Buccaneer Energy Plc (AIM:BUCE, FRA:LMU1) told investors it has completed the acquisition of a 100% working interest in the Carlisle-1 well in East Texas, a deal that immediately adds production, cash flow and a bigger strategic stake in the proposed Fouke waterflood unit.
The AIM-listed group said Carlisle-1 is currently producing around 25 barrels of oil per day, taking total working-interest production to about 155 bopd. The well carries operating costs of roughly US$6.23 a barrel and, at current field prices of about US$92/bbl, is generating a netback of around US$65/bbl, or approximately US$50,000 a month in net cash flow.
"Carlisle-1 is a high-margin producing asset with low operating costs and attractive reserves and increases our interest in the proposed Fouke waterflood unit to greater than 50%, enhancing our operational position as we continue to develop the area," said chief executive Paul Welch.
"[The well] offers attractive capital efficiency, with a projected payout period of approximately 9 months at current pricing."
A third-party report prepared by APN Energy estimated proved developed producing reserves of about 51,000 barrels for the asset and assigned it a PV10 value of US$910,540 using the WAFD bank price deck. Buccaneer noted that these figures do not include an expected 225,000 barrels tied to waterflood development or its Organic Oil Recovery programme.
The company added that the acquisition, which was partly funded from its recently announced £350,000 fundraise, lifts its interest in the proposed Fouke waterflood unit to more than 50% from roughly one-third.
Welch added: "The Board believes Buccaneer's current market capitalisation of approximately £1.55 million does not yet reflect the value of its existing producing reserve base, as set out in the latest reserve update using the conservative WAFD bank price forecast, and before any contribution from recent oil price increases, the proposed Fouke waterflood unit, OOR optimisation or broader field development upside.
"Our focus is on disciplined execution to narrow that value gap through production growth, cash generation, and enhanced recovery initiatives."