Fantastic Ann, great timing and should satisfy many bystanders waiting for some news. Engaging Baker Hughes on the HRZ is also a master stroke so well done Dave and the crew for their efforts this year.
Festive greetings to all
20 December 2018
88 Energy Limited
Operations Update
88 Energy Limited ("88 Energy" or the “Company", ASX:88E, AIM 88E) is pleased to advise the
following in relation to its oil and gas operations on the North Slope of Alaska.
Highlights
• Multiple high-quality parties active in conventional dataroom
o Deadline for bids extended due to request
o Deal now targeted for 1Q 2019
• Initial HRZ review by Baker Hughes encouraging
o Additional value add analysis now underway ahead of finalising farm-out package
• Yukon Leases - 3D seismic processing continues with inversion now underway
• Western Leases – Winx-1 exploration well on schedule for February 2019 spud
Project Icewine - Conventional
The level of interest and the quality of parties in the Project Icewine Conventional farm-out
dataroom remains highly encouraging. 88 Energy decided to honour requests for an extension to
the year-end deadline in order to maximise the number of bid ready parties, whilst also remaining
within the logistical schedule required for the drilling of multiple wells in the 2020 operating season.
Consequently, the Company is now targeting close of a deal in 1Q 2019.
Project Icewine – HRZ Shale
The Project Icewine JV engaged Baker Hughes, a GE Company, to undertake a comprehensive,
ground-floor peer review of data and analysis, both internal and third-party, related to the HRZ
shale. This analysis included the pre-drilling work completed by Burgundy Xploration as well as
data obtained from the Icewine-1 and Icewine-2 wells. Baker Hughes brings global experience from
both longstanding and burgeoning unconventional plays to provide integrated geological,
structural, petrophysical, and geomechanical interpretations for evaluation of the HRZ shale. The
initial review is now complete and is consistent with the prior work done.
Given the rapid advancement of unconventional assessment technologies over the past several
years, Baker Hughes has recommended several new state-of-the-art lab tests to augment the
current body of work. The main thrust of the work being undertaken is to better understand the
producibility of the formation by advanced electron microscope analysis, which will allow for a
spatial understanding of landing zones in a horizontal lateral. This work incorporates an
integrated producibility, fracability and geohazards model to find optimal placement for a lateral
well in addition to a completion and stimulation program.
The JV is also working with the U.S. Geological Survey (USGS), who have access to specialist
testing equipment, which allows for better definition of quantitative oil and gas biomarkers, kerogen,
age dating, as well as variability in source rock geochemistry, both vertically within the core due to
changes in lithofacies and laterally across the fairway.
In summary, the HRZ shale remains prospective and will continue to be a focus for 88 Energy in
order to unlock its considerable value for shareholders. Work currently underway is expected to be
complete in 1H 2019 ahead of commencing farm-out proceedings.
w ww. 88energy.com
103 Level 2, 5 Ord Street, West Perth WA 6005 PO Box 1674, West Perth WA 6872 Australia Phone +61 8 9485 0990
ABN 80 072 964 179
Yukon Leases
The Yukon Leases contain the recently defined Cascade Prospect (refer release dated 7 November
2018). Inversion of the modern 3D seismic, acquired in 1Q 2018, used to delineate Cascade is now
underway, with results expected in February 2019.
Cascade was intersected by the Yukon Gold-1 well, drilled in 1993, which penetrated the prospect
in a down-dip location in reasonable quality, hydrocarbon saturated sandstone. The up-dip portion
of the prospect can now clearly be identified as a channelised feature and is likely to contain thicker
sands of higher quality.
Western Leases
As recently announced, all major permits associated with the drilling of the Winx-1 well (with the
exception of the Permit to Drill) are now in hand. The Permit to Drill will be submitted prior to yearend,
as planned. All other logistics are on schedule for commencement of drilling at Winx in
February 2019.
Winx-1 is located ~4 miles east of the Horseshoe1/1A well that significantly extended the highly
successful Nanushuk play fairway to the south. Winx-1 will target multiple stacked potential
objectives, including the Nanushuk, which is the primary target of the well.
Commenting on the operations update, Dave Wall, Managing Director of 88 Energy, stated: “By
shifting the self-imposed year-end deadline for the Icewine conventional farm-out, we are
maximising the chances of achieving the best deal possible for our shareholders and we remain
highly encouraged by the level of activity and the quality of the parties active in the dataroom.
The first quarter of 2019 is shaping up to be an important period for the Company with results
expected from ongoing analysis related to the HRZ shale, the drilling of the Winx-1 exploration well,
further definition of the potential on the Yukon Leases and, of course, the Project Icewine
conventional farm-out.
We look forward to a prosperous 2019 and wish all our shareholders a safe festive season.”
Yours faithfully
Dave Wall
Managing Director
88 Energy Ltd
Expand
(20min delay)
