Brookside Energy (ASX: BRK), an Australian junior oil and gas company, is positioning itself to navigate the current turbulence in the oil and gas sector with strong operational discipline, near-term cash flow, and robust reserves. The company has announced that it is targeting first production and sales from its new Bruins Well project this quarter.
Located in the prolific Anadarko Basin, Brookside has mobilized completion crews and equipment for its ninth well within the SWISH Play acreage in Oklahoma. Managing Director David Prentice stated, “The Bruins Well represents a key step in unlocking the full potential of our Bruins DSU. We remain focused on delivering optimal production and cash flow outcomes from this well in the near term.”
This announcement follows Brookside’s recent March quarterly report, which highlighted an increase in reserves and a strong cash position, setting the stage for the company to capitalize on the anticipated recovery in the oil and gas sector.
What sets Brookside apart is its below-industry-average operating costs, reported at around $9 per barrel of oil equivalent (BOE). Prentice emphasized, “Our business is built to thrive in tough markets. We run lean and disciplined.” This efficiency allows Brookside to remain cash flow positive even when oil prices dip.
Current West Texas Intermediate (WTI) prices hover around US$56 per barrel, creating challenges for many U.S. oil producers. Independent research firm Rystad Energy notes that these producers face all-in breakeven prices exceeding US$62.50. In contrast, Prentice noted, “Even if we stopped drilling after Bruins and prices stayed low for the next five years, we’d still generate more cash flow than our current cap during that time.”
Brookside’s production averaged 1,920 BOE per day on a net basis during the March quarter, driven by high-value liquids-rich barrels that continue to enhance revenue and margins. The company boasts a cash position of A$12.68 million, up almost 12% from the previous quarter, following cash receipts of A$18.1 million in the same period.
With proven reserves of 12.35 million barrels of oil (MMBO), Prentice expressed confidence in Brookside’s ability to withstand current market conditions, stating, “We have the resilience to navigate these challenges.”
Brookside has given its name to the SWISH Play, which refers to the Sycamore and Woodford shale formations in the Southern Half of the South Central Oklahoma Oil Province (SCOOP). The area has attracted larger American companies that have followed Brookside’s lead, further validating its strategic position.
Prentice remarked, “We made this discovery, and some of the clever work we did early on in prospecting delivered these results. We have the capacity and capital to repeat that, so we’re excited about adding opportunities and more barrels when market conditions improve.”
As Brookside Energy pushes forward with its Bruins Well project, it demonstrates a strong commitment to operational efficiency and resilience in a challenging oil market. With a solid production base and financial strength, Brookside is well-positioned to capitalize on future opportunities in the Anadarko Basin, reinforcing its role as a key player in the oil and gas sector.
