88 Energy Limited Project Icewine Conventional Farmout Executed (8514J)
22 Agosto 2019 - 8:01AM
UK Regulatory
TIDM88E
RNS Number : 8514J
88 Energy Limited
22 August 2019
22(nd) August 2019
This announcement contains inside information
88 Energy Limited
Project Icewine Conventional Farmout Executed
88 Energy Limited (ASX: 88E) ("88 Energy" or the "Company")
provides the following update related to the farmout process for
its conventional prospect portfolio at Project Icewine, located on
the Central North Slope, Alaska.
Highlights
Please refer to text in italics from the Premier Oil PLC
("Premier") Half Yearly Report, below:
Alaska
Premier has signed a Sale and Purchase Agreement with 88 Energy
and Burgundy Xploration LLC to farm-in for a 60 per cent interest
in Area A of their conventional Project Icewine acreage in the
proven Alaska North Slope basin. This acreage lies close to the
Trans-Alaska Pipeline and the Dalton Highway. The transaction
provides Premier with a cost effective entry point into an emerging
play, following recent advances in drilling and completion
techniques, within a proven oil province and one which has the
potential to deliver significant organic growth opportunities for
the Group.
Area A contains the Malguk-1 discovery drilled by BP in 1991.
This well discovered but never tested 251 feet of light oil pay in
turbidite sands in the Torok formation, within the recently
emerging Brookian play. Premier estimates an accumulation of more
than 1 billion barrels of oil in place, based on the original well
data and its evaluation of the existing 3D dataset. There is also
considerable upside in the shallower Schrader Bluff formation which
has yet to be explored in a play similar to the Pikka/Horseshoe
trend. The Alaska North Slope has attracted considerable industry
interest recently with technological advances enabling these once
stranded resources to now be commercialised. Several similar
developments are already underway at various levels of maturity
involving operators such as ConocoPhillips, ENI, Repsol and Oil
Search.
Under the terms of the SPA, Premier will pay the full costs of
an appraisal well up to a total of US$23 million to test the
reservoir deliverability of the Malguk-1 discovery. The well will
be drilled and tested in Q1 2020 with rig options having already
been identified and contracting negotiations underway. On
successful completion of the work programme, Premier will have the
option to assume operatorship.
Additional Details
-- 88 Energy to retain 30% working interest in Area A
-- Premier has an option to earn 50% working interest in Area B
or C by spending US$15m, if the Charlie-1 (Malguk-1 appraisal) well
in Area A is successful
-- 88 Energy to operate the Charlie-1 (Malguk-1 appraisal) well
via its wholly owned Alaskan subsidiary, Accumulate Energy Alaska
Inc
-- Standard completion documents have been agreed and are in the
process of execution, including the Joint Operating Agreement and
assignment forms
-- Permitting on track: amendments to key permits, associated with 2020 drilling, submitted
A more detailed presentation on the upcoming drilling of the
Charlie-1 (Malguk-1 appraisal) well will be released in early
September.
Lazard Freres and Co LLC acted as Financial Advisor to the
transaction for 88E and Burgundy.
88 Energy Managing Director, Dave Wall, commented "We are
delighted to be partnering with a company of the technical calibre
of Premier. Premier has a strong track record of delivering
projects through to production and is an excellent addition to the
Joint Venture. The deal itself strikes a good balance between
cultural fit, value and the meaningful working interest retained by
88E for its shareholders. The Charlie-1 well has been designed to
test all of the prospective horizons identified in the Western Play
Fairway, giving benefit usually only derived from a multi-well
program."
Media and Investor Relations:
88 Energy Ltd
Dave Wall, Managing Director Tel: +61 8 9485 0990
Email: admin@88energy.com
Finlay Thomson, Investor Relations Tel: +44 7976 248471
Hartleys Ltd
Dale Bryan Tel: + 61 8 9268 2829
Cenkos Securities Tel: + 44 131 220 6939
Neil McDonald/Derrick Lee
A copy of this announcement including a graphic showing the
Demarcated Project Icewine Acreage with Charlie-1 Location is
available at
http://www.rns-pdf.londonstockexchange.com/rns/8514J_1-2019-8-21.pdf
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END
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