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- Oil and gas company Buru Energy (BRU) virtually conducted its 2020 AGM for the first time, to maintain social distancing
- The company’s Chairman gave an address, discussing the dual impacts of COVID-19 and the oil price trade war on operations
- Buru has continued to steadily produce oil at its Ungani oilfield, but may suspend production later in 2020, if necessary
- The company claims to be capable of weathering these turbulent times, partly thanks to salary reductions and the government’s response
- Buru Energy is down 1.09 per cent on the market today, trading for 9.1 per cent each
Oil and gas company Buru Energy (BRU) virtually conducted its 2020 AGM for the first time, to maintain social distancing.
The company’s Annual General Meeting was dominated by the clear elephant in the room; the unprecedented economic turmoil currently sweeping the globe.
In particular, Buru’s Executive Chairman, Eric Streitberg, gave an address about the company’s current state. In it, he discussed the dual impacts of the simultaneous COVID-19 pandemic and OPEC+ oil price trade war. Both have taken a serious toll on countless industries and companies, especially in oil and gas.
Despite the historically low oil price, Buru has continued production at its Ungani oilfield. The company is currently producing at a steady rate of approximately 1,500 barrels of oil per day.
The next lifting from the CGL storage tank in Wyndham is in a few days’ time. Buru expects to receive payment that is in line with the average Brent price for May, minus the buyer’s normal fixed contract discount.
The company will decide in the third quarter whether or not to temporarily suspend production at Ungani. Buru is fortunate that it can suspend production without any material operational consequences, which it has done before.
With regards to COVID-19, the company has quickly and easily adapted to working in a primarily digital environment. Despite the disruptions it has caused to its exploration operations, Buru is in a strong financial position.
Buru is one of a few listed small Australian oil and gas companies with solid cash reserves, a strong asset base, and no material exploration commitments. While the company’s current share price is disheartening, Buru feels well-positioned to weather the ongoing storm.
Eric took a moment to acknowledge the people who had made the company’s continued survival possible.
“I would like to thank the staff of the company, many of whom have taken very significant salary reductions, but have continued to put in normal, and in many cases, more than usual hours in the business,” Eric noted. “I would also like to thank the many shareholders who have persevered with their investments, and recognise the considerable financial difficulty many of our smaller shareholders find themselves in.
“We have also been very fortunate to have a State Government that has taken a pragmatic and measured approach to the control of the COVID-19 pandemic. This has allowed us to continue our operations in a controlled and effective way. We thank the Premier and his team for their handling of the crisis,” he said.
Buru Energy is down 1.09 per cent on the market today, trading for 9.1 per cent each at 3:35 pm AEST.
