Mid cap energy stock, Buru Energy ((BRU)), has entered Macquarie’s sights as it strives to make a name in Western Australia’s Canning Basin. Macquarie has initiated coverage on the stock with a $3 price target, offering 38% upside to the current share price.
Macquarie thinks the reaction to the drilling update at Ungani-3, which pointed to a larger but poorer quality reservoir, was a little harsh, as there is no great implications for the core development. Still, Buru will need to have success in exploration or further news on the gas appraisal to rally from here, in the broker’s opinion.
Buru Energy has provided more information on Ungani, after five months of limited drilling activity. The company has secured a rig for further exploration across the Ungani oil trend and committed to the next phase of testing the vast Laurel wet gas formation.