18 October 2016
This announcement contains inside information
Significant Conventional Potential Identified at Project Icewine
88 Energy Limited (“88 Energy”, “the Company”, “Operator”) (ASX, AIM: 88E) is pleased to provide an update on Project Icewine, located onshore North Slope of Alaska (77.5% working interest, 88 Energy).
- Interpretation of modern 2D seismic data acquired by 88 Energy in early 2016 has identified multiple large conventional leads in Brookian Sequence across the Project Icewine acreage
- 758 million barrels of prospective mean recoverable oil (gross) identified in current top 5 leads (587 million barrels net to 88E, based on internal estimates) *
- “Alpha” lead located in close proximity to existing transport infrastructure and Trans Alaskan Pipeline with 118 million barrels prospective mean recoverable oil (gross)*
- Further seismic interpretation and mapping ongoing: ~50% complete with potential for additional leads to be identified
Seismic Interpretation and Mapping
88 Energy has progressed the interpretation of the 2D seismic data acquired early in 2016. Based on the preliminary interpretation 88E has identified a number of encouraging conventional leads within the Brookian sequence. These leads are predominantly stratigraphic and considered to be associated with slope apron and basin floor fan systems. Although at an early stage of assessment 88E is encouraged and considers them to have similar potential to other productive fan plays identified on the North Slope. At this interim stage approximately 20 leads have been provisionally mapped across the Icewine acreage of which five key leads have been prioritised for early maturation and are summarised in Table 1 below.
|Table 1: Prospective Oil Resources (Unrisked Recoverable)* for Current Top 5 Ranked Leads|
|Name||P90||P50||P10||Mean (Gross)||Mean (Net to 88E- WI: 77.5%)|
|* Prospective resources classified in accordance with SPE-PRMS as at 18th October 2016 using probabilistic and deterministic methods on an unrisked basis. Leads identified from interpretation of modern 2D seismic acquired in 2015/2016 across Project Icewine, which comprises 271,119 gross acres on the Central North Slope of Alaska. 88 Energy is Operator of record at Project Icewine (through its wholly owned subsidiary Accumulate Energy Alaska, Inc) with a 77.5% working interest.
Cautionary Statement: The estimated quantities of petroleum that may be potentially recovered by the application of a future development project relate to undiscovered accumulations. These estimates have both an associated risk of discovery and a risk of development. Further exploration, appraisal and evaluation are required to determine the existence of a significant quantity of potentially movable hydrocarbons.
88E is encouraged by the potential resource size of the leads and will undertake further technical work in order to mature the evolving conventional portfolio from which future likely drilling candidates will be selected.
Additional information on Project Icewine and the Alpha and Bravo leads, which the Company believes are representative of the play potential across the Icewine acreage, is set out in the pdf version of the announcement which is available on the Company’s website www.88energy.com.
88E will provide further updates to the market as the technical work progresses.
Managing Director of 88 Energy Limited, Dave Wall commented:
“Whilst the HRZ remains the Company’s primary target and the focus of our short-term activity with the upcoming Icewine#2 well scheduled for spud in the first quarter of next year, the interim results from the 2D seismic acquired earlier this year have significantly exceeded our expectations.
It has taken a little longer than initially planned to process and interpret, as the number of features we are seeing is greater than anticipated. Further interpretation and analysis is ongoing and the final findings from that process will be announced later in the year.
We expect the two recent billion barrel discoveries in the Brookian sequence by both Armstrong Oil & Gas and Caelus Energy to be a catalyst for increased industry interest in the region. Whilst not strictly analogous to the Brookian play potential at Project Icewine, these discoveries highlight the significant conventional oil resource on the North Slope yet to be discovered through utilisation of modern seismic technology.”
Media and Investor Relations:
|88 Energy Ltd
Dave Wall, Managing Director
Finlay Thomson, Investor Relations
Tel: +61 8 9485 0990
Tel: +44 7976 248471
Tel: +61 8 9268 2829
Neil McDonald/Derrick Lee
Tel: +44 131 220 6939
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, Mr Brent Villemarette, who is a Non Executive Director of the Company. Mr Villemarette has more than 30 years' experience in the petroleum industry and is a qualified Reservoir Engineer 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. His academic qualifications and industry memberships appear on the Company's website and both comply with the criteria for "Competence" under clauses 18-21 of the Valmin Code 2005. Terminology and standards adopted by the Society of Petroleum Engineers "Petroleum Resources Management System" have been applied in producing this document.
About 88 Energy: 88 Energy has a 77.5% working interest and operatorship in ~271,000 acres onshore the prolific North Slope of Alaska (“Project Icewine”). The North Slope is the host to the 15 billion barrel Prudhoe Bay oilfield complex, the largest conventional oil pool in North America. The Company, with its Joint Venture partner Burgundy Xploration, has identified three highly prospective play types that are likely to exist on the Project Icewine acreage – two conventional and one unconventional. The large unconventional resource potential of Project Icewine was independently verified by leading international petroleum resource consultant DeGolyer and MacNaughton. In addition to the interpreted high prospectivity, the project is strategically located on a year-round operational access road and only 35 miles south of Pump Station 1 where Prudhoe Bay feeds into the Trans Alaska Pipeline System. The Company has recently acquired 2D seismic to take advantage of the globally unique fiscal system in Alaska, which allowed for up to 75% of 1H2016 exploration expenditure to be rebated in cash. Interim results from this seismic are encouraging, having identified several large leads. In late 2015, the Company completed its maiden well at the project, Icewine#1, to evaluate an unconventional source rock reservoir play which yielded excellent results from analysis of core obtained from the HRZ shale. A follow-up well with a multi-stage stimulation and test of the HRZ shale, Icewine#2, is planned for 1Q2017.