Buru Energy Limited (ASX:BRU) has now completed wireline logging on the Ungani Far West 1, which highlights that the Ungani Dolomite reservoir system is oil bearing.
This follows the company confirming the discovery at the end of last month at the Ungani Far West 1 well, which is located one kilometre off the Ungani access road in Western Australia’s Canning Basin.
Today Buru said that the quality of the wireline logs is excellent, and the uppermost 15 metres of the reservoir zone is interpreted from logs to be oil saturated and has significant vugular development and oil bleeding from cores.
The wireline log interpretation also suggests that the potential oil column extends a further 26 metres to a total of approximately 41 metres.
There is further potential pay in a lower zone that also has significant vugular and fracture development.
Eric Streitberg, executive chairman, commented:
“We are delighted with what we have seen from the well to date. There are obvious zones of well-developed vugular porosity and high gravity oil is coming into the well bore during routine operations.
"It took a production test to establish just how big Ungani was when it was discovered and the same applies to Ungani Far West.
"The important thing about this well is that it confirms that the Ungani Dolomite reservoir system is extensive and that the petroleum system is working well – we are particularly pleased with the quality of the oil we have seen from this well to date and also from the recent test at Ungani North.
"Ungani crude is highly valued in SE Asian markets and this oil is also likely to sell at a premium."
Ungani Far West 1
The Ungani Far West 1 appraisal well was spudded in November 2015, and is located on an all-weather drilling pad one kilometre off the Ungani access road within Production License L 21.
This is around 100 kilometres east of Broome and around 3 kilometres southwest of the Ungani Oilfield.
Buru has a 50% equity interest in the well and a contributing interest of nil as the well is being drilled under the terms of the Ungani Development Funding agreement with Diamond Resources (Fitzroy) Pty Ltd.
Additional details
During the course of the logging program further oil influx occurred with four barrels of 41 degree API oil being recovered at surface.
The current operation is running a completion string which will be configured to determine the height of the oil column and the productivity of the well. Results of the tests will become available over the next two weeks.
Analysis
Today's news further boosts the regional prospectivity of the Ungani Dolomite.
Early indications outline that this well is similar to the company’s flagship Ungani wells, which are strong oil producing wells with good quality oil from the similar Ungani Dolomite reservoir.
The next key catalyst for Buru will be the test results over the next couple of weeks.
In the dry season Buru will be able to hook the field up to Ungani, which will then form part of the production system.
Proactive Investors is a global leader reporting financial news, media, research and hosts events for listed emerging growth companies and investors across four continents.