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Highlights
- Buru Energy secures infrastructure partner for Rafael Gas Project
- Agreement limits financial exposure and targets 2027 cashflow
- Ongoing asset divestments strengthen strategic focus
Buru Energy (ASX:BRU) has taken a significant step forward in advancing its Rafael Gas Project by signing a Strategic Development Agreement (SDA) with Clean Energy Fuels Australia. The agreement paves the way for the project’s progression toward a Final Investment Decision (FID) by late 2025, with targeted first cashflow in the second half of 2027.
Under the SDA, Clean Energy Fuels Australia will finance, construct, own, and operate all Rafael LNG and condensate infrastructure. This approach reduces the capital burden for Buru Energy and allows it to focus on upstream operations, significantly mitigating financial risk related to infrastructure development.
In preparation for the Rafael Gas Project’s next phase, Buru Energy plans to retest the Rafael 1 well during the third quarter of 2025. The aim is to support independent reserves certification and establish the well as a long-term producer. In addition, interpretation of the recent Rafael 3D seismic data has unveiled promising potential for further hydrocarbon discoveries near the original Rafael field, hinting at future expansion opportunities beyond the current scope of the project.
While sharpening its focus on core developments, Buru Energy continues to streamline its portfolio. The company is targeting the completion of the 2H Resources divestment in the second quarter of 2025. A significant milestone in this direction was the recent completion of the Battmin divestment. As part of the transaction, Sipa Resources (ASX:SRI) has executed a Sale and Purchase Agreement, and Battmin will receive a 0.6% Net Smelter Return royalty from any future production. An option is also in place to repurchase this royalty for $0.6 million, offering future strategic flexibility.
On the financial front, Buru Energy reported a market capitalisation of $33 million and cash reserves of $5.5 million with no debt as of 31 March 2025. The company has 779.4 million shares on issue, and over the past year, its share price has ranged between 3.2 cents and 12.5 cents.
Buru Energy's progress in forging strategic partnerships and shedding non-core assets reflects a clear roadmap toward project execution and monetisation. The SDA with Clean Energy Fuels Australia marks a crucial milestone, enabling Buru to progress with confidence and reduce exposure while preparing for potential revenues from the second half of 2027.
