REG - 88 Energy Limited - Hickory-1 Pre-Spud Operations On Track

88 EnergyAnnouncement

27/02/2023 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20230227:nRSa0649Ra&default-theme=true

RNS Number : 0649R  88 Energy Limited  27 February 2023

27 February 2023

 

 

88 Energy Limited

Hickory-1 Pre-Spud Operations On Track

Highlights

·     Ice pad construction nearing completion.

·     Mobilisation of the Nordic Calista Rig-2 and operations equipment
to commence shortly.

·     Spud of Hickory-1 well on track for early March 2023.

 

88 Energy Limited (ASX:88E, AIM:88E, OTC:EEENF) (88 Energy or the Company) is
pleased to report that the Hickory-1 ice pad construction is nearing
completion and that pre-spud operations are on schedule. The Hickory-1 well is
located within 88 Energy's Project Phoenix acreage, directly adjacent to the
Trans-Alaska Pipeline System and the Dalton Highway.

Mobilisation of Nordic Calista's Rig-2 to the Hickory-1 well location is
expected to commence shortly, together with equipment and services relating to
the well operations. Hickory-1 spud remains on track for early March 2023.

The well is designed to appraise up to six conventional reservoir targets
within the SMD, SFS, BFF and KUP reservoirs and 647 million barrels of
oil(1,2) and is permitted to a total depth (TD) of up to 12,500 feet. The
primary targets for the well are the 3 SMD reservoirs (SMD-A, B and C), with
the SFS and BFF reservoirs considered secondary targets. The KUP reservoir is
a tertiary target and will be drilled subject to time remaining in the season,
borehole conditions and other technical considerations.

The Hickory-1 surface hole is planned to be drilled to 3,500 feet, with 9 5/8"
surface casing installed and the blow-out preventer system tested. This is
anticipated to take up to two weeks in total. Drilling to TD is then expected
to take a further two weeks, at which point a targeted wireline logging
program is scheduled.

Flow testing of the Hickory-1 well is planned to be undertaken during the
2023/24 winter season, subject to well results. This will provide ample time,
subsequent to drilling of the well, to optimise the flow test program, design,
permitting and implementation.

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 resource - Net Entitlement to 88 Energy. Refer
announcement released to ASX on 23 August 2022

Figure 1: Hickory-1 well designed to test up to 6 stacked targets.

 

 

Figure 2: Nordic Calista Rig-2 preparations ahead of mobilisation to Hickory-1
drilling location

 

 

This announcement has been authorised by the Board.

 

Media and Investor Relations

 

 88 Energy Ltd

 Ashley Gilbert, Managing Director
 Tel: +61 8 9485 0990

 Email:investor-relations@88energy.com

 Fivemark Partners, Investor and Media Relations
 Michael Vaughan                                  Tel: +61 422 602 720

 EurozHartleys Ltd
 Dale Bryan                                       Tel: + 61 8 9268 2829

 Cenkos Securities Plc                            Tel: +44 (0)20 7397 8900
 Derrick Lee                                      Tel: +44 (0)131 220 6939
 Pearl Kellie                                     Tel: +44 (0)131 220 9775

 

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 Phoenix

Project Phoenix (88E 75.2% WI) is located on the central North Slope of Alaska
and encompasses approximately 82,846 gross acres. It is situated on-trend to
recent discoveries by Pantheon Resources Plc (LSE: PANR) in multiple, newly
successful play types across top, slope and bottom-set sands of the Mid
Schrader Bluff, Canning and Seabee formations. Independent mapping has
demonstrated that these plays extend into the Phoenix acreage.

Project Phoenix holds an estimated, unrisked conventional total of 647MMbbl of
prospective oil resources (mean unrisked, net to 88E), independently assessed
by Lee Keeling and Associates (LKA) in Q3 2022 (see 88E ASX release dated 23
August 2022). The acreage has been significantly de-risked by the recent
Pantheon drilling and flow tests on their adjacent acreage to the North,
coupled with data from Icewine-1 well logs (encountered 380 ft of net oil pay
within SMD sands) and a modern 3D seismic data set (FB3D).

Figure 1: Project Phoenix lease area, including mapped play fairways, Franklin
Bluffs 3D area and planned Hickory-1 well location (subject to permitting, as
well as JV and Government approvals).

 

 Phoenix: Alaska North Slope            Unrisked Net Entitlement to 88E (1,6) Prospective Oil Resources (MMstb) (4,5)
 Prospects (Probabilistic Method)       Low (1U)          Best (2U)         High (3U)         Mean              COS(3)
 Shelf Margin Delta (SMD A, B & C)      44                140               326               145               81%
 Slope Fan System (SFS)                 24                84                217               89                50%
 Basin Floor Fan (BFF)                  75                341               930               358               50%
 Kuparuk (KUP)                          24                56                98                56                72%
 Prospects Total                         167                621              1,570                647 (2)

 

1.    88 Energy net resources have been calculated using a 75.227% working
interest and a 16.5% royalty.

2.    The unrisked means, which have been arithmetically summed, are not
representative of expected total from the prospects and implies a success case
in all reservoir intervals. 88 Energy cautions that the arithmetically summed
1U estimate may be a conservative estimate and the arithmetically summed 3U
estimate may be optimistic when compared to a statistical aggregation of
probability distributions.

3.    COS represents the geological chance of success as assessed by 88
Energy and reviewed and endorsed by LKA.

4.    Prospects are subject to a phase risk (oil vs gas). Chance of oil has
been assessed as 100% for all targets except for the Kuparuk Formation which
has been assessed as 70%.  Phase risk has not been applied to the unrisked
numbers.

5.    The Prospective Resources have not been adjusted for the chance of
development. Quantifying the chance of development (COD) requires
consideration of both economic 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 outside the knowledge of LKA they must be used with caution.

6.     Please refer to ASX announcement dated 23 August 2022 for further
details in relation to the prospective resources estimate and associated
risking with Phoenix.

 

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

This information is provided by RNS, 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 (mailto:rns@lseg.com)
 or visit
www.rns.com (http://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 (https://www.lseg.com/privacy-and-cookie-policy)
.   END  MSCFQLLLXLLBBBV