Q & A Part 2 – Share Talk blogger Steven Larratt

We last covered 88E Energy with Dave Wall company MD answering a Q & A session with Share Talk.

Today we follow up with Steve’s second update on 88E with his views and expected updates that may follow. This is the second review on the Q & A session with David Wall and 88e from 26th January 2016.

88 Energy has a 78% working interest and operatorship in ~272,000 acres (~174,000 acres’ subject to formal award) onshore the prolific North Slope of Alaska (“Project Icewine”). The North Slope is the host for 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.

Drone Video of Icewine #1 exploration well Drilling Operations

Or visit the 88 Energy Site to Download this Video Directly

We last covered 88E Energy with Dave Wall company MD answering a Q & A session with Share Talk.

Today we follow up with Steve’s second update on 88E with his views and expected updates that may follow.

This is the second review on the Q & A session with David Wall and 88e from 26th January 2016. This time we are focussing more on the company’s potential joint venture program as well as expectations in the near to mid-term.

The main aim of Icewine#1 was to prove up the acreage and see what they had in the ground. This was done in an amazingly fast time by astutely using the pre-existing constructed Ice Pad for the drill site.

The desired spud date seemed to have been almost predetermined to ensure that 88e could be in a position to have initial readings that would allow them to subsequently bid on additional land purchases armed with the knowledge of the potential prospects in place.  This showed great foresight by Dave Wall and could pay massive dividends to all shareholders as the realisation of such huge potential becomes evident over time.

3D data acquisition

There are two parts to the 3D:

1). Acquiring already shot dataset

88e has a unique opportunity to purchase already shot 3D imagery on the existing Icewine acreage. This was shot by Saexploration 1H15 and became ready for use in December. Saexploration had an 85% rebate on the shoot so retrospectively should be cheap for 88e to purchase. This will enable the joint ventures to be able to assess the potential of our acreage.

2). New ‘to be shot’ 3D data

In October 2015, 88e submitted permits to shoot our own 3D data for the ‘to be purchased land’ and are in negotiations with partners to finalise contracts. This will be subject to the 75% rebates that are in place during 1H16 and will be able to be used around the end of the year.

Dave Wall has said that there are several interested third parties but is keeping his cards close to his chest about how good any potential deal might be to 88e at this present time.

So, what would attract a joint venture partner and what would they be part of? Well, the Icewine acreage is almost a dream come true, Yet why?

  • Alaska is in an economically stable country
  • Great infrastructure with the Dalton highway and Trans Alaskan Pipeline System very nearby
  • Alaskan government wants oil to be extracted
  • very attractive rebates of 35% ongoing in place
  • let’s not forget that 88E are in ‘the oiliest place on earth’,
  • They have the wealth of knowledge by the Eagle Ford guru Paul Basinski.

Based on the expected news, I believe the results of the cores will be looked at and studied in depth and the Saexploration 3D purchased upon favourable results. We can then look forward to permit approval and contract completion for the ‘to be’ shot 3D.

Based on past history the land purchase will probably be finalised in June (88e have already covered the deposits for this).

The recent quarterly reports have shown the company have a good amount of cash on going. “We will use our US$50million Bank of America draw down as an ongoing facility, towards the rebate portion of our costs for the purchase of items and towards the drills ongoing”. This drawdown facility could potentially be increased in case of a multi-drill program.

After favourable results of the cores the only concern is the price of oil. However, this has risen nicely over the last week and the general consensus is for a reasonable rise over the coming weeks and months. The terms of the joint venture have too many permutations to best guess but they could be very favourable as 88E have a 35% rebate in place and the very real potential of having more oil in place than the Eagle Ford discovery. Very exciting times lie ahead for 88e in my honest opinion.

In summary, highlights going forward are:

  1. Icewine#1 drill results and core analysis
  2. Sae 3D purchase and analysis
  3. ‘New land’ 3D permit approval and shoot to be commenced
  4. Joint venture talks on going
  5. New land purchase

Steve

LSE Share Talk will be following 88E Energy PLC progress over the coming months and if you wish to follow their twitter account @88EnergyLtd or look at the 88 Energy company website . This is a company with a short – midterm business plan that looks very interesting and one Private Investors should have on their watch list.

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A special thank you to Steve Larratt for sharing and if you wish to follow his twitter account @slarratt1

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Icewine #1 Drilling Update - 88E