Buru Energy Ltd: Advancing to Producer Status with Rafael Gas Project

Highlights:

• Buru Energy Ltd is progressing toward becoming a producer with its Rafael Gas Project in Western Australia.

• A strategic partnership with Clean Energy Fuels Australia (CEFA) is key to advancing the project.

• The project aims to deliver long-term regional energy supply while significantly enhancing cash flow.

Buru Energy Ltd (ASX:BRU) is making steady progress toward its transformation from an exploration company to a gas producer. The company's flagship Rafael Gas Project, located in the Kimberley region of Western Australia, is on track for development, with a clear path to delivering first gas and cash flow by the second half of 2027.

Rafael Gas Project Overview

The Rafael Gas Project, located in the Canning Basin, is the only proven conventional gas and condensate discovery in the Kimberley region. The project boasts a high-confidence contingent resource that supports its economic feasibility. The gas and condensate discovery is backed by solid data, positioning Buru to become a significant energy provider for the region.

Buru Energy’s goal is to begin production in the second half of 2027, which would provide long-term, stable energy supply and cash flow. The project has been structured to support the region's energy needs, with a focus on supplying gas to local industries and remote communities currently reliant on diesel.

Strategic Partnership with CEFA

A crucial element in advancing the Rafael Gas Project is Buru Energy's strategic partnership with Clean Energy Fuels Australia (CEFA). This collaboration, announced in April 2025, plays a pivotal role in funding and infrastructure development. CEFA will finance, build, and operate the liquefied natural gas (LNG) and condensate infrastructure, significantly reducing Buru’s capital exposure.

This partnership also includes joint marketing and a pricing mechanism for gas and condensate, ensuring both companies benefit from the project’s success. By limiting Buru's exposure to upstream well costs and focusing on a processing tariff model, the partnership enhances the financial viability of the project.

2025 Milestones and Key Activities

Buru Energy has outlined a series of critical activities for 2025 that will drive the Rafael Gas Project toward its final investment decision (FID). These activities are necessary for progressing through the project’s development stages and include essential steps such as flow testing, the recompletion of the Rafael 1 well, and obtaining environmental and development approvals.

Other key activities for 2025 include securing agreements with Traditional Owners, achieving reserves certification, and finalizing gas and liquids marketing strategies. These efforts will build a solid foundation for project approval and eventual production.

Impact on the Kimberley Region’s Energy Landscape

The Rafael Gas Project is highly relevant to the Kimberley region’s energy landscape. The Western Australian Government’s plan to overhaul the Kimberley energy system by 2028 aligns well with the project’s goals. Currently, gas must be transported over vast distances from the Pilbara, with remote communities relying on diesel for power.

Rafael offers a locally sourced, lower-emission energy solution. The project has the potential to meet regional energy demands for decades while reducing reliance on diesel in industrial applications. By providing a more sustainable energy source, the project will play an essential role in improving energy access for communities in northern Western Australia.

Economic and Operational Outlook

Economic screening has highlighted the substantial value of the Rafael Gas Project. Buru Energy has identified a significant pre-tax net present value (NPV) for the project, taking into account the estimated gas and condensate prices. The production profile is designed to generate steady daily output of LNG and condensate, which will significantly contribute to the company’s operational cash flow.

Based on projected cash flows, the project has the potential to more than double Buru Energy's current market capitalisation. With a strong resource base, favorable regulatory conditions, and a cost-efficient development model, Buru Energy is positioning Rafael as a key energy project for the region’s future.

Buru Energy Ltd’s Role in the ASX Energy Sector

Buru Energy Ltd is becoming an integral player in the ASX energy stocks sector. The Rafael Gas Project marks a pivotal shift in the company’s operations, from exploration to production. As Buru advances through its development milestones, the project will contribute to the broader energy landscape, supporting the Kimberley’s energy needs while providing long-term cash flow to Buru Energy. The strategic partnership with CEFA and the project’s economic outlook further solidify Buru Energy’s role in the regional energy market.

The Rafael Gas Project positions Buru Energy Ltd as a growing force in Western Australia’s energy sector, aligning with regional development goals and contributing to the region's transition toward more sustainable energy solutions.