Buru Energy Secures Drilling Rig for 2024 Canning Basin Campaign
BRU (BRU) Share Update August 2024 Monday 5th
Buru Energy Executes Letter of Intent for Canning Basin Drilling Campaign
Buru Energy Limited (ASX: BRU) has announced the execution of a Letter of Intent with Silver City Drilling Pty Ltd for the provision of Rig 24, marking a significant step forward in its 2024 Canning Basin drilling campaign.
Instant Summary:
- Buru Energy signs a Letter of Intent with Silver City Drilling for Rig 24.
- The campaign includes drilling two wells: Rafael Shallow and Mars.
- Binding Rig Hire Agreement expected soon.
- Recent Farm-in Agreements with Sabre Energy for Rafael Shallow and Mars prospects.
- Drilling operations to commence late Q3 or early Q4 2024, pending regulatory approvals.
Letter of Intent Details
Buru Energy Limited has executed a Letter of Intent with Silver City Drilling Pty Ltd for Rig 24, which will be used for a two-well drilling campaign in the Canning Basin, Western Australia. This campaign includes the Rafael Shallow and Mars exploration wells, scheduled to begin in late Q3 or early Q4 2024, subject to final regulatory approvals.
CEO Thomas Nador expressed optimism about the milestone, stating that the execution of the Letter of Intent demonstrates progress in Buru's plans to resume drilling activities and create value for shareholders. The exploration success at Rafael Shallow or Mars could expedite the development of oil, generating substantial revenue for Buru, the traditional owners, the WA Government, and the local Kimberley community.
Strategic Importance
A new oil discovery would provide additional funding for Buru's 100% owned Rafael Deep Phase 1 gas and condensate project, which remains a development priority. Viv Oldfield, Director of Silver City Drilling, expressed enthusiasm for the collaboration, highlighting the potential for renewed interest in exploratory drilling and long-term support for Buru and its joint venture partner Sabre Energy.
Next Steps
Buru expects to finalize a binding Rig Hire Agreement with Silver City Drilling in the near term. This follows recent Farm-in Agreements with Sabre Energy for the drilling of the high-potential Rafael Shallow oil prospect in EP 428 and the restart of production from the Ungani Oilfield, including the Mars oil prospect in L 20.
Drilling planning is on track, and operations are set to commence in late Q3 or early Q4 2024, pending final regulatory approvals.
The execution of the Letter of Intent with Silver City Drilling is a positive development for Buru Energy, signaling progress in its exploration activities. The potential for new oil discoveries could boost the company's revenue and provide funding for its gas and condensate project. This announcement is likely to positively impact Buru's stock price as investors anticipate successful drilling outcomes.
Investor Reaction:
Analysts are likely to view this announcement favorably, given the strategic importance of the drilling campaign and the potential for significant revenue generation. Investor sentiment is expected to be positive, with increased interest in Buru's stock as the drilling campaign progresses.
Conclusion:
Investors should keep an eye on Buru Energy's progress in finalizing the Rig Hire Agreement and the commencement of drilling operations. The potential for new oil discoveries and the subsequent impact on the company's revenue and funding capabilities make this an exciting development for Buru and its shareholders.