Rey Resources Limited, an Australian energy resources exploration and development firm, referred Monday to an Australia Securities Exchange announcement by Buru Energy Limited Friday April 11 providing an operations update and noting that its 2014 exploration program of prospects along the Ungani trend in Western Australia was under review.
Buru is the operator of a Joint Venture (JV) over EP457 and EP458, together referred to as the Fitzroy Blocks, in northern Western Australia. Rey holds a 25 percent interest (including a 10 percent free carry to production) in the JV along with Buru (37.5 percent and operator) and Diamond Resources (Fitzroy) (37.5 percent) which is a 100 percent subsidiary of Mitsubishi Corporation (MC).
The Directors of Rey Resources are considering preliminary proposals for extensive 2D and 3D seismic over the Fitzroy Blocks in 2014. In addition, in the event that the JV decides not to propose a well in the Fitzroy Blocks later in 2014, it is the present intention of Rey to investigate a sole risked well under the terms of the JV agreement. Rey is currently in discussion with external financiers to determine the availability of support for such a project. The financing of the project could take the form of an economic interest in the proposed well or some other agreed structure related to the Fitzroy Blocks.
The Fitzroy Blocks are believed to be on trend from the Ungani Field which includes the recent Ungani discovery. Around 145 line miles (234 line kilometers) of 2D seismic data was acquired over the Ungani Trend in EP457 in 2013. Processing of seismic data commenced in January 2014 and final processing data was only completed and received from the operator in early April 2014. Final analysis of the seismic data is not yet complete and development of the proposed 2014 work program is not yet finalized.
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