How Buru’s CEFA Deal Could Unlock A$400M Value at Rafael Gas Project
Buru Energy has taken a major step forward in developing its Rafael Gas Project through a strategic partnership with Clean Energy Fuels Australia, aiming for first cash flow by late 2027. The company also divested non-core assets to focus capital on this flagship project.
- Strategic Development Agreement signed with Clean Energy Fuels Australia for Rafael Gas Project
- Rafael project projected to deliver A$400 million gross unrisked NPV and A$70 million annual cash flow
- Divestment of 2H Resources Pty Ltd and non-core Canning Basin blocks to Koloma Australia
- Ungani Oilfield remains under care and maintenance with farm-out plans for Mars prospect
- Company ends quarter with $2.3 million cash, no debt, and disciplined cost management
Strategic Partnership De-Risks Rafael Gas Project
Buru Energy has marked a significant milestone in its development journey by signing a Strategic Development Agreement (SDA) with Clean Energy Fuels Australia (CEFA) for the Rafael Gas Project. This partnership is designed to reduce Buru’s financial exposure by having CEFA finance, construct, own, and operate a modular LNG processing plant at the Rafael 1 well site. The plant, with a capacity of up to 300 tonnes per day, will serve regional customers in the Kimberley and north Pilbara regions, providing a locally sourced, reliable, and cost-effective alternative to imported gas and diesel.
The collaboration leverages CEFA’s expertise in small-scale LNG plants and distribution capabilities through its associated company EVOL LNG, which operates Australia’s largest LNG road tanker fleet. Supported by the OCTA Group and global infrastructure fund I Squared Capital, CEFA’s involvement brings both financial and operational strength to the project.
Economic Potential and Project Outlook
Economic screening of the Rafael Gas Project reveals a compelling value proposition, with a projected gross unrisked net present value (NPV) of approximately A$400 million and an annual gross cash flow before tax of around A$70 million. The project’s design focuses on a small footprint and low environmental impact by utilizing the already cleared Rafael 1 well pad, which should expedite regulatory approvals and land tenure arrangements.
Buru aims for a Final Investment Decision by mid-2026, targeting production and cash flow commencement by late 2027. This timeline positions Rafael as a cornerstone for Buru’s future growth and a transformative energy source for the region.
Asset Rationalisation and Focus on Core Projects
In line with its strategic focus, Buru has executed agreements to divest its 2H Resources Pty Ltd subsidiary and certain non-core exploration blocks in the Canning Basin to Koloma Australia Pty Ltd. The transaction, valued at up to A$2 million in staged payments, allows Buru to concentrate its capital and resources on the Rafael Gas Project while retaining an option to re-enter the hydrogen exploration business if economic conditions improve.
The company also continues to maintain the Ungani Oilfield under care and maintenance, with plans to farm-out the nearby Mars prospect. Mars, located approximately 9km north of Ungani, is considered a promising near-field target that could provide incremental oil production and strategic funding options.
Financial Position and Corporate Governance
As of 30 June 2025, Buru Energy reported cash reserves of A$2.3 million with no debt, reflecting a disciplined approach to cost management amid ongoing project development. The company’s market capitalisation stood at approximately A$18 million. Recent corporate actions include the retirement announcement of Non-Executive Director Robert Willes and the issuance of director options following shareholder approval at the Annual General Meeting.
While the company’s cash position is modest, management expresses confidence in meeting operational objectives through careful capital allocation, asset divestments, and potential farm-out arrangements.
Bottom Line?
Buru’s partnership with CEFA and asset rationalisation set the stage for Rafael’s development, but near-term funding and regulatory hurdles remain key watchpoints.
Questions in the middle?
- Will Buru secure the Final Investment Decision for Rafael by mid-2026 as planned?
- How successful will the farm-out of the Mars prospect be in providing additional funding and production upside?
- What are the timelines and risks associated with renegotiating native title agreements to restart Ungani production?
