In its weekly drilling report to the Australian Securities Exchange yesterday, Buru said its drilling program identified a 5m sandstone interval at the top of the Anderson formation at about 1560m with good permeability, from which it recovered an oil sample.
Buru executive director Eric Streitberg called the result an "excellent outcome for the Ungani area and the Canning Basin generally", with an oil discovery in a new play for the Ungani area.
"There has been previous oil production from the Anderson Formation in the Canning Basin but it was on the Lennard Shelf in Buru Energy's Blina tenements on the other side of the Canning Basin, over 125km from this discovery," he said.
"Not only is this a play opening discovery in the Ungani area but there are numerous leads and prospects at this shallower level in the area and these will now be evaluated for future drilling."
Independent analyst Peter Strachan told Energy News that at 450 millidarcies, the "excellent" porosity-rich column should "flow like the clappers", adding that Buru must now be just about on top of the target Ungani Dolomite formation.
"That Anderson formation is the same one that produces about 5-6 million barrels of oil at Blina on the other side of the basin, so it's not an unknown formation to have oil; but it's not known on that southern side of the trough where Ungani is," Strachan said.
The good part about it as far as Strachan is concerned is that it's conventional oil, which is what Ungani ideally wants, not unconventional, which the analyst believes is impossible to commercialise with the oil price under $US100/barrel. West Texas Intermediate had plunged to $33.97 yesterday.
Buru has unconventional prospects at Yullaroo and Paradise Deep.
"Being only 5km from Ungani itself, it means the cost of developing it is bugger-all, because you just put a pipeline across to the existing facilities at the Ungani plant. If they can get an extra 1000bpd out of that, then it's looking pretty good.
"It will be interesting to see what the quality of the oil is in the Anderson."
While Buru has much of the ground around it stitched up, it has recently been dropping acreage in the more remote and less prospective ground, Strachan does not expect the discovery to be huge - somewhere between 2-6MMbbl.
The important thing is that it opens up the basin for an additional play types, because they've been chasing the Ungani Dolomite yet found a new play in the Anderson.
Buru (50%), which is fully carried for the well by Diamond Resources (50%), said the next step is to drill on and see what awaits them in the Ungani Dolomite section - the well's main target - where a 5-inch casing will be run, releasing the Atlas Rig 2.
Specialise coring rig DDH1 Rig 31 will then be rigged up and start coring through the Ungani Dolomite reservoir section.
The well is an on all-weather drilling pad about 1km off the Ungani trend access road within Production License L21, 97km east of Broome and 3.3km southwest of Buru's famed Ungani oilfield which made the company.
