TIDM88E
RNS Number : 1149D
88 Energy Limited
01 March 2022
This announcement contains inside information
1 March 2022
88 Energy Limited
Merlin-2 Pre-Spud Operations On Track
Highlights
-- Mobilisation of the Arctic Fox rig completed.
-- Spud of Merlin-2 well scheduled for the week commencing 7 March 2022.
88 Energy Limited (ASX:88E, AIM:88E, OTC:EEENF) ( 88 Energy or
the Company ) is pleased to report that the mobilisation of the
Arctic Fox rig to the Merlin-2 appraisal well drilling location is
now complete.
Pre-spud operations are continuing and now entering the final
phase. The Merlin-2 spud date is scheduled for the week commencing
7 March 2022, with the well permitted to a Total Depth ( TD ) of
8,000 feet.
The well is planned to be initially drilled to 2,000 feet, with
the surface casing then installed and the Blow Out Preventer system
tested. This is anticipated to collectively take approximately one
week. Drilling to TD is then expected to take a further four weeks,
including wireline logging.
A production test program for the Merlin-2 well has been
designed and equipment placed on standby during initial well site
operations. Flow testing of Merlin-2 will be contingent upon the
wireline results, in particular the MDT outcomes, as well as
government approvals and weather window considerations.
88 Energy Managing Director and CEO, Ashley Gilbert,
commented:
"We are now entering the final phase of pre-spud preparations
and look forward with excitement to the next few weeks of drilling
operations. Success at Merlin-2 has the clear potential to be
transformational for our shareholders and we look forward to
providing updates as the drilling of this appraisal well
progresses."
The below graphics can be viewed in the pdf version of this
announcement, which is available on the Company's website
www.88energy.com:
-- Mobilisation of Arctic Fox rig modules to Merlin-2 drilling location
-- Project Peregrine and Recent Nanushuk Discoveries (with
approximate Merlin-2 appraisal well location)
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 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%).
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END
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