Carnarvon Petroleum Limited is considering a range of new development options for the historic Buffalo oil field off the WA coast after new studies identified $1.5 billion in potential value.
The company said an independently audited volumetric estimates of contingent resources in the Buffalo oil field had identified that were 31 million barrels of recoverable oil still remaining.
This would make a new development of the field commercially viable, with a potential revenue generating capacity of approximately US$1.5 billion to Carnarvon at current oil prices.
Carnarvon has identified a range of options to redevelop the field and scoping studies show that the redevelopment of the Buffalo oil field is economic at current oil prices; even at the 1C outcome.
The company said this indicates the project to be low risk, and gives Carnarvon the confidence to advance the project immediately.
Upgrading these contingent resources to reserves will require a commitment to develop, encompassing a field development plan and a production license across the Buffalo field. Work on both of these is underway.
Carnarvon’s managing director and CEO, Adrian Cook, said the next steps will focus on the field redevelopment and include securing a production licence and associated approvals, advancing redevelopment plans and supplier commitments and finalising funding for the redevelopment activities.
“While significant work is still required, we are incredibly encouraged by the potential and are pushing forward with the view to bringing the Buffalo field into production.”
The Buffalo oil field was discovered with the drilling of the Buffalo-1 well in 1996. One further appraisal well was drilled before a commitment was made by BHP to develop the field with two wells tied back to an FPSO with first oil in 1999. A further two infill wells were drilled in 2002 with the production ceasing in 2004 when the field was still producing around 4,000 bopd. Total production from the field until 2004 was just over 20 million barrels of oil. The field was abandoned and all infrastructure removed.
The Buffalo reservoir is world class, with the original development exceeding 50,000 bopd from two wells within 48 hours of coming onstream. The oil is a premium light oil with an API of 53 degrees. The Buffalo 3, 5, 7 and 9 wells were the only production wells.
Carnarvon Petroleum acquired the WA-523-P exploration permit, containing the Buffalo oil field, in 2016 with the primary work programme being to better interpret the top reservoir of the three known oil accumulations in the block, the Bluff and Buller oil columns and the Buffalo oil field.