PERTH (miningweekly.com) – The Ungani onshore oilfield, in the Kimberley was officially opened this week, marking the first oil development in the region in nearly 30 years.

Mines and Petroleum Minister Bill Marmion said the joint venture (JV) between ASX-listed Buru Energy and Mitsubishi Corporation was expected to provide several economic benefits for the Kimberley region.

“This project will generate opportunities and benefits for local people, including traditional owners, local businesses and for the state in general. Ungani is an excellent example of how the oil and gas industry can generate positive returns for all sectors of the local community.”

The project is located some 100 km east of Broome and started production at a rate of 1 250 bbl/d of oil. Output would increase to a targeted rate of 3 000 bbl/d of oil.

Buru executive chairperson Eric Streitberg said the development of Ungani reflected the cooperative spirit of all the parties involved.

“Ungani is the first oil development in the Canning basin in over 30 years. There was no modern precedent for the development and it took perseverance and cooperation between all parties to make the transition from a greenfield oil discovery to the current production system.”

Streitberg said the JV partners were also undertaking a systematic exploration programme to expand the oil reserve base.

Marmion, meanwhile, said the project marked a key milestone in the company's strategy to become a major oil and gas producer in Western Australia's Kimberley region.

The Chamber of Minerals and Energy of Western Australia (CME) has welcomed the opening of the Ungani onshore oilfield, with CEO Reg Howard-Smith saying the Kimberley region would benefit from economic developments offered by the resources sector.

“While the project will deliver royalties to the state government, positive opportunities will also flow to the local community over time. Most importantly, traditional owners and the local community will benefit from projects such as Ungani,” said Howard-Smith.