Toronto Stock Exchange-listed Bengal Energy has started field operations with the goal of transforming the company into an operating energy producer for the first time in Australia.
The anticipated incremental production has the potential to materially increase production levels to 550 to 700 barrels of oil equivalent a day from its projects in the Cooper Basin.
This increased production, coupled with recent spikes in benchmark Brent crude oil and Australia’s East Coast natural gas prices, has the potential to significantly improve cash generating capability and position Bengal for continuous growth.
At its Wareena project, two wells will be restarted with the goal of reducing or eliminating water production to promote gas production, with cumulative historic natural gas production from the two wells is more than six billion cubic feet.
The associated pipelines will also be reactivated allowing sales and export of gas via the Coonaberry compression station into the Santos raw gas infrastructure with natural gas transported to the Moomba processing facility.
The wells will be ready for extended production testing in April and Bengal expects to start exporting gas via the recommissioned pipeline in late quarter three.
At its Caracal project, Bengal plans to reinstate and stimulate the Caracal 1 well to start producing commercial volumes of light oil.
The crude will be lifted by Bengal’s refurbished Lufkin Roadrunner pumping unit which will be onsite in April.
The oil will be gravity separated in a tank and then offloaded into road tankers.
The company recently signed an offtake agreement with the neighbouring IOR refinery in Eromanga and, upon starting production, the Caracal project area is earmarked for further development of additional oil prospects.
Bengal chief executive officer Chayan Chakrabarty said the company was generating CAD$80-85 a barrel in field netback from its non-operated Cuisinier field oil production today.
He continued: “We have no debt, and all our free cashflows are getting deployed directly into our operated Wareena and Caracal project work.
“Several insiders – both directors, executive management, and friends and family – participated in our equity financing announced last week.
“Our future growth lies entirely in our operated assets, and we are excited to take the first step towards our growth this year with the commencement of the operated Wareena and Caracal project activities.
