88 Energy Limited (ASX: 88E) (“88 Energy” or the “Company”) provides the following update related to the upcoming drilling of the Charlie-1 appraisal well at Project Icewine, located on the Central North Slope, Alaska.
· Ice road construction underway – base layer ~25% complete
· Permit to Drill submitted – approval expected in January 2020
· Operational activity for Charlie-1 progressing to plan for February 2020 spud
Ice road construction is now fully underway with ~25% of the base road now completed and ~35% of the total route staked and pre-packed.
The Permit to Drill was submitted prior to the end of 2019, as planned, and approval is expected towards the end of January. This is the last major permit required prior to spud of the Charlie-1 well.
A more accurate forecast for the scheduled February spud and timing for the drilling / logging / testing program will be communicated in due course.
As per the farm-out agreement, initial cash calls have been receipted into the Joint Venture account.
88 Energy Managing Director, Dave Wall commented:
“The New Year is off to a busy start for the Alaska Operations team with all activity progressing as planned.”
About the Charlie-1 Appraisal Well
The Charlie-1 appraisal well has been designed as a step out appraisal of a well drilled in 1991 by BP Exploration (Alaska) Inc called Malguk-1. Malguk-1 encountered oil shows with elevated resistivity and mud gas readings over multiple horizons during drilling but was not tested due to complications towards the end of operations, which resulted in lack of time before the close of the winter drilling season. It was also drilled using vintage 2D seismic, which was insufficient to adequately determine the extent of any of the prospective targets encountered.
88 Energy subsequently undertook revised petrophysical analysis, which identified what is interpreted as bypassed pay in the Malguk-1 well. 88E also completed acquisition of modern 3D seismic in 2018, in order to determine the extent of the discovered oil accumulations. Charlie-1 will intersect seven stacked prospects, four of which are interpreted as oil bearing in Malguk‑1 and are therefore considered appraisal targets. 88 Energy will operate Charlie-1, via its 100% owned subsidiary Accumulate Energy Alaska, Inc, with cost of the well to be funded by Premier Oil Plc up to US$23m under a recent farm-out agreement. Drilling is scheduled to commence in February 2020 with flow testing anticipated to conclude in April 2020. The total Gross Mean Prospective Resource across the seven stacked targets to be intersected by Charlie-1 is 1.6 billion barrels of oil (480 million barrels net to 88E). Refer announcement dated 23rd August.
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.
A graphic showing the proposed Charlie-1 well location and the targets referred to in the table above can be viewed at the following link http://www.rns-pdf.londonstockexchange.com/rns/7868Z_1-2020-1-14.pdf
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