Buru Energy (ASX:BRU) has made a major breakthrough during ongoing drilling at the Ungani Far West 1 well in the Canning Basin in Western Australia with the recovery at surface of an oil sample from a five-meter sandstone interval, well above its main target zone.
The company's drilling program has continued to unlock the potential of the Canning Basin with an oil recovery from a sandstone zone with the potential for good flows about 1,560 metres deep at the top of the region's Anderson Formation.
Interpretation of pressure data indicates a potential oil column of at least 14 meters of which some five meters is net pay at the well.
The discovery comes as Buru has drilled the 6-1/8” (156mm) hole to a depth of 2,316 metres in the interpreted shale formation overlying the main target of the Ungani Dolomite.
The well has a programmed maximum total depth of 2,600 metres.
By no means a wildcat target, this well is considered low-risk with high value-adding potential since the discovery of oil here could add significantly to currently estimated Ungani volumes close the existing production facilities at Ungani.
The well is located on an all-weather drilling pad approximately 1 kilometre off the Ungani access road within Production License L21, 97 kilometres east of Broome and 3.3 kilometres southwest of Buru’s Ungani oilfield.
Analysis
This oil discovery is a hugely encouraging outcome for the Ungani area, and importantly, this oil zone is a play opening discovery in an area which has numerous other leads and prospects at a shallow level which will now be evaluated for future drilling.
Potential price catalysts for Buru as this program unfolds include the deeper drilling to see what awaits in the Ungani Dolomite section, which is the main target of the well.
Importantly, Buru’s work to date at Far West 1 is highlighted by the fact that the company has already found oil, but the discovery wasn’t even in the project’s main target area.
This bodes extremely well for upcoming work at the site and the potential for further oil discoveries.
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