Bounty Oil & Gas (ASX:BUY) riding high on solid progress and plan report

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Bounty Oil & Gas (ASX:BUY) riding high on solid progress and plan report

Bounty Oil & Gas (ASX:BUY)
Image source: © Bulus | Megapixl.com

Highlights

  • Bounty’s focus in 2022 will be on preparing for drilling at Cerberus, WA. to test several major oil targets while continuing its onshore oil programmes.
  • The Company expects the revenue to increase materially in FY22 thanks to stronger US dollar and higher commodity prices and anticipated drilling in Naccowlah Block.
  • Compliance systems have been prepared for each of the Downlands and Alton oil and gas fields and submitted to the Queensland regulator.
  • Field trips will be conducted to evaluate alternatives for re-exploiting the Rough Range Oil Field and avenues for lifting oil.

Independent Australian oil and gas explorer and producer Bounty Oil & Gas NL (ASX:BUY) shared a market update in relation to its various operations across its Australian assets on Wednesday. In 2022, the Company will focus on preparing for drilling at Cerberus, Western Australia (WA), to test several major oil targets while continuing its onshore oil programmes.

Let us look at the Company’s key recent developments.

Key activities undertaken since farm-in agreement

In mid-October 2021, BUY inked a binding farm-in agreement with Coastal Oil and Gas Pty Ltd for the acquisition of a 25% interest in Carnarvon Basin oil exploration licenses by financing AU$6 million for the costs of drilling three exploration wells.  

The farm-in agreement allows BUY, in the next six months, to earn two 25% tranches for additional participating interests by providing AU$9 million and AU$12 million, respectively, for the drilling program.

Location of Cerberus prospects

Source: BUY Announcement 19/01/22

BUY has identified main areas of interest for drilling and, along with Coastal, is aiming to commence the Drilling Programme in late 2022, subject to regulatory approvals. Subsequent to the implementation of the farm-in agreement, BUY and Coastal have undertaken numerous activities, including the following:

Key works accomplished

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Both jackup rigs, Noble Tom Prosser and Valaris 107, will be active on the North-West shelf in 2022, and there are drilling slots available in late 2022. Further, BUY and Coastal are progressing discussions with both rig contractors.  

Anticipated revenue growth through drilling at Naccowlah Block

BUY finalised the 2020/2021 Australian oil drilling campaign with 7 successful oil wells and 5 of the new wells are now online. Furthermore, the budget for the Cooroo Northwest Development well in PL36 in Southwest Queensland has been approved by BUY.

Proposed Cooroo Northwest Development well (left) and Cooroo Fields location (right)

Source: BUY Announcement 19/01/22

BUY reported that the full-year revenue from oil sales for the year ended 30 June 2021 stood at AU$1.47 million. With the strengthening of the US dollar, increased commodity prices and expected drilling in Naccowlah Block, BUY anticipates the revenue to grow significantly in FY2022.

RELATED ARTICLE: Bounty Oil & Gas NL (ASX:BUY) makes most of the crude oil boom  

Key developments at Surat Basin, Onshore Carnarvon Basin and PEP 11

Compliance systems for each of the Downlands and Alton oil and gas fields are prepared and submitted to the Queensland regulator for approval so that Bounty can make the best of high oil prices.

Considering BUY’s farm-in to Cerberus, a review of the Rough Range Field and the nearby prospects has been continuing. BUY looks to execute field trips to explore alternatives for re-exploiting the Rough Range Oil Field and opportunities for lifting oil to domestic as well as global markets.

Another key development for BUY comes on the Petroleum Exploration Permit front (PEP 11), wherein the Company’s extension of PEP11 for gas exploration in the offshore Sydney Basin was rejected by the Federal Government in mid-December. The JV is working towards making final submissions to NOPTA on this decision of the Federal Government.

In the current year, the Company looks to continue focusing on preparing for drilling at Cerberus, wherein multiple significant oil targets will be tested while progressing its onshore oil programs.

BUY shares traded at AU$0.009 a share on 21 January 2022.

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