Buru Energy: Ungani oil field producing well, good pressure communication between wells noted

Friday, June 29, 2012 by Bevis Yeo

(ASX: BRU) has been producing oil from Ungani oil field at or above expectations with noticeable pressure communication between the two producing wells.

The company said this confirmed the very high quality of the Ungani reservoir and highlighted the fact that there is no compartmentalisation between the wells, which could indicate that reserves may be at the high end of the current range.

This has being reinforced by the very rapid pressure build ups observed when the wells are shut-in.

However, Buru noted that only a relatively small amount of oil had been produced to date and while there had been discernible pressure drawdown or formation water production, it is still too early to make more accurate estimates of reservoir size than the current range of between 5 and 20 million barrels,

While the extended production test started on May 31, some of the mud and drilling fluids that were lost to the formation are still being produced in the well stream.

This is expected to take several weeks of continued production to finally clean up the wells.

Ungani-1 had produced at rate of up to 3750 barrels per day (bpd) of oil and has produced about 3112 barrels of oil to date while Ungani-2 has flowed up to 1400bpd and produced 5656 barrels of oil to date.

Buru will continue to flow each well alternately at high rates to assist with clean-up, with an estimated average combined production rate of up to 700bpd.

It added the low key and trouble free operation increased confidence that production increases will be achievable easily.

The company had previously said it expected a marginally positive cash flow from the extended production test, which will take about 6 months to complete.

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Source: http://www.proactiveinvestors.com.au/companies/news/30718/buru-energy-ungani-oil-field-producing-well-good-pressure-communication-between-wells-noted-30718.html

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