Buru Energy (ASX:BRU) Advances with Strategic Partnerships in the Rafael Gas Project

April 09, 2025 10:43 AM AEST | By Team Kalkine Media

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Buru Energy (ASX:BRU) Advances with Strategic Partnerships in the Rafael Gas Project — Image source: shutterstock

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Highlights

Buru Energy confirms significant gas resources at Rafael.

Partnership with CEFA to optimize infrastructure development.

Projected strong economic impact with operations starting in 2027.

Buru Energy (ASX:BRU) has recently shared an encouraging update on its Rafael Gas Project, underlining both progress and strategic developments. The project, recognized for its considerable potential, has achieved a new level of confidence with a 1C contingent resource estimate of 85 billion cubic feet (Bcf) of gas. This milestone comes after the successful interpretation of the latest 3D seismic surveys and the drilling of the Rafael 1 well, which notably succeeded despite only a 21% initial chance of discovery.

In a significant strategic move, Buru Energy has joined forces with Clean Energy Fuels Australia (CEFA). This partnership will see CEFA take on the responsibilities of financing, constructing, owning, and operating the necessary LNG and condensate infrastructure. This allows Buru Energy to dedicate its focus and resources more on well development and processing tariffs, optimizing its investment and operational efficiencies.

Looking ahead, Buru Energy has outlined its timeline and expectations for the Rafael Gas Project. The company is scheduled to make its Final Investment Decision by late 2025 or early 2026, with aspirations to commence production in the latter half of 2027. Once operational, the project is anticipated to generate an annual pre-tax operating cashflow of around A$70 million over a projected 20-year production lifespan.

From an economic standpoint, the Rafael Gas Project stands as a potentially transformative initiative for Buru Energy. With a gross unhedged net present value (NPV) estimated at A$400 million and an internal rate of return (IRR) of 44%, these figures not only underscore the project's viability but also position Buru to transition from being primarily an exploration entity to becoming a foundational gas business within the Kimberley region.

This strategic development marks a pivotal point for Buru Energy, promising significant economic benefits and enhanced shareholder value through meticulous project management and strategic partnerships. The journey of the Rafael Gas Project represents a forward-thinking approach to energy development, with a keen focus on sustainability and economic feasibility.

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