Buru Energy Spuds Yulleroo 4 Appraisal Well

Buru Energy advises that drilling operations on the Yulleroo 4 well started at 1200 (local time) Saturday using Ensign Rig 32. As at 0600 on Monday, the well was drilling ahead at 98 feet (30 meters).

Yulleroo 4 is the first well in the Buru – Mitsubishi Corporation 2013 drilling program.

The Yulleroo 4 well is located in exploration permit EP 436, 50 miles (80 kilometers) to the east of Broome. The well has a programmed total depth of 3,800 meters and is expected to take some 52 days to drill and suspend. Buru and MC each have a 50% interest in this well and in EP 436.

The Yulleroo wet gas accumulation was identified by the Yulleroo 1 well that was drilled in 1967 and tested gas at low rates from a very substantial gas column in a thick sequence of shales and sands in the Laurel Formation. The Yulleroo 2 well was drilled in 2008 by ARC Energy to appraise the Yulleroo 1 discovery, and recorded strong gas shows at the same stratigraphic level as Yulleroo 1. Buru conducted a successful reservoir stimulation operation at Yulleroo 2 in 2010, demonstrating that the reservoir was capable of flowing gas of good quality with significant hydrocarbon liquid content.

The Yulleroo 3 well was drilled by Buru and MC in 2012 and had strong gas shows over an interval of over 4,921 feet (1,500 meters). This intersection added over a thousand meters of gas charged section above the previously interpreted top of the gas sands in Yulleroo 1, together with a number of additional sand packages. Significantly, a thin sand at around 10,499 feet (3,200 meters) is interpreted to have conventional reservoir properties. This sand has the potential to materially improve the flow rates from this well without requiring any reservoir stimulation. If this sand is developed over a larger area with similar reservoir properties it is expected to add significantly to the commercial potential of the field.

In a broader context, the gas wetness ratios and inferred pressure data in the Yulleroo 3 well are indicative of the Yulleroo accumulation being part of a basin centred gas system similar to that seen in the Valhalla area.

The Yulleroo 4 well is therefore being deliberately drilled at the limits of structural closure of the Yulleroo structure, as interpreted from the 3D seismic data acquired over the field in 2011. The well will test the extent of the gas column in this part of the accumulation and isexpected to confirm Buru’s interpretation that the Yulleroo field is part of a geographically extensive basin centered gas accumulation extending beyond the mapped structural closure. If this is proved to be the case, the Yulleroo area has the potential to hold several trillion cubic feet of gas.

The well will also help define the extent and potential recoverable volumes of gas from the conventional 10,499 feet sand identified in Yulleroo 3.


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