Bow Energy Continues to Strengthen its Position in Renowned Producing Oil and CSG Basins via its Appointment as the Successful Bidder on Three Very High Potential CSG Blocks
Bow Energy Ltd is an energy company that has a two pronged emphasis on oil and coal seam gas (CSG). It is strategically positioned in several of Australia's most prolific on shore producing basins and has a solid management and technical team that are committed to utilising this position to capitalise on the strength within these sectors to generate wealth for its shareholders.
Illustrating the Company’s progress towards this objective, the Queensland Department of Mines and Energy has advised that Bow is the preferred tenderer for three new CSG blocks in the most recent 2008 land release.
Mr. Ronald Prefontaine, Bow’s Managing Director informed the Australian Investor, “This is a significant development from Bow’s perspective as we believe the blocks have multiple TCF potential and our team has the experience and know-how to turn this potential into cash.”
The Company originally started off as a spin off of Arrow Energy in 2005. Bow’s current directors were all executive directors of Arrow Energy during its formative years and since then Arrow has evolved into one of the larger coal seam gas producers in Australia.
Bow’s directors have never taken any free incentive shares or options in the company and are paid at the lower end of the scale - they plan to make the bigger money by being Bow shareholders meaning their interests are directly aligned with the shareholders.
“Initially Bow was created as an oil exploration company, which later diversified into the CSG sector,” Mr. Prefontaine explained to the Australian Investor, “As a result we have an exploration strategy that focuses on both oil and CSG exploration and production.”
The conventional oil side of the business is managed by Mr. Paul Lipski, Bow’s Chief Executive Officer for Convention Petroleum. His main priority going forward is to build Bow’s conventional oil portfolio and to continue to increase its oil production and reserves.
“Significantly advancing our progress towards these goals, Bow was a partner with Santos on a new field oil discovery called Cuisinier-1, earlier this year,” Mr. Prefontaine told the Australian Investor, “The operator has indicated Cusinier-1 should flow between 200 to 300 barrels a day. We believe it is a big oil discovery and our interpretation of the current data set indicates the Cuisinier structure has a mapped areal closure in excess of 40 sq km meaning it has the potential to host a large number of additional production wells.”
Cuisinier-1 is located approximately 6km west of the Santos operated Cook Oil Field in southwest Queensland, near the South Australian border. It is the first well under a staged farmin agreement with Santos Ltd and Avery Resources Pty Ltd where Bow is fully carried on up to five additional oil exploration wells, plus new 3D seismic acquisition. Bow retains a 15% working interest in ATP 752P on completion of all farmin stages.
“There are several additional prospects on trend with this discovery in the same block,” Mr. Prefontaine informed the Australian Investor, “The priority in this area is to increase the production of this project via the latest discovery of Cuisinier-1 through successful appraisal during 2009.”
Bow’s second focus within its conventional oil division is the development of its Southwest Surat Oil Project, which has recently been partially farmed out to Mosaic Oil.
“Mosaic Oil is our preferred joint venture partner and operator, as the company is a proven Surat basin explorer and producer,” Mr. Prefontaine explained to the Australian Investor, “We plan to start drilling in 2009 within our Stratton Project area to search for oil pools in the 2 to 10 million barrel range. Bow retains 42% of the area after the farmin is completed.”
Bow also has the largest gross land holding in the central Eromanga Basin oil province which it is looking to diversify via farm-in arrangements.
Mr. Prefontaine told the Australian Investor, “In regards to our CSG portfolio, we have three main project areas: the Don Juan area; Canaway Ridge; and the Bowen Basin where we have three soon to be awarded blocks.”
At the Don Juan area, located north of Roma, the initial exploration and production testing have been carried out and the Company is in process of reserve certification, with the aim of certifying reserves later this year or early in 2009.
At the Canaway Ridge, Bow plans to drill two core holes in November to determine gas content and coal thickness which should indicate if the area has the potential to be a new CSG province.
The really big news is that Bow has been offered by the Queensland Department of Mines and Energy 100% of three new blocks located within one of Australia’s most prolific Coal Seam Gas (CSG) fairways in the Bowen Basin. The blocks have a total area of 2,200 square kilometres.
“We are very excited by the potential of these new CSG areas especially considering they are in the heart of one of Australia’s highest rated coal seam gas provinces near the port of Gladstone,” Mr. Prefontaine informed the Australian Investor, “Additionally, they are on trend with some of the country’s biggest CSG projects and neighbouring blocks are held by some of Australia’s biggest CSG players.”
Bow’s belief that the Company is in the right address is strengthened by previous drilling and production results which indicates the new areas have the potential to hold giant CSG fields. Another advantage is that they are located near existing and proposed gas pipeline and infrastructure including planned export LNG facilities in Gladstone.
The Company intends to commence exploration and production programs as soon as the blocks are granted, with the target of establishing significant gas reserves during 2009.
“With Bow’s potential huge uncommitted gas reserves and the location of these new areas adjacent to pipelines and near proposed export LNG facilities in Gladstone, we believe Bow will be in strong position to be a significant new participant in the evolving export LNG market,” Mr. Prefontaine noted.
According to Mr. Prefontaine, Bow has a number of key strengths that will aid its future growth and development, including its excellent management and technical team that have the required skill sets to find and commercialise energy reserves.
Additionally, the Company believes its diversified portfolio in both oil and CSG will provide them with the capacity to create a mid tier Australian listed company.
“We see Bow progressing in a similar fashion to Arrow Energy as we have a similar large and diversified land position and exploration strategy,” Mr. Prefontaine told the Australian Investor, “The key difference is that we also have an expanding oil portfolio.”
As the Company continues to grow, Mr. Prefontaine intends to pass the baton to his two competent CEOs to manage the day to day operations of company and advance Bow’s projects to the next levels.
“I believe it is important to know your limitations,” he explained to the Australian Investor, “My strengths lie in identifying and acquiring the right areas to be in, not managing a production company. As a major shareholder with almost 5% of the Company I intend to stay on as a Director to continue to aid its development in any way I can.”
Mr. Prefontaine concluded, “We are very optimistic about the future growth of Bow and intend to maintain our current momentum by leveraging off our strategic positions in proven producing areas to maximise the value and wealth for our shareholders.”
September 2008
Ron Prefontaine
Managing Director
Here it is. Bow Energy Ltd
BOW Price at posting:
30.2¢ Sentiment: Buy Disclosure: Held
