Buccaneer Energy Plc (AIM:BUCE) this week detailed its development strategy following the acquisition of new acreage adjacent to its Allar #1 well in East Texas.
The company said the lease acquisition enables it to sidetrack the Allar #1 well westward, which was previously restricted by lease boundary rules. It also includes the Turner and Daniel wells, which it said will support its longer-term waterflooding plans.
The sidetrack drilling at Allar #1 is expected to cost between $125,000 and $150,000 gross, with Buccaneer’s net share estimated at around $50,000. The company plans to undertake the sidetrack simultaneously with the drilling of Fouke #4 to reduce mobilisation costs.
CEO Paul Welch joined the Proactive studio to discuss the plans, and here, we take a closer look at what was said.
Proactive: Paul, very good to speak with you. Why is the addition of this acreage an important step for Buccaneer?
Paul Welch: It's an important step for us because it gives us optionality. As we discussed last time, at Allar #1 we drilled a well close to the bounding fault to the east, and the sand thinned as we approached the fault. We planned to sidetrack to the west, but couldn’t at the time due to Texas Railroad Commission rules requiring a 330-foot offset from the lease line. We had drilled right at that point. To go west, we needed permission from the adjacent leaseholder. We’ve now acquired that lease, giving us the permission ourselves.
The lease also includes two deep wells – the Turner Well and the Daniel Well – which will be useful when we begin waterflooding. This acquisition gives us flexibility to decide whether to start waterflooding now or drill more infill wells. It’s a strategic pickup.
Proactive: What is the timeline and expected cost range for a potential sidetrack of Allar #1 now that you’ve secured the new acreage?
Paul Welch: Allar #1's location and roads are already built. To drill the sidetrack, we’d need to add about 600 feet of wellbore, moving 150 feet west. Estimated gross cost is $125,000 to $150,000, and Buccaneer’s net share is about $50,000. If we do it concurrently with drilling at Fouke #4, we can avoid extra mobilisation costs.
Proactive: And how quickly could the Turner #1 Well be brought back into production? What impact might that have on near-term output?
Paul Welch: Turner #1 could be brought back within a month. It’s slightly down-dip from Fouke #1 and drilled into part of a tarmat, so the oil is thicker and denser. The well was shut in because an operator overheated the crude with a heater treater, causing the stock tanks to explode.
To restart, we could either install new tanks or tie the well back to the existing Fouke #1 location. Output could be 10 to 30 barrels a day, but we’ll need to do some minor work – pulling the rods and pump – and then decide on the tank solution. We literally just picked up the lease, so these plans are still being finalised.
Proactive: Can you explain how the discussions with the Texas Railroad Commission on an Enhanced Recovery Unit could change the long-term production profile at Pine Mills?
Paul Welch: In this area, you inject water to raise reservoir pressure and push oil toward producers – that’s a waterflood. To do this, you need to form a unit, where all leaseholders agree on their shares. That’s a standard process and should take a couple of months.
We began discussions with the Railroad Commission about six months ago, but paused while securing the lease. Now that we own it, we can proceed. There are only two to three leases involved, so it should be manageable. The infrastructure is already there from our existing Pine Mills waterflood, which has operated for seven years. So it’s a logical extension.
Proactive: With Fouke #4 still on track to start in December, how do you see the combined impact of Allar #1, Turner #1 and Fouke #4 shaping Buccaneer’s growth going into 2026?
Paul Welch: If the upside scenarios play out, Allar #1 and Fouke #4 each produce 124 barrels per day, and Turner #1 could add up to 30. That’s 280 barrels per day gross – about 90 barrels net to Buccaneer.
In a low oil price environment, the waterflood could double recovery rates from 15–20% to around 50%. We already have the facilities for water injection and disposal. So we’ll discuss with our partner how to proceed. For now, we plan to drill Fouke #4, sidetrack Allar #1, and bring Turner #1 back online.
We're currently producing around 100 barrels per day from two wells in Fouke. If we can implement the waterflood, we could double that – a cost-effective production increase. That’s why the acreage acquisition was important – it gives us options and flexibility moving forward.
Proactive: Paul, I hope you continue to keep us updated with your progress.