- Bounty would fast-track the development of additional oil and gas assets in 2022.
- Bounty targets to ramp up production from its existing capacity and develop its Surat Basin assets.
- Amid strong oil prices, Bounty has achieved oil prices above AU$150 per barrel.
Energy player Bounty Oil & Gas NL (ASX:BUY) shared an upbeat market update announcing the fast-tracking of additional oil and gas developments in 2022. The decision has been taken after considering changing macroeconomic dynamics that included increased oil prices, a strong US dollar relative to the Australian dollar, and the presence of available refining capacity at its Surat Basin oil development assets.
The management at Bounty has observed that macro-economic conditions have tightened the oil and gas markets along with the challenge of the energy transition to greener fuels. Oil and its refined products are the lifeline of any economic activity and also support food production.
Bounty targets to ramp up production from its existing production and also develop its Surat Basin assets as Australia’s reliance on imported fuel faces severe energy scarcity issues. The rally in crude oil prices has been boosting the balance sheet of Bounty with strong material revenues from the Naccowlah Block production asset:
- A monthly revenue rate of $240,000 a month
- Achieving oil prices above AU$150 per barrel
- Bolstering balance sheet will facilitate the commencement of 100% Bounty-operated Surat Basin oil production in 2022. As many as 3 appraisal drills will be used to exploit proven reserves
- Bounty anticipates oil prices to remain high in the future and anticipates the acceleration of the growth strategy
How can Surat Basin assets help Australia?
In an effort to attain energy security, Australia requires leadership from the energy industry. Bounty believes that it is ideally positioned to emerge as a major player in addressing Australia’s energy security challenges through its portfolio of oil and gas appraisal and development opportunities.
Notably, only a few ASX-listed juniors plan to increase their domestic oil and gas production, which may restrict growth activities for other players. Bounty plans to take up the following opportunities –
- Delivery of gas to the domestic market from its Surat Basin Downlands Gas Field. The facilities would review that there is an available market for gas delivery into the Silver SpringsWallumbilla Pipeline at historically high east coast gas prices
- Production from the Alton Oil Field and the Eluanbrook oil/condensate resource
- Appraisal and subsequent development of the down-dip oil accumulation at Downlands
- Appraisal and development of adjacent oil and gas assets, which would complement Bounty’s assets.
With a change in market conditions, sentiment towards investment has also changed in terms of alternative financing and development farm-in partners. Bounty is currently pursuing these avenues.
As market conditions have changed, so has sentiment towards investment both in terms of alternative financing and development farm-in partners.