19/11/2020 - 13:05

88 Energy banks $10m ahead of Alaskan oil drilling

19/11/2020 - 13:05

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After lifting the lid on a monstrous resource upgrade at its 75 per cent-owned Icewine oil development project in Alaska, ASX-listed 88 Energy has completed a $10 million placement to a range of institutions and sophisticated investors. The Perth oiler can now conclude its pending farm-out deal to drill two prospects early next year on its Peregrine oil project ground on Alaska’s lucrative North Slope.

The Artic Fox rig being set up for winter drilling operations in Alaska. Credit: File.

After unveiling a monstrous resource upgrade at its Icewine oil development project in Alaska, ASX-listed 88 Energy has moved quickly to capitalise on the news, completing a $10m capital raise as it stands poised to join the billion-barrel oil club.

88 Energy said the capital raised will be allocated largely to funding its share of well costs at the Peregrine oil project, over and above any farm-out funding expected from its impending deal to drill two prospects at its ground on Alaska’s lucrative North Slope.

88 Energy Managing Director, David Wall said:

"Completion of this placement positions the Company strongly as preparations continue for the drilling of the Merlin-1 and Harrier-1 wells, which will test multiple conventional targets, in Q1 CY2021.”

“Final documentation in relation to the Peregrine farm-out with the preferred bidder is progressing with execution of final documents expected in the next few weeks.”

“Planning and permitting remains on schedule for a late February 2021 spud of the first well at Project Peregrine.”

Once partnered-up, 88 Energy plans to hit the ice road in Alaska’s frozen top-end and drill test its two key prospects of Merlin and Harrier, with the rotary truth diviner set to start turning just three months from now.

Previous estimates on the potential size of the Merlin prospect have hovered around the 645 million-barrel mark with a possible upside of over 1 billion barrels of prospective oil resources.

Interestingly, the company has noted many similarities in the seismic signatures of its Merlin prospect when compared to the 750 million-barrel Willow oil field operated by ConocoPhillips that sits only 25km or so to the north.

The same seismic data suggests similarities between its Harrier prospect and Conoco’s second oil discovery at Harpoon, southeast of the Willow field.  88 Energy said it had tuned up both Merlin and Harrier with some fresh analysis of the seismic signatures across the Nanushuk Formation oil reservoir target at each prospect.

If sitting on huge potential upside at Icewine isn’t already enough, the thought of another potential headline-grabbing oil development for 88 Energy is also in the offing with the company commencing drilling early in 2021.

 

Is your ASX listed company doing something interesting? Contact: matt.birney@businessnews.com.au

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