Buru Energy Limited has released the weekly update on drilling operations at the Valhalla-2 well.

The Valhalla-2 well is the first well in the Buru - Mitsubishi Corporation ('MC') 2011 Joint Exploration Program. Buru and MC each have a 50% interest in this well and in EP 371, with MC contributing 80% of the cost of the well under the terms of its farm-in agreement with Buru.

Since the last progress report a full suite of wireline logs have been run and rotary sidewall cores have been cut including specialised wireline logs to assist in the detailed analysis of the potential of the section for unconventional gas and liquids. These logs and sidewall cores will assist in the full evaluation of the tight gas and shale gas potential of the Laurel section in the well.

Preliminary analysis of the results of Valhalla-2 indicate the presence of a wet gas charged section of tight and possible conventional gas reservoirs across a Laurel Formation interval of at least 1,300m. These results imply there is the potential for substantial gas accumulation to be present. Further interpretation and appraisal drilling will be required to define this potential.

As at 06:00hrs today, 7' premium completion casing was being run in the hole at 3,066m. The well will now be suspended for evaluation as a candidate for both hydraulic stimulation and conventional production at a future date. On completion of operations on the well the rig will be released and mobilised to the Ungani-1 well site. The Company expects this to be the last drilling progress report for Valhalla-2.

Tags: Buru Energy