BUY licences 3D seismic data covering offshore oil targets

Our oil exploration Investment Bounty Oil & Gas (ASX: BUY) just kicked off technical due diligence on its offshore Liberia block.

This is the deepwater block BUY is acquiring the exclusive right to negotiate a Production Sharing Contract (PSC) over.

The same block that the vendors estimated ~4.5BN barrels of “OOIP” (Original Oil In Place), unrisked, based on the screening volumetrics.

AND is next door to $280BN capped TotalEnergies that holds a block with ~7.3 billion barrels of oil equivalent. (source)

According to a giant 127 page technical report from the vendors of BUY’s block - BUY’s block could end up holding extensions to the Total ground.

(Read the full technical report here)

(source)

Today, BUY confirmed that technical due diligence over the block has begun.

The single biggest takeaway from today’s announcement for us was this:

(source)

Basically, BUY has agreed terms with the owners of all the seismic data to access the data and put together a prospective resource estimate over its block.

That X barrel number we mentioned earlier is actually just the vendor groups internal geo team coming up with an estimate based on what they are seeing in the public domain.

Now, BUY will get access to ~656km² of 3D seismic and ~753 line-km of 2D data.

After which, BUY should be able to put together a prospective resource estimate over its block.

Hopefully, the numbers based on seismic are as good as the vendor groups internal estimates - as that is when we expect the market to start pricing in the potential upside of a multi billion barrel discovery.

(source)

Why we like BUY from a technical perspective

We did a pretty big deep dive in our initiation note (which you can see here).

BUT the main reason we liked the deal BUY did for these blocks is because the way deepwater targets are being explored has changed a lot inside the last ~10-15 years.

And NONE of the deepwater targets offshore in Liberia have ever been drilled.

Which we think is an opportunity - in a ‘post Guyana’ world.

For anyone who missed our initiation note.

The ultra deep water targets called “basin floor fan” plays were what delivered Exxon's ~11 billion barrels in discoveries offshore in Guyana.

Now, ultra-deep water targets are where most of the supermajors are focusing their offshore exploration around.

(basically on the hunt for the next Guyana)

~$280BN TotalEnergies which took 65% of the three blocks immediately west of the block BUY may end up owning - is going after those deep water “basin floor fan” targets.

Here is a visual summary of the basin floor fan concept AND why we care about them:

(source)

Here are the reasons we Invested in BUY from our launch note

What do we want to see BUY deliver next?

🔄 Complete the offshore Liberia acquisition

We want to see BUY complete the acquisition of the offshore Liberia block.

Here are the conditions BUY needs to meet to get the deal done:

(source)

🔄 Define a prospective resource based on 3D/2D seismic data

We want to see BUY put together a prospective resource estimate on its block based on 3D/2D seismic data (instead of personal gut feel from the vendor’s geo team).

We think that will be when the market really starts to get a better understanding of the project.

Here are the milestones we are tracking:

• ✅ Licence the 3D and 2D datasets (licensed today)
• 🔲 Reprocessing complete
• 🔲 Seismic data results
• 🔲 Targets confirmed (Zeus and Jupiter)

🔄Production Sharing Contract

We want to see BUY convert its “Letter of engagement” over its Liberian block into a Production Sharing Contract