Oil shocks are putting alternative supplies back in focus, with Bounty looking to Liberia’s deepwater frontier. Pic: Getty Images

Geopolitical shocks put oil and gas supply security back in focus
Bounty moves to secure exposure to deepwater Block LB-32 off Liberia
Modern seismic maps large undrilled fan prospects including Jupiter and Zeus

 

If there’s one thing the conflicts in the Middle East have brought starkly to light, it is the importance of diversifying oil and gas supply to limit the impact of market disruptions.

The first rumbles came when US and Israeli military strikes on Iranian targets began on February 28, 2026, with Iran declaring the critical Strait of Hormuz closed on March 2.

Closing the vital transport artery restricted a route that normally carries about a quarter of the world’s seaborne oil and a fifth of global LNG trade, sending energy prices higher.

While concerns eased in June following a temporary truce, the unpredictable nature of geopolitics quickly reared its ugly head when the agreement unravelled the very next month.

Matters have become worse in recent weeks after Houthi forces in Yemen launched attacks on Saudi Arabian oil infrastructure and threatened key shipping routes.

This sent oil prices sharply higher, with benchmark Brent crude breaking through the US$100 per barrel mark and trading above it for much of September.

What the uncertainty highlights is the need to develop new sources of oil and gas in stable jurisdictions outside traditional regions to insulate markets from geopolitical shocks.

 

Taking steps

Bounty Oil & Gas (ASX:BUY) is one company moving to secure exposure to a potential alternative supply source.

It has entered into a binding share sale agreement to acquire PetroQuest Liberia Deep Water, which holds a letter of engagement with the National Oil Company of Liberia (NOCAL).

Under this agreement, NOCAL will negotiate and enter a production sharing contract with the Liberia Petroleum Regulatory Authority in relation to Block LB-32, a deepwater exploration block in the Harper Basin.

On execution of the PSC, NOCAL has agreed to grant PetroQuest an equity interest in the block.

LB-32 is covered by modern 2D and 3D seismic, which BUY plans to access to complete due diligence, quantify prospective resources and potentially identify drill-ready prospects for farm-out.

Initial interpretation of the 2322km2 block indicates that it hosts a significant portion of the Jupiter and Zeus deepwater fan prospects as well as other leads.

The Liberian margin hosting LB-32 is interpreted to be the conjugate margin to Guyana, where major oil discoveries led by supermajor ExxonMobil in the Stabroek Block have defined about 11 billion barrels of oil equivalent in recoverable resources.

As most of the PSC commercial terms have already been detailed in the legally binding letter of engagement, the PSC negotiations and parliamentary approval are expected to be concluded by January 2027 or shortly thereafter.

Block LB-32 off Liberia. Pic: Bounty Oil & Gas

 

Oil targets

The primary target at Block LB-32 is the Upper Cretaceous basin floor fan play.

Both Jupiter and Zeus are fans of this type and are stratigraphically trapped, sealed by Upper Cretaceous deep-marine shales that have proven effective in every well drilled along the Liberian margin.

They also sit directly above two regionally mature source rocks, the Aptian lacustrine and Cenomanian-Turonian marine shales, with equivalent source-rock systems associated with major discoveries at Jubilee in Ghana, Sangomar in Senegal and across the Guyana-Suriname Basin.

Live oil was previously recovered from Upper Cretaceous slope fan and channel sandstones in the adjacent Liberian Basin during the 2009-2016 drilling campaigns.

This places LB-32 adjacent to a proven active oil-prone petroleum system, though the basin floor fan play outboard of those discoveries remains undrilled in both the Liberian and Harper basins.

Secondary targets include Upper Cretaceous slope fans and channels, Lower Tertiary basin floor fans and the deeper Aptian-Albian syn-rift play.

 

Experience brought to bear

To maximise value for its existing projects and the proposed entry into Block LB-32, Bounty has engaged GBA Capital executive director David Wall to assist with its strategy.

Wall has extensive experience in the oil and gas sector having served in strategy at Woodside Energy and as an energy analyst at Hartleys and Argonaut.

He also served as the managing director of Tangiers Petroleum then 88 Energy (ASX:88E) following a name change, from April 2014 to May 2021.

During this time, he oversaw the drilling of multiple wells and a significant appreciation in its market capitalisation.

Wall executed several successful farm-outs, including 60% in Area A at Project Icewine in Alaska to Premier Oil in exchange for the funding of the Charlie-1 well up to US$23m and 50% of Project Peregrine to Alaska Peregrine Development Company, which committed US$11.3m towards drilling Merlin-1.

He was instrumental in facilitating the listing of other start-up explorers such as Zimbabwe-focused Invictus Energy (ASX:IVZ) and Taroom Trough explorer Elixir Energy (ASX:EXR).

In conjunction with the acquisition, Bounty has received firm commitments to raise more than $3.547 million in a placement at 1.2 cents per share.

This has been cornerstoned by Tribeca Investment Partners, L1 Capital Global Opportunities Master Fund and S3 Consortium.

 

 

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.