The company and joint venture partner Mineral Resources have been awarded block L20-1 which complements Buru’s existing assets and is strategically located close to existing gas and port infrastructure.
Buru Energy Limited () (OTCMKTS:BRNGF) (FRA:BUD) is higher after accepting an offer for the award of bid block L20-1 in the onshore Carnarvon Basin, an area with highly prospective with geology and play types complimentary to its existing assets in the area.
In October 2020, Buru Energy and() (OTCMKTS:MALRF) (FRA:F5J) applied for bid block L20-1 as part of a regular Government onshore gazettal bid round.
The award will be a 50/50 Joint Venture between Buru Energy and MRL - with Buru Energy as operator.
There has been a strong response from investors with BRU shares up as much as 19.5% to 18.5 cents this morning, a new high of more than 12 months.
“Complements Canning Basin areas”
Block L20-1 contains a relatively unexplored sedimentary sequence similar to the petroleum bearing Devonian and Carboniferous aged sequences in the company’s permits in the Canning Basin.
Buru Energy executive chairman Eric Streitberg said: “We are delighted that we have been able to apply our hard-earned Canning Basin geological knowledge and operating experience to a new area close to existing infrastructure.
“We are equally delighted to have been joined in the application by Mineral Resources which has an outstanding reputation for bringing projects to fruition on budget and on time.
“This new exploration area complements our Canning Basin areas where we are about to start an exciting drilling program and we look forward to working with the various stakeholders in this new area, and getting boots on the ground to find some oil and gas.”
L20-1 location map.
Strategically located
Notably, the permit is immediately adjacent to MRL’s proposed Ashburton Infrastructure Development including the Bungaroo and Kumina mining projects and is strategically located close to existing gas infrastructure including the Tubridgi gas storage facility, the Dampier-to-Bunbury Natural Gas Pipeline and the Wheatstone and Macedon gas processing plants.
Mineral Resources managing director Chris Ellison said: “Mineral Resources’ move into the onshore Northern Carnarvon Basin makes sense given the block’s proximity to our own mining projects as well as existing gas infrastructure.
“We look forward to working with Buru to achieving shared success.”
The companies consider this existing infrastructure is a major positive for commercialisation of any hydrocarbon discoveries.
Initial prospects identified
Previous exploration on the block has been sporadic, mainly aimed at the shallow sedimentary section, with the underlying Canning Basin equivalent section being either ignored or not recognised.
Initial mapping by the joint venture has identified a number of conventional oil and gas prospects that can be tested by relatively shallow wells on the basis of the sparse but good quality existing seismic data.
