Lion Energy Limited (ASX:LIO) has commenced drilling at the Bula Karang-1 (BK-1) exploration well in the East Seram PSC, Indonesia, with the well spudding on 9 November 2026 using Silver City Drilling Rig 20. Lion operates the well with a 45% working interest.

Key Points

  • Drilling commenced at the Bula Karang-1 exploration well on 9 November 2026 using Silver City Drilling Rig 20 on Seram Island, eastern Indonesia.
  • BK-1 targets a gross P50 unrisked prospective oil resource of 12 million barrels in the primary carbonate objective, with an estimated 38% geological chance of success.
  • Lion Energy holds a 45% working interest and is operator; partner OPIC holds 55% and is funding 88% of drilling costs up to US$5.6 million, with total well cost estimated at approximately US$6.7 million.
  • The broader Bula Bay carbonate play, including nearby follow-up prospects, contains combined P50 unrisked prospective resources exceeding 30 million gross barrels of recoverable oil.
  • Drilling and initial evaluation activities are scheduled for completion by early December 2026.

Bula Karang-1 Well Design and Drilling Programme

BK-1 is being drilled as a deviated well from an onshore location, targeting a carbonate structure crest at approximately 550 metres subsea. The drilling programme begins with a 26-inch hole to approximately 80 feet for the 20-inch conductor casing, then progresses through a 16-inch surface hole to approximately 560 feet, directional drilling in a 12¼-inch hole to approximately 2,500 feet measured depth building to 84 degrees inclination, and an 8½-inch hole to approximately 4,500 feet measured depth penetrating the primary Lower Fufa Carbonate target expected at approximately 4,524 feet measured depth. A planned total measured depth of approximately 5,400 feet is targeted.

Reservoir Evaluation and Testing Activities

Following primary reservoir entry, a 6-inch hole will be drilled approximately 100 feet into the Lower Fufa Carbonate. A drill stem test will be undertaken if hydrocarbon shows are encountered, to evaluate reservoir characteristics and potential hydrocarbon productivity. Evaluation will include logging-while-drilling measurements, analysis of drill cuttings, and monitoring for oil and gas indications. The drilling programme will also evaluate secondary sandstone objectives and potential hydrocarbons within the historic Bula Field interval along the well path. If no oil or gas shows are encountered, the well may be shortened.

Post-Drilling Plans and Broader Play Potential

Following completion of drilling, the drilling rig and associated equipment will be demobilised. According to the filing, a smaller service rig and production testing equipment are planned to be mobilised during Q1 2027 to undertake further production testing, subject to the results of the initial drilling and evaluation programme. The filing states that nearby Bula field infrastructure provides a path from discovery to first oil. The Bula Bay carbonate play, including nearby follow-up prospects, contains combined P50 unrisked prospective resources exceeding 30 million gross barrels of recoverable oil.