Bounty Oil and Gas (ASX: BUY) targets higher oil production after active March quarter

Highlights

• Revenue for the quarter ended 31 March 2024 was AU$399k.
• The Watkins North 1 and 2 wells came online, increasing quarter-on-quarter production by 75%.
• Cash and current assets balance was AU$1.8 million with zero debt at the quarter end.
• Bounty acquired full ownership of additional proven oil reserves adjacent to Alton within the Surat Basin.
• Oil revenue is anticipated to range between AU$2.0-2.5 million in 2024, with total production expected to exceed AU$3 million in 2025.

Bounty Oil and Gas NL (ASX: BUY) advanced oil production activities from the Naccowlah Block in SW Queensland during the quarter ended 31 March 2024.

The company achieved a significant milestone as the Watkins North 1 and 2 wells came online. This development increased quarter-on-quarter production by 75%. Total production stood at 2,917bbls (barrels of oil) and total sales reached 2,849bbls, delivering revenue of AU$399k.   

Oil business revenue for the nine months to 31 March 2024 was AU$1,236,000. As of 31 March 2024, cash and current assets reached AU$1.8 million with zero debt. 

Significant developments across the Naccowlah and Surat Basin

During the reported period, net production from the Naccowlah Block and associated PLs averaged 32 bopd net to Bounty. In this block, further development and NFE (near field exploration) targets have been located, and future drilling campaigns will focus on these targets.

The focus in on enhancing oil production from the recently connected Watkins North discoveries. Additionally, BUY intends to undertake production and production optimisation programs in the Block.

Moreover, during the period, Bounty acquired full ownership of additional proven oil reserves adjacent to Alton within the Surat Basin. The company continues its field operations, aimed at reactivating Surat Basin fields for production in 2024.

At the Southern Surat Basin, the company seeks to enhance the tempo towards oil production with compliance work and system upgrades.

Higher revenue expected

Backed by anticipated higher oil prices of AU$135 per barrel, Bounty has initiated field operations to reactivate two wells at Alton, beginning with the Alton 3 well. Concurrently, the company is designing a comprehensive field development strategy with the objective to commercialise a 2C contingent resource of 200k barrels from the Evergreen Formation.

Subsequent phases of development will involve drilling an up-dip appraisal well at Eluanbrook and exploring up to three attic oil locations within the Alton and Fairymount Pools. The company expects to deliver preliminary production of 100 barrels of oil per day from the Fairymount and Alton fields, resulting in an additional gross revenue of AU$2.5 million every year by 2025.          

In 2024, oil revenue is anticipated to fall in the range of AU$2.0 – 2.5 million and in 2025, total production is anticipated to reach above AU$3 million, with further additions.

BUY shares last traded at AU$0.005 apiece on 17 May 2024.