Oil and Gas News

Buru faces delays due to border closures

Sasanof-1 exploration well

Buru Energy has reported that its Rafael 1 well test program was hit hard by the Western Australian Government’s recent decision to extend the state’s border closure and restrictions from 5 February.

The equipment required for the planned flow test at the Rafael 1 well was mobilised and ready to go prior to Christmas.

However, the specialised operators required to conduct this test have been denied entry to Western Australian from their Queensland and South Australian bases.

Buru Energy is currently working with SGS and the Western Australian Government to acquire the appropriate approvals needed for their contractors to travel into the state.

Contractors are expected to be able to to travel into Western Australia from 5 February, providing they quarantine for 14 days upon arrival.

This means that the Rafael 1 well test will likely commence in the third week of February.

Buru executive chairman Eric Streitberg commented on these delays, stating “the continuation of the WA hard border closures are unfortunate and also have a knock on effect to other operators who want to use the SGS testing Package.”

In addition, since Buru Energy’s latest report, the drilling of the 12 ¼-inch (311mm) hole has commenced, reaching a total measure depth of 2605 meters within the Ungani Dolomite, at an angle of 76 degrees.

As the drill string was being retrieved, it became stuck in the upper part of the Laurel Shale. Despite extensive efforts the drill string was not able to be recovered and has now been backed off at a depth of 2206 meters.

After an analysis of potential options for moving forward, it has been agreed that Roc Oil will undertake a side-track to complete the well as a sole risk operation, while Buru Energy continues as operator of the well under the Ugani joint venture agreement.

Both Buru Energy and Roc Oil (Canning) each hold a 50 per cent equity interest in the well and L20 Drilling License.

Both parties have agreed to amended terms to this sole risk operation, which gives Buru Energy the right to participate in the well at its original 50 per cent interest within six months of commencement of production (called the back-in right.)

Should Buru Energy exercise the back-in right, it will be required to pay Roc Oil an uplift of 2.5 times the amount of Buru’s share of the costs that Roc has paid for the sole risk operation.

The delays in drilling for the Ugani 8H program is expected to take up to 28 days.

Streitburg said the difficulties the company has been having with the Ugani 8H well is very disappointing.

“The sole risk operation going forward is an appropriate sharing of the risk and costs that will hopefully provide a satisfactory outcome for both parties,” he said.