TIDM88E

RNS Number : 5605Y

88 Energy Limited

17 January 2022

17 January 2022

This announcement contains inside information

88 Energy Limited

Merlin-2 Operations Update

Highlights

   --   Merlin-2 Permit to Drill in the final stages of review by the Bureau of Land Management (BLM) 
   --   Snow road construction commenced ahead of Merlin-2 drilling 
   --   Commissioning of the Arctic Fox rig commenced 
   --   Spud of Merlin-2 remains on track for February 2022 

88 Energy Limited (ASX:88E, AIM:88E, OTC:EEENF) (88 Energy or the Company) is pleased to provide the following update in relation to the Merlin-2 appraisal well activities, located in Project Peregrine in the NPR-A region of the North Slope of Alaska.

Commissioning of the Arctic Fox rig has commenced ahead of mobilisation to the Merlin-2 drilling location. Construction of the single lane snow road to the Merlin-2 location has also commenced, with good conditions noted in field and construction of the snow road on schedule.

Permitting and planning for the Merlin-2 well is now largely complete, with the well on track to spud in February 2022. The Merlin-2 Permit to Drill is in the final stages of review by the BLM and is on schedule to be issued ahead of rig mobilisation.

88 Energy notes that it is aware of media reports of correspondence to the BLM from the Center for Biological Diversity (CBD) with respect to the Permit to Drill for the Merlin-2 well. The CBD is a not-for-profit environmental activist group in the U.S..

With the current status of the review of the Permit to Drill by the BLM, as well as numerous other related approvals and permits from various government agencies, 88 Energy is nearing completion of permitting and the well remains on track to spud in February 2022.

The Merlin-2 appraisal well is planned for a Total Depth of 8,000 feet, and is targeting 652 million barrels of oil(1,2) in the highly prospective N18, N19 and N20 targets that were encountered in the successful Merlin-1 well (drilled in March 2021 to a depth of 5,267 feet). Merlin-1 demonstrated the presence of oil in these multiple stacked sequences within the Brookian Nanushuk Formation.

Further details on the upcoming operations at the highly prospective Merlin-2 appraisal well, and the Company's other activities, are contained in the Company's latest corporate presentation, which is available on 88 Energy's website at www.88energy.com.

1 Cautionary Statement: The estimated quantities of petroleum that may be potentially recovered by the application of a future development project relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration, appraisal and evaluation are required to determine the existence of a significant quantity of potentially movable hydrocarbons.

2 Mean unrisked prospective resource - Net Entitlement to 88 Energy. Refer announcement released to ASX on 16 August 2021

The below graphics can be viewed in the pdf version of this announcement, which is available on the Company's website www.88energy.com;

   --     Map showing location of Merlin-2 

-- Wireframe image showing respective Merlin-1 and Merlin-2 well locations, facing east and overlain with predicted reservoir sands profile.

   --     Project Peregrine and Recent Nanushuk Discoveries. 

Media and Investor Relations:

 
 88 Energy Ltd 
  Ashley Gilbert, Managing Director 
 
 Tel: +61 8 9485 0990 
  Email:investor-relations@88energy.com 
 
 Finlay Thomson , Investor Relations      Tel: +44 7976 248471 
 
 Fivemark Partners , Investor and         Tel: +61 410 276 744 
  Media Relations                          Tel: +61 422 602 720 
  Andrew Edge / Michael Vaughan 
 
 EurozHartleys Ltd                        Tel: +61 8 9268 2829 
  Dale Bryan 
 
 Cenkos Securities                        Tel: +44 131 220 6939 
  Neil McDonald / Derrick Lee 
 

Pursuant to the requirements of the ASX Listing Rules Chapter 5 and the AIM Rules for Companies, the technical information and resource reporting contained in this announcement was prepared by, or under the supervision of, Dr Stephen Staley, who is a Non-Executive Director of the Company. Dr Staley has more than 35 years' experience in the petroleum industry, is a Fellow of the Geological Society of London, and a qualified Geologist/Geophysicist who has sufficient experience that is relevant to the style and nature of the oil prospects under consideration and to the activities discussed in this document. Dr Staley has reviewed the information and supporting documentation referred to in this announcement and considers the resource and reserve estimates to be fairly represented and consents to its release in the form and context in which it appears. His academic qualifications and industry memberships appear on the Company's website and both comply with the criteria for "Competence" under clause 3.1 of the Valmin Code 2015. Terminology and standards adopted by the Society of Petroleum Engineers "Petroleum Resources Management System" have been applied in producing this document.

About Project Peregrine

Project Peregrine is located in the NPR-A region of the North Slope of Alaska and encompasses approximately 195,000 contiguous acres. It is situated on trend to recent discoveries in a newly successful play type in topset sands in the Nanushuk formation. 88 Energy has a 100% working interest in the project.

The Merlin-1 well was spudded in March 2021 with drilling operations completed in April 2021. Interpretation of results was completed in August 2021 with post well evaluation successfully demonstrating the presence of oil in N20, N19 and N18 targets, with 41 feet of net log pay across the three reservoir intervals noted and geochemical analysis determining the oil to have an estimated API gravity between mid-30 to low-40 API (light oil).

A second well, the Merlin-2 appraisal well, is planned to be drilled in Q1 2022 as a follow-up well to the Merlin-1 exploration well. Merlin-2 is targeting a net entitlement mean Prospective Resource of 652 million barrels (unrisked)(1,2) .

To view the Company's video and animated presentations of Project Peregrine, as well as the Merlin-1 well results and details of the Merlin-2 well, please click on the link to the 88 Energy website www.88energy.com .

Independent oil and gas reservoir evaluation consultancy, ERCE Australia Pty Ltd (ERCE), con ducted an updated assessment of the Project Peregrine prospective resources post the Merlin-1 well results. The updated prospective resource estimates and risking assessments for Project Peregrine are noted below.

Revised Project Peregrine Prospective Resources

 
 Project Peregrine: Alaska North                Unrisked Net Entitlement to 88E (1, 
  Slope                                         4) Prospective Oil Resources (MMstb) 
 Prospects (Probabilistic Calculations)    Low (1U)   Best    High      Mean     COS (3) 
                                                       (2U)    (3U) 
                                          --------- 
 Merlin-2 (Nanushuk - N20, N19 
  and N18)                                    64       329    1,467     652        56% 
                                          =========  ======  ======  =========  ======== 
 Merlin-1A (Nanushuk - N14S)                  25       87      282      132        17% 
========================================  =========  ======  ======  =========  ======== 
 Harrier (Nanushuk)                           41       175     796      353        24% 
========================================  =========  ======  ======  =========  ======== 
 Harrier Deep (Torok)                         35       226    1,132     486        20% 
========================================  =========  ======  ======  =========  ======== 
 Prospects Total                                                      1,624(2) 
----------------------------------------  ---------  ------  ------  ---------  -------- 
 

1. The Prospective Resources presented here are the result of a risked probabilistic aggregation of the individual stacked prospective layers in each prospect; the success case estimates present the distribution of possible outcomes in the event that at least one prospective layer is successful.

2. Unrisked mean total is not representative of the expected total from the four prospects and assumes a success case in all four wells.

3. COS represents the geological chance of success of at least one of the stacked layers which comprise each prospect. This excludes phase risk which ERCE has estimated to be 70% oil (30% gas). The Prospective Resources have also not been adjusted for the chance of development, which is estimated by 88 Energy to be 60% (including phase risk), ERCE sees this as reasonable based on the data available. Quantifying the chance of development (COD) requires consideration of both economic contingencies and other contingencies, such as legal, regulatory, market access, political, social license, internal and external approvals and commitment to project finance and development timing. As many of these factors are out-with the knowledge of ERCE they must be used with caution.

4. Gross Prospective Resources include off-block volumes over which 88 Energy has no mineral rights. Net working interest Prospective Resources are based on the on-block volumes and 88 Energy's 100% working interest. Net entitlement Prospective Resources are the net working interest Prospective Resources less royalties payable to others. The net entitlement interest to 88 Energy is calculated as 84.7% of net working interest after deduction of state royalty (12.5%) and overriding royalty interests (1.3%and 1.5%).

, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.

END

UPDSFLEFMEESEEF

(END) Dow Jones Newswires

January 17, 2022 02:00 ET (07:00 GMT)

88 Energy (LSE:88E)
Gráfica de Acción Histórica
De Abr 2022 a May 2022 Haga Click aquí para más Gráficas 88 Energy.
88 Energy (LSE:88E)
Gráfica de Acción Histórica
De May 2021 a May 2022 Haga Click aquí para más Gráficas 88 Energy.