Buru Energy Ltd., Perth, has moved to a 100% interest in Ungani oil field in the onshore Canning basin of Broome in Western Australia following a transformational deal with its joint venture partners Diamond Resources (Fitzroy) Pty. Ltd. and Diamond Resources (Canning) Pty. Ltd. Both Diamond companies are wholly owned subsidiaries of Mitsubishi Corp.
Buru Energy restarted production from Ungani field in March (OGJ Online, Mar. 10, 2017).
Based on the deal, Buru will gain Mitsubishi’s 50% interest in Ungani production leases L20 and L21 as well as Mitsubishi’s 50% interest in exploration permits EP 391, EP 431, EP 436, and EP 428.
In return, the Mitsubishi companies will gain Buru’s 50% interests in Canning basin permit EP 371 and in the application for a special authority STP-SPA-0065 and STP-AAA-0031.
Buru Chief Executive Officer Eric Streitberg says the asset swap enables each company to hone in on their respective corporate objectives by focusing on the areas where they have the most appropriate technical and commercial capability without having the corporate and commercial boundaries that existed in the earlier combine.
For Buru, the focus is on conventional oil and gas. The transaction means Buru will have 100% of the cash flow from Ungani field as well as 100% of the prospective exploration permits along the Ungani trend and exposure to the Laurel tight gas accumulation.
The Mitsubishi group will have 100% of the resources in the prospective Canning basin shale gas permits.
As part of the arrangement, Buru has agreed to provide services to Mitsubishi in EP 371 including engagement and liaison with the local community.
The transaction is binding as of May 24 and the instruments of transfer will be lodged with the Western Australia Department of Mines and Petroleum.
Buru intends to review the forward field development at Ungani to ensure the company is able to obtain maximum commercial benefit from a tailored program.
Ungani field lies about 100 km east of Broome.