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Buccaneer Energy Limited (ASX:BCC) Kenai Loop - Final Testing Results.

Sydney, Australia, Jan 17, 2013 - (ABN Newswire) - Buccaneer Energy Limited (ASX:BCC) is pleased to advise the final production testing results from the 100% owned Kenai Loop # 4 well:

HIGHLIGHTS

- Successfully completed 4 point test from one zone totalling 20' gross pay

- Shut in wellhead pressure peaked at 3,899 psi

- Absolute open flow potential ("AOFP") of 9.0 MMCFD achieved from 10,300' sand

- Long term production rate targeted at 3.0 - 4.0 MMCFD (580 - 750 BOEPD1)

- Kenai Loop field production rate to increase to 10 - 11 MMCFD (1,666 - 1833 BOEPD1) from two wells

- Winter peak gas pricing has been up to US$22.00 / MCF

The Kenai Loop # 4 well was shut-in for a 20 hour period with shut-in tubing pressure peaked at 3,899 psi. A flow test over 4 different choke sizes, a 4 point test, was then successfully conducted. This test includes the measurement of pressures at each of the choke sizes which allows for the calculation of the AOFP.

A 10' section of the upper most sand at 10,300' measured depth was perforated, this sand has gross pay of 20' and correlates to the 9,700' sand in the Kenai Loop # 1 well and the AOFP was calculated as 9.0 MMCFD.

The long term deliverable production rate from the Kenai Loop # 4 well is estimated to be 3.0 - 4.0 MMCFD (500 - 667 BOEPD1). The addition of the Kenai Loop # 4 well will increase the field's total production rate to 10.0 - 11.0 MMCFD (1,666 - 1,833 BOEPD1).

The Kenai Loop # 1 well performance continues to be excellent and is currently producing 6.5 - 7.0 MMCFD (1,083 BOEPD), the Company is selling 5.0 MMCFD into its long term gas contract with ENSTAR at a annual weighted

average price of US$6.24 / MCF. In addition, the Company has sold on a temporary basis 1.5 MMCFD to two smaller non-utility Cook Inlet users at US$15.00 / MCF.

South-central Alaska is currently experiencing severe gas shortages and the winter peaking pricing of incremental gas supply has reached US$22.00 / MCF. This high pricing range is weather and supply related and could remain in place while winter heating conditions persist; the additional gas available from Kenai Loop field is capable of being sold into this spot market.

The Company has identified temporary portable production equipment to allow an early start-up of production from Kenai Loop # 4 and estimates the well will be on production in 3 - 4 weeks, thereafter the Company will build permanent production facilities at Kenai Loop when weather conditions permit.

The Company will now engage a third party engineer to restate reserves at the 100% Kenai Loop project.

View the Buccaneer Energy announcement at the link below:

http://media.abnnewswire.net/media/en/docs/ASX-BCC-716467.pdf

About Buccaneer Energy Limited:

Buccaneer Energy Limited (ASX:BCC) is an Australian listed company focused on onshore and shallow waters of the Cook Inlet of Alaska and the Gulf of Mexico, as well as onshore Gulf Coast assets that have been left behind or overlooked by other players.

The Company has a large existing portfolio and disciplined acquisition strategy focused on opportunities with:

- Assets with attractive economics;

- Assets that have existing infrastructure in place that can be accessed;

- Assets near a commercial market that has been de-risked; and

- Assets that have multiple stacked pay targets.

Buccaneer's management team has a proven track record of finding and exploiting oil and gas reserves and generating new opportunity deal flow.

Copyright 2012 ABN Newswire

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Publication:ABN Newswire
Date:Jan 17, 2013
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