and extensive geological data to identify new opportunities in underdeveloped areas. The expansion includes adding a fifth Drilling Spacing Unit (DSU) within the SWISH Play area, which is crucial for sustainable growth and shareholder value.
Targeted Drilling Program
Building on its successful SWISH Play drilling program, Brookside plans to drill three new 10,000-foot lateral horizontal wells in 2025. The first well is scheduled to spud in the first quarter, with necessary pre-spud work already underway. The remaining two wells, planned for the third quarter, will target a new DSU, with further details to be shared post-regulatory approval.
2025 Outlook and Financials
Brookside expects net production in 2025 to double compared to pre-FMDP levels, with a 30% to 40% increase over 2024's annual average. The projected net capital expenditure for 2025 is US$18.3 million, covering drilling, completion, and land costs. A portion of the budget is also allocated to prospecting and acreage acquisition activities.
EBITDA for 2025 is projected at US$18.0 million, based on a WTI crude oil price of US$75.00 per barrel. This aligns with previous forecasts, considering revisions to the drilling program.
The strategic focus on inventory growth and targeted drilling positions Brookside Energy to capitalize on opportunities within the Anadarko Basin. The anticipated production growth and financial projections suggest a positive outlook for the company, despite potential oil price volatility. This strategy may bolster investor confidence and support stock stability.
Investor Reaction:
Analysts may view Brookside's strategic focus as a prudent approach to managing market volatility. The emphasis on inventory growth and targeted drilling aligns with industry trends, potentially attracting positive attention from investors seeking stable returns in the energy sector.
Conclusion:
Brookside Energy's 2025 strategy highlights its commitment to disciplined growth and value creation. Investors should monitor the company's progress and consider the potential long-term benefits of its strategic initiatives. Staying informed on Brookside's developments will be crucial for making informed investment decisions.