88 Energy Ltd (ASX,AIM:88E) Project Icewine Operations Update

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.

Highlights

· Currently flowing back naturally on 8/64 choke at ~55 barrels per day frac fluid

· Minor hydrocarbon indications via flow rate of 2-4mcf of gas per day, with a maximum rate of 8mcf of gas per day

Icewine#2 Operations Update

The Icewine#2 well was shut-in on 10th July to allow for imbibition and pressure build up to occur within the HRZ shale. Flow testing re-commenced on 31st August at 10:26 (AK time), and is ongoing. Results since flow testing recommenced are summarised below.

The Icewine#2 well is located on the North Slope of Alaska (ADL 392301). 88 Energy Ltd (via its wholly owned subsidiary, Accumulate Energy Alaska, Inc) has a 77.55% working interest in the well. The well was stimulated in two stages over a gross 128 foot vertical interval in the HRZ shale formation, from 10,957-11,085ft TVD, using a slickwater treatment comprising 27,837 barrels of fluid and 1,034,838 pounds of proppant.

The well was initially flowed back on a 6/64 inch choke and was reduced to a 4/64 inch choke after 26 hours to maintain pressure. Approximately 370 barrels of frac fluid had been recovered as at 1730 on 3rd September (AK time) at an average rate of 100 barrels per day. The choke was subsequently stepped up to 8/64 inch at 1800 10th September (AK time) as the overall declining pressure gradient versus time improved, indicating potential pressure support. To date, the cumulative amount of stimulation fluid produced from both testing periods is 5,277 barrels, 19.0% of fluids injected.

Wellhead pressure built to ~3,500psi during shut-in and has dropped to 106psi since flowback commenced and is now declining very slowly with a relatively constant flowback rate of 55 barrels per day. At 0930 9th September (AK time), a decision was made to run the flowback through the test separator due to minor gas indications being evident. To date the rate of flow has been unstabilised at between 2 and 4 mcf per day made up of 76% hydrocarbons, 20% atmospheric gases and 4% inorganics. The produced hydrocarbons comprise 93% methane with 7% heavier fractions.

The current flowback procedure remains early stage with only 19.0% of the frac fluid retrieved. The gas observed so far is not considered representative of the potential rate or composition of hydrocarbon in the reservoir. It is interpreted that additional frac fluid needs to be removed in order to achieve a representative result. A decision will be made on the most appropriate strategy to accomplish this within the next two weeks.


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