Active ASX-listed Alaskan oil and gas explorer/developer 88 Energy now has a full treasury and no debt after closing the recently flagged early sale of state oil and gas tax credits worth US$18.7 million to a US company. 88 Energy now has about A$15m in the tin to accelerate exploration in Alaska where it is targeting more than one billion barrels of oil in gross mean prospective resources at the cornerstone Peregrine field.
A green light from the Alaskan Department of Revenue to realise value from the tax credits about five years ahead of schedule has allowed the Australian company to sell the credits and it now says US$16.1 million of the US$18.7 million cash price received has gone into full repayment of its debt with FCS Advisors.
88 Energy tipped the balance of the sale proceeds into its working capital drawer and says it had a provisional A$14.8 million at hand at the end of June.
The tax credits windfall also eliminates more than US$1 million of annual finance costs for the oil junior, allowing it to aim its now tightened balance sheet squarely at resource growth at its 100 per cent-owned Peregrine project.
Peregrine, in Alaska’s northern NPR-A region, covers about 195,000 continuous acres along trend to recent discoveries in the state’s oil-rich Nanushuk formation. The Nanushuk sequence continues to the north of Peregrine where New York-listed energy major ConocoPhillips’ recent Willow discovery has a reported 750-800 million barrels of recoverable oil resources. ASX-listed Oil Search hit oil last year at Mitquq and Stirrup, about 50km north-east of Peregrine and has reported 3,520 barrels of oil per day in production testing.
88 Energy is targeting a gross mean prospective resource of 645 million barrels of oil at its recently drilled Merlin-1 well at Peregrine. The company plans to drill the Harrier-1 well at Peregrine next year and has a target of 417 million barrels of oil in gross mean prospect resources at the prospect.
Meanwhile, 88 Energy this week said it was adopting the environmental, social and governance or “ESG” framework developed by the World Economic Forum – the “global standard for ESG reporting” encompassing 21 core metrics and disclosures.
The company has engaged independent impact monitoring technology provider, Socialsuite, to assist with measuring, monitoring and reporting of the ESG metrics.
88 Energy Managing Director Ashley Gilbert said: “I am delighted that the 88 Energy Board has adopted this universal ESG framework to measure and report on our performance in these areas. 88 Energy continues to build on its success as an energy explorer on the North Slope of Alaska, whilst also contributing to the development of this region. We are proud to be introducing the global gold standard in ESG principles to our way of thinking and how we do business.”
The company said in line with best practice ESG disclosure it planned to keep the market updated regularly on its ESG performance and progress as it “set a new standard in measuring the sustainability and ethical impact” of its operations.
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