Buru Energy (ASX: BRU) has successfully raised A$5.3 million via a two-tranche institutional placement to fund activities at its Rafael gas project in Western Australia.
Specifically, A$1.3 million will cover working capital and offer costs, with the remainder funding environmental approvals, land access, commercial, marketing, financing work, engineering, and well planning.
The project has seen its economics significantly enhanced by engineering optimisations including higher condensate yields and an added LPG stream.
The placement involved the issuance of approximately 355 million new fully paid ordinary shares at A$0.015 per share.
Placement participants will also receive one free attaching option for every two shares, exercisable at A$0.022 with a three-year expiry.
Optimisations Significantly Enhance Rafael Economics
Engineering studies for the Rafael project have identified additional liquids and a previously unincorporated LPG stream.
These optimisations are projected to increase the annual pre-tax cashflow by a stated 20-47% compared to the 2025 screening.
The estimated internal rate of return range for the project has also seen a significant uplift, now projected between 42% and 80%, depending on the commercial model.
This enhancement to the project's value drivers strengthens the case for future funding and reserves certification.
Revised Timeline Targets April Quarter 2027
Buru Energy has extended the Rafael project timeline to allow it to fully incorporate the updated technical and value gains into its final funding, partnering, Final Investment Decision (FID), and reserves certification framework.
The revised development timeline targets Rafael 2H verification and appraisal drilling, along with Rafael 1 recompletion, in the April quarter 2027.
The use of proceeds from the recent placement will support these pre-FID activities.
They include critical environmental approvals, securing land access, advancing commercial and marketing efforts, progressing financing work, and undertaking further engineering and well planning.
Strategic Rafael Focus
Buru's 2025 Annual Report, released in March 2026, highlighted a strategic shift, confirming the Rafael project as the primary value driver for the company.
The report detailed a Strategic Development Agreement (SDA) signed in April 2025 with Clean Energy Fuels Australia (CEFA).
This partnership is designed for CEFA to finance, build, own, and operate the LNG and condensate midstream infrastructure, with Buru retaining 100% upstream interest and a tariff arrangement to CEFA with the aim of materially reduce Buru's upstream funding exposure.
The Annual Report also outlined key regulatory progress for the planned 2026 appraisal drilling program, including securing a two-year extension for its production licence application and obtaining key WA environmental approvals.
The company had targeted a FID in the second half of 2026, with first gas and material cash flows expected from Q1 2028 or mid-2028.
Previous coverage indicated the project was not likely to come online until Q1 2028, a revision from an earlier 2027 hope.
